Customers expect fast delivery.
The Convenience Wars have begun!
Many years ago, a smart hotelier thought, “Let’s put a mint on the pillow at night.” Guests liked it, and it wasn’t long before the hotel across the street heard about the amenity and began putting mints on its pillows, too.
The Amenity Wars had begun.
Shortly after that, another hotel started giving guests free newspapers in the morning. Once again, it wasn’t long before other hotels followed suit. Then came fluffier towels, nicer toiletries, free coffee, bottled water and more. Each time one hotel did something different, and the guests liked it, other hotels would copy the idea.
It’s happening again, only this time instead of an amenity in the form of a mint on the pillow or a newspaper, it is in the form of convenience. Specifically, convenience that saves customers time and energy in the form of fast, free delivery.
Amazon has been doing this for years. Customers pay an annual fee for a Prime membership. At the beginning it was all about free two-day shipping. Today it’s even faster shipping. This past April, Brian Olsavsky, CFO at Amazon, told analysts that Amazon was moving the standard delivery time from two days to one. In addition to free shipping, Amazon gives its Prime members movies, music and more. More than anything, though, customers still love that free shipping. Then there’s grocery delivery, which can take as little as two hours.
Rivals Walmart, Target and even Best Buy have jumped into the convenience game too. With all their physical locations, these big-box retailers offer a convenient experience to their customers with the option to buy online and pick up in-store. Consider that 90% of the U.S. population lives within 10 minutes of a Walmart. That’s pretty convenient – but why go pick up the merchandise when they are willing to bring it to you?
This past May, Walmart announced free next-day shipping would be available to 75% of U.S. customers by the end of the year. Next, Best Buy announced it would provide free next-day shipping on most of its items (excluding some larger appliances like refrigerators and widescreen TVs) to 99% of its customers. And Target now offers same-day grocery delivery for most customers.
Who is the winner in the convenience wars? The customer!
The goal is to make customers enjoy their experience so much that they won’t leave, but remain a loyal customer – even a brand advocate. As these retailers – and others – duke it out, the consumer gets the benefit. It all comes down to a better customer experience. In this case, it’s a speedier experience, one that saves the customer time. Customers love to save time!
Just last year I wrote a book, The Convenience Revolution, that identified six areas of convenience. One of them was delivery. Taking whatever you sell to the customer is a convenient experience. It’s a disrupter. Consider that back in its humble beginnings as an online bookstore, Amazon disrupted traditional brick-and-mortar bookstores by offering a more convenient experience, which included delivery. When I was a kid, my parents chose one pharmacy over another because one delivered and the other did not. Amazon disrupted an industry while a local pharmacy disrupted its competitor down the street.
By the way, “free shipping” is not really free. Someone is paying for it. It may not show up as a separate line item on an invoice, but it’s there. It’s baked into the price of whatever you’re buying. Or, in the case of Amazon’s free shipping, it is subsidized (at least partially) by the customer’s annual Prime membership. Yet to the customer, it is free shipping, even if the price of the product – while still competitive – is a little more expensive.
Customers are now trained to expect a good customer experience. Part of that experience is convenience. Part of that convenience is delivery. The bottom line is, create the convenient experience your customers want and appreciate, and you will create loyal customers who may even turn into brand advocates. That spells success for you and your business!