E-commerce grew 20% for Costco in fiscal 2015—20 times faster than store sales.
With many trials going on, consumers will soon expect delivery within hours, an e-retailer says.
The rush is on to figure out a way to deliver parcels to online shoppers the same day they place their orders. E-commerce giants like Amazon, Walmart.com and eBay are conducting tests. Google Inc. and the U.S. Postal Service are getting in on the act, as are start-ups focused on same-delivery, such as Deliv and Shutl. What comes out of these trials could have a big impact on how online retailers like me conduct our business.
At this point, the battle is confined to Silicon Valley and a few other markets. But make no mistake—the future of e-commerce will be all about same-day delivery. Companies like Amazon, eBay, Wal-Mart and Google can quickly change consumer expectations and thus the way we do business. Right now local shops are where consumers fill an immediate need, but the same-day shipping wars will result in new options for the busy and time-challenged shopper.
Spreadshirt does face a unique challenge in this business model—we have to balance consumer expectations with our product line, which is based on print and manufacture on demand.
- 1 in 4 Spreadshirt orders are gift items
- 1 in 3 orders relate to events or teams
Therefore, managing consumer expectations and hitting delivery dates is absolutely critical to our success. Further complicating matters is the compressed delivery cycle; every Spreadshirt product is printed upon order with the majority of US customers unaware that their order is printed instead of picked from a shelf. Delivery time is absolutely core to our business but should never be noticed or problematic for a shopper.
Given the urgency of short delivery cycles, we opened a new production facility in Nevada during 2012 to reduce 1 to 2 shipping days from our existing Greensburg, Pa., plant to California and West Coast consumers. We are totally committed to delivering products quickly in the US market and this strategy has assisted in speeding up the delivery process.
Currently, we do not have production facilities within the shipping war zones so we are not yet a contender in same-day delivery. However, to survive and thrive in e-commerce, we must adapt to the new business landscape once same day delivery is offered in many popular markets. We are all accustomed to the price and quality aspects of our competition, but now speed of delivery adds a new dimension. Shorter shipping cycles are ultimately a better experience for the consumer and we are all about the enhancement of the consumer experience. Since much of the shipping battle will be about market share, I don’t expect whatever same-day delivery services that emerge to charge exorbitant rates. My goal is to offer a better consumer experience with a minimal price increase. The net impact of the shipping wars will deliver precisely these results.
The line between retail and e-retail grows finer every day as big outlets known for “bricks” are entering our world of “clicks” for captivating American shoppers. Most Americans have ordered online and they expect wide product ranges, top quality, favorable pricing, and easy return policies—making them very comfortable with online shopping. This level of trust has propelled the e-commerce market as the fastest growing retail sector in the U.S.
In my opinion, price and service wars are ultimately good for the consumer and any good retailer will deliver what the customer expects or will get lost in the shuffle. After all, e-commerce is popular because it offers greater choice, quality, service and price than offline experiences to customers. Spreadshirt will continue with what has worked—providing top-quality print-on-demand apparel and accessories that are not offered offline, with quick delivery. We will continue to move towards faster shipping models and methods that shorten the time between the brands we work with and their loyal customer bases.
Editor's note: Spreadshirt is No. 389 in the 2013 Internet Retailer Top 500.