eDelivery editor Sean Fleming caught up with Jan Onnenberg, co-founder and managing director of German same-day delivery specialist Liefery, which is helping pan-European fashion retailer Zalando offer an ultra-fast returns service.
I’d agreed to meet Jan Onnenberg at the MetaPack Delivery Conference, earlier this month. In retrospect that was a brave thing to agree to do, given the extent to which getting a signal on your phone can be a challenge at the Park Plaza hotel at the southern end of London’s Westminster bridge; you’d do well to put a red carnation in your buttonhole if you want to make yourself easy to identify there.
Having found each other and briefly say hello, we immediately changed our minds about chatting and went to sit in on one of the conference sessions.
Liefery is a name not many are immediately familiar with. It MBO-ed from former parent company Time Matters, and secured investment from Hermes in July 2015, as reported by our colleagues at Tamebay. But it already has some impressive clients, and is now running a trial of a same-day returns service, designed to make life simple for shoppers.
The Instant Returns service it developed is in use by Zalando, operating as a pilot in Amsterdam, Cologne, and Vienna, offering shoppers a same-day pick-up of their returns, which are then routed into the Hermes network. With a 3pm cut-off for same-day collection, and operating as a zero-cost-to-the-customer option, it’s not hugely surprising to hear it’s going down well. It also operates as a service provider to Amazon in Munich.
“Most retailers understand the importance of convenience,” Onnenberg points out. “After all, delivery and collection are the only physical contact some customers have with a retailer.
This is a point borne out by the InternetRetailing UK Top500 (IRUK Top500) report’s operations & logistics dimension, which we reported on earlier this month. Compared with next-day delivery, which the IRUK Top500 found was offered by 63% of retailers, same-day is offered by a relative few … only 6%. Yet it is set to grow, in order to keep pace with customers’ demands for greater convenience and flexibility. The report also found that “all of the Top50 retailers in (the operations & logistics dimension) provide a convenient collections service.”
According to Onnenberg, there’s one name in particular that is putting pressure on retailers to raise their convenience game.
“The biggest driver in this market at the moment is Amazon. What Amazon has done, and is doing, to offer more convenience to shoppers has led to an increasing trend of customer optimisation – you have to bend to the needs of the customer. It’s as simple as that. Otherwise they’ll find someone who makes life easier and shop with them.”
The growth of collection-related services, from Collect+ to Doddle, through to lockers and boxes, is part of the drive to offer more convenience and flexibility, whether here in the UK or elsewhere in Europe. One key difference between the UK and Germany, for example, is the success of lockers (Packstations, to be precise) in the latter market, something which hasn’t really caught on in a major way in the UK. But Onnenberg cautions against generalising on what German shoppers want from delivery services. Yes, he says, Packstations are a common sight, however: “Convenience and home delivery are still key in Germany, despite the proliferation of lockers – lockers will never be as convenient as home delivery.”
The Instant Returns trial sounds like it’s got off to a strong start, as Onnenberg tells me: “Some customers are even asking us about returning things that weren’t bought from Zalando.”
The eDelivery view
It’s clearly a sign of success for Liefery that the Instant Returns service has got customers asking if there’s something similar for returns to retailers other than Zalando, but therein lies one of the challenges facing the sector as a whole.
There is an undeniable rush to get new delivery and collection services out to customers, whether offering same-day, nominated day, or even within the hour. But you can draw parallels with the early days of two other significant industrial periods to see where trouble may be waiting to make itself known.
In the early 19th Century, railways were developed by separate companies, with a common aim – transporting people and goods. But without cooperation or a set of agreed standards, different track gauges were used, meaning you couldn’t take a train from one end of the UK to the other without having to get off and get on another operator’s train – they wouldn’t run on each other’s tracks.
Similarly, the early development of computers led to many different protocols dictating how machines would communicate with each other and a range of peripheral equipment.
In both cases, standardisation has led to things like all trains using the same width track, and the widespread use of everything from USB to wi-fi.
The delivery world should take note. Presenting customers with dozens of delivery and collection options at check out might seem like offering convenience, but it might just as easily create confusion for the shopper.
It also risks diluting money and resources; if a consortium from the industry collaborated on a platform-and-retailer-agnostic series of convenience-led delivery and collection services, shoppers could look forward to not just convenience, but also consistency.
And that consistency, coupled with the advantages that can come from pooled resources ought to make it easier for retailers to feel confident about keeping their promises to the customer.