Parcel Lockers: Unlocking New Ways To Serving Customers

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By Dr Sascha Hower | Group Chief Operating Officer Singapore Post Group & CEO Quantium Solutions

The rapidly expanding eCommerce landscape in Asia Pacific has made the role of logistics providers in the customer’s purchasing experience more important than ever before. The estimated total for Asia Pacific’s business-to-consumer eCommerce sales in 2014 was USD $525.2 billion, and this continuously growing figure is having a profound effect on the logistics industry.

While the region’s middle class tier of consumers grows, alongside rapid urbanization and higher standards of living, urban population growth has not been met with infrastructure improvements at the same pace. Delivery continues to be an arduous task for many logistic providers. To meet these increasing logistic demands and stay relevant to changing customer needs, parcel lockers are increasingly being adopted around the world. One of the first in Asia, Singapore Post (SingPost) operates over 100 parcel lockers, or POPStations, across Singapore at strategic locations like shopping malls, community centres, train stations and post offices.

Meeting The E-Consumer’s Delivery Demands

According to a 2014 survey by SingPost , in addition to wanting more attractive deals and greater variety of products, online shoppers also desire a better system for delivery and returns.

The survey also highlighted a greater need for more delivery options, flexible courier services and self-collection at the customer’s convenience, complemented with proactive delivery notifications. The modern day consumer has a greater need for flexibility and more control over parcel delivery and returns, so solutions need to focus on delivering more convenience, while being better value for money. And parcel lockers seem to be a perfect fit for this shift in consumer needs. There is also a greater need for secure alternatives to receiving online purchases, particularly so for consumers living in urban areas across South East Asia who make up a large part of the growing online shopping community.

The Plus Points Of Parcel Lockers

The use of parcel lockers has improved delivery fulfilment processes for retailers and consumers alike. For retailers, providing parcel locker services is another opportunity to smoothen the customer’s purchasing journey, making last-mile fulfilment a more pleasant experience for the end-customer.

Better Brand Experience – The flexibility in parcel self-collection entails greater convenience for customers. In fact, SingPost research shows that more than 70% of parcels are collected at their leisure, outside normal office hours and during weekends. Such delivery options differentiate retailers from their competitors and ensure higher customer satisfaction, allowing them to build customer loyalty and brand strength with increased customer patronage.

Fuss-Free Deliveries – Designed for today’s consumers with on-the-go lifestyles, parcel lockers provide customers with greater convenience and flexibility in managing their parcel deliveries. SingPost has a dense island-wide parcel lockers network, with an average 2.5 km distance to each POPStation . Instead of having just one mailing address, one could have access to 100 mailing addresses through parcel locker locations, making it very convenient for customers to collect, post or return parcels. Customers can also enjoy flexible delivery time – according to SingPost, 50% of parcels delivered to POPStations were collected on the same day, while 95% of them were collected within 3 days. With the convenience and flexibility parcel lockers can provide for customers, the entire experience of receiving a delivery becomes more efficient and enjoyable, while minimizing redelivery charges and hassles. A testament to parcel lockers’ success, SingPost’s research revealed that majority of POPStations users found them easy to use, more convenient and more efficient than traditional delivery.

Innovative and Efficient – Parcel locker networks also provide real-time status updates that allow for efficient management of locker spaces, depending on parcel volumes. Furthermore, the use of parcel lockers simplifies the ‘last-mile challenge’ for retailers through the consolidation of deliveries at a single self-collection point. In particular, parcel lockers can be an efficient way to serving customers during high peak events such as flash sales or product launches, where retailers could pre-load lockers to cater to expected order requests for shorter delivery times. On top of revolutionizing parcel delivery and collection systems, parcel lockers are continuously evolving to suit consumer needs. SingPost is working to roll out the Personal POPStation (P-POPS), which individualizes parcel lockers to consumers by leveraging on mobile technology. For mobile-savvy consumers, they can manage their personalized parcel lockers entirely from their smartphones through Bluetooth encryption technology, offering a seamless omni-channel customer experience. Overall, the parcel lockers system provides an innovative solution in simplifying parcel delivery and collection for both retailers and consumers.

Discreet and Secure – Customers are able to collect their packages from lockers by using a personal access code or QR code that is sent directly to their mobile phone , along with an estimated delivery date. Furthermore, the POPStation mobile application has an ‘Air Unlock’ feature that automatically opens parcel lockers within a three-metre radius via encrypted Bluetooth technology . By providing a unique finger slide pattern on the mobile device, customers can be assured personal access to their designated parcel lockers. As such, digitization of parcel locker systems has helped ensure the privacy and security of customers’ online purchases.

Environmental Benefits – Parcel lockers are more environmentally sustainable through the consolidation of deliveries, thus, generating less carbon dioxide than traditional delivery routes to households. Additional Payment Options – Parcel lockers have the added advantage of payment upon collection. This is particularly beneficial in regions in Southeast Asia where Cash-on-Delivery continues to be one of the preferred payment options.

Conclusion

The tremendous growth in eCommerce across Asia Pacific has allowed brands and retailers to reach a wider consumer base much faster by leveraging on digital channels. As customers seek convenient, efficient, low-cost delivery and returns solutions, parcel lockers are set to become a key service in last-mile fulfilment. Providing mobile-focused solutions is particularly important in meeting customers’ needs for greater control and flexibility. This secure, reliable method has proven useful and highly relevant for online shoppers who want greater control over their delivery experience. As for retailers, cost savings is an added bonus, along being able to provide better customer experiences and eventually, greater customer satisfaction in the long run. With the introduction of POPStations, SingPost continues to provide brands and retailers with relevant delivery and returns solutions to meet today’s online shoppers’ needs across Singapore and the Asia-Pacific region.