Evolution of last-mile deliveries amid COVID-19 (with video)

Last mile summit

As e-commerce sales are projected to hit over $709 billion in the U.S. in 2020 in large part because of the COVID-19 pandemic, logistics companies are focused on last-mile delivery and improving customers’ experience.

JT Engstrom, chief strategy officer of FreightWaves, and Lakshmanan Chidambaram, president of the Americas for Tech Mahindra, discussed the evolution of e-commerce over the next two years during FreightWaves’ virtual Last Mile Logistics Summit on Thursday.

“Well, we all know how rapidly e-commerce has been growing and we all thought we knew how rapidly it could grow — then COVID happened,” Chidambaram said. 

Tech Mahindra provides information technology and business process outsourcing services and is a $5 billion firm with 130,000 employees worldwide with a significant presence in the logistics space, Chidambaram said.

He said the COVID-19 pandemic has accelerated e-commerce adoption “in ways that none of us could have imagined.”

“What we are now seeing is an explosion of people ordering everything,” Chidambaram said. “They want it to be frictionless and contactless from a payment perspective or from physically touching in any possible way.”

Ensuring customers have the best possible experience is key during last-mile delivery, he said. 

Being able to build networks and understand customers’ service levels and ensure service delivery is an interesting technology, math and statistics problem, Engstrom said. 

Chidambaram agreed.

“The final-mile networks have become a really significant strategic asset for retailers … and it’s really important for retailers or other shippers to really intimately understand those final-mile networks,” he said. 

Transparency and communication are key to ensuring positive customers’ last-mile experiences, Chidambaram said. Pushing out notifications regarding the status of a customer’s package is crucial, he said.

“What time is it [package] getting delivered, where is the truck at this point in time?” he said. “Mistakes do happen. It could be a mechanical failure of a truck or there could be other reasons why it can’t be delivered on time.”

Chidambaram said focusing on customer experience transformation, which allows third-party logistics companies to “get into the shoes of the customer and then reimagine the experience and then create the product” is critical to gaining their loyalty.

“Many times these products get created without keeping the customer in mind,” he said. “So once you get to understand the customer’s mind and what they want to be adopted, then companies will be able to design an experience and then follow it up with behavior change management.”