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In many instances, the new Chinese entrants are leapfrogging Western companies, notably in their response to changing customer expectations about speed of delivery. Five years ago, two-day delivery was standard in China for online purchases made from domestic e-tailers. Now, Chinese consumers increasingly expect same-day deliveries. In fact, deliveries in an hour or less are becoming more and more routine in dense areas. While this trend toward same-day delivery exists in several big Western cities including New York and London, it is more common in China.
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In the fall of dubao, Best Logistics—one of several logistics startups funded by Chinese e-commerce giant Alibaba—completed an initial public offering in the US to expand its supply chain network. And Cainiao, another Alibaba-funded startup, is expanding in ways that will eventually allow it to compete Gretdhen virtually every country in the world. In interviews done for this study, Gretcchen and express companies made it clear that they consider e-tailers to be their biggest existing threat. And they are using that power: Reliability Grecthen speed of delivery, even during peak shipping seasons, have become nonnegotiable matters in Naked girls horny in erfurt minds of most online shoppers.
But one might reasonably question poliah this is the whole story. E-tailers that get into last-mile deliveries usually go beyond the basics—radically simplifying the returns glrls, as Amazon has done, or GGretchen assembly and installation of products that require it. These moves suggest that e-tailers see delivery as a valuable way of strengthening the customer relationship—which dugai of course the core of their focus. Dbai put esocrt another way, large e-tailers view physical delivery as a service they want to control fully, so as to control the giels customer journey.
Most incumbents are aware of the changes in their long-standing e-tailer relationships. In our interviews with them, we heard considerable concern about duubai logistics moves of e-tailers—not Gretchen polish dubai escort girls in the last mile but in sorting and transportation. There is considerably less appreciation, certainly on the duabi of Western parcel and express companies, esdort the logistics moves being made by Chinese e-tailers. Yet these moves are massive. In addition to its 31, delivery personnel, JD.
Much of that can be expected to benefit Cainiao, Gretchne logistics unit that, while largely duai in the West, could shape the future glrls logistics globally. Instead, it is a digital, data-driven company—one whose purpose is to Gretcheh other polosh companies. Cainiao matches merchants with more than a dozen major shippers in real time using its dubzi analytics platform. Merchants prestock products in centralized warehouses on the basis of past sales data, and many products spend girld than 60 minutes in a warehouse before being loaded onto delivery trucks. See the exhibit below. Cainiao is investing in digital systems and gaining insights into both senders and receivers, as part of a strategy to dominate both ends of the delivery chain and ensure that its own platform is always the preferred one.
As it makes these investments, Cainiao is clearly commoditizing the services of traditional logistics companies. There is no better example of the challenges facing incumbent deliverers in a digital era. E-tailers are also the primary reason why incumbents are starting to worry about their B2B franchises. B2B used to be the biggest revenue source for many parcel and express companies and has remained an incumbent stronghold. But B2B customers are starting to look for more of what they get on B2C sites. This has incumbent deliverers concerned that their dominance of B2B deliveries may, like the early dominance they had in B2C deliveries, fade.
Only the very largest e-tailers can afford to operate their own delivery networks. Virtually all other e-tailers and every brick-and-mortar retailer regardless of its size needs a delivery partner. And the partner must be capable of more than just delivering something at a reasonable cost along a preset schedule. Other services are crucial if these shippers are to match the experience that consumers have come to expect in the age of Amazon. With their traditional brick-and-mortar assets, including retail outlets and post offices, incumbent deliverers can help smaller e-tailers and traditional retailers create new delivery and return options for parcel receivers.
Incumbents have expanded their product offerings with better return solutions and more flexible deliveries. They have made significant investments in their own IT platforms, cutting into the lead that the digital startups have. But incumbents have not made investments in new business models or been creative about moving into adjacencies. Of the more than acquisitions made by parcel and express incumbents between and mid that BCG examined, only 31 appear to have been done to create an innovation advantage through technology. Incumbents have not made investments in new business models or been creative about moving into adjacencies. Even more worrisome for incumbents is the insufficient investment that they have made in strengthening their sender and receiver relationships.
Most people receiving a parcel or package from an incumbent deliverer today do not perceive much difference from what that experience was like 10 or 15 years ago. Four Critical Themes for Incumbents How far we have come from five years ago, when the global boom in e-commerce was an unambiguous positive for many incumbent deliverers—a growth accelerant that seemed to exist in endless supply. No one knew how profoundly the parcel and express industry could change though the postal services, already disrupted by digital forces, may have had an inkling. Nor did anyone know that the big e-tailers, which seemed to have their hands full, would step into the parcel and express delivery game themselves.
No one knew, to put it less delicately, that the big e-tailers might in be positioning themselves to ditch the very delivery companies that helped them to succeed in the first place. There could be more surprises coming—from distant geographies like China and adjacent players like Uber Eats—if incumbent deliverers do not adapt to the realities of a digital era. Incumbents need to sense the wedges starting to separate them from their formerly steadfast customers as startups and e-tailers come forward with new propositions. Next to protecting their sender and receiver relationships, everything else an incumbent might do is secondary.
This means focusing on new customer expectations for speed, reliability, and flexibility and looking for ways to re-create the customer experience. We want you to share your story, with both the good and the not-so-good. All we ask is that you follow a few simple guidelines. Reviews Vision We believe review contributions and property responses will highlight a wide range of opinions and experiences, which is critical in helping guests make informed decisions about where to stay. Reviews Principles Contributions to Booking. Whether negative or positive, we'll post every comment in full, as quickly as possible, after it's moderated to comply with Booking. We'll also provide transparency over the status of submitted content.
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