Will Shipping by Drones Change Ecommerce Industry?
A number of business enterprises have, in the recent past, tried to ship their products through drones. Understandably, the strategy has created ripples across the world and inevitably, both expressions of astonishment and scepticisms have been flowing in. Even after carefully considering claims that for most enterprises, it has been nothing more than a publicity-gaining exercise, it is no doubt a trendsetting move, if done well. For now, though, authorities in different countries have been resisting the move. For example, the Federal Aviation Administration in the US has vetoed Amazon’s plans for employing drones.
But, assuming that drones are allowed to deliver products in the future; will it revolutionize the ecommerce industry? It will, in a lot of ways but not before several hundreds of local shippers are laid off or carriers lose a bit of their business.
Here is how drones can change the ecommerce industry:
Faster, hassle-free delivery
Acquired drones will not be dependent on third-party carriers to deliver products to customers. Depending on drone make and quality, customers will have their products delivered at their doorsteps faster which may result in improved customer experience.
Modified supply chain
When you are almost taking carriers out of the supply chain, it will require a total overhaul of your supply chain process. Drones will replace carriers in a lot of cases. Drones will be loaded with your products before they take off for various customer destinations. Another significant possibility is the drastic reduction on manpower reliance. Big corporations do not let any opportunity to cut expenses. Should Amazon really totally employ drones, a lot of people face the risk of losing their jobs, especially those in the supply chain.
Will customer experience really improve?
While customers may love the idea of receiving their products faster, are they going to like the idea of coming out of their gates to receive the consignment? Clearly, drones have limitations when it comes to accessing areas — they cannot sneak into corridors or narrow lanes — they will follow a predefined or preconfigured path. So, what happens if a customer stays at a place which is off limits for drones? Will the customer come out and walk quite a few meters to accept the consignment? This possibility strikes right at the heart of doorstep delivery strategy, which has been such a huge hit with customers so far. This is a complex issue ecommerce retailers must address before launching the move.
How many ecommerce retailers can afford to employ drones?
Drones are, and will be expensive. While giants like Amazon and eBay can afford to buy drones, smaller and mid-sized ecommerce retailers will find drones out of their reach. Such retailers will continue to employ traditional supply chain models although some of them may partially deliver with the help of one or two drones. Even then, their costs are going to escalate.
Shift in balance
If the ecommerce biggies invest big on drones (and they can) and employ highly advanced and efficient drones, it might create a lopsided ecommerce industry with smaller and mid-sized ecommerce retailers at a disadvantageous position. They risk Amazon and eBay poaching on to their customer base unless they develop a smart counter strategy.
How else do you think drones will affect the ecommerce industry? What counter strategies do smaller and mid-sized online retailers need to develop in order to survive in the market? Comment below!
If you are an ecommerce entrepreneur, you might also like to check this video.
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