When it comes to online shopping, consumers demand instant or near-instant gratification. But the last mile of the package they purchased is always problematic, making it almost impossible to meet demands in the short amount of time your consumers expect.
Not to mention, last mile deliveries are inefficient in locations where there are greater distances between destinations and it has proven to be expensive for both vendors and buyers, using up to 53% of the total shipping cost of an item.
Enter Data Analytics
Data analytics, the “qualitative and quantitative techniques and processes used to enhance productivity and business gains”, can and has already started to revolutionize last mile logistics. It already helps companies in the industry to sort through their data for patterns and behavioral information to improve efficiency, track customer demographics, and make predictions.
But in last mile deliveries specifically, data analytics can enhance:
- Performance and the quality of deliveries
- Operational efficiency
- Service levels
Advanced analytics in combination with machine learning can help companies to better understand the operational environment, customers, and urban markets. Using this combination can reveal customer-specific insights that would otherwise remain hidden or take too many resources to identify.
This combo can also be used to analyze high-resolution GPS traces in conjunction with telemetry data and transactional records to uncover relevant insights on the availability of local infrastructures such as roads and parking. It can also reveal behavioral patterns of drivers and delivery crews that know their routes better than any algorithm and extract this knowledge to improve planning and delivery instructions.
Companies can use data analytics to provide accurate delivery planning which maximizes service levels and minimizes cost inefficiencies. This also helps develop near-term predictions of traffic dynamics, available resources, and real-time information on factors that could influence the logistics such as weather.
And last but not least, advanced analytics helps companies during their decision-making processes, from tactical planning to day-to-day operations for fast and responsible last mile distribution.
Enhancing Customer Experience
Dissatisfied customers will not do business with companies that failed to meet their expectations. This is why most companies have become customer-centric, making it that more important to catch up and provide services that meet the increasing consumer demands. By implementing an analytics program, companies can drive and improve customer:
- Loyalty and retention
- Segmentation and targeting
- Interactions and personalization
According to a survey by Capgemini and Oracle, 44% of business leaders found that managing customer satisfaction is a high priority when it comes to understanding customer needs—and the best way to gain relevant insights is to analyze historical data.
This why it is recommended that logistic managers create a supply network and distribution operations that enhance the client’s perception of value, especially when it comes to delivery time and quality.
Furthermore, the correct analysis of customer data can help companies that develop multi-channel strategies to define and target each segment of their client base. By creating contextual information from the customer’s online and offline behavior, companies can optimize logistics efforts in the last mile delivery experience.
Conclusion
According to Aphrodite Brinsmead, senior analyst at Analyst Ovum, companies should:
“Look at ways to connect the content with customer data so customers receive personalized information based on their preferences. By having information on typical customer journeys and support questions, the organization can predict what information a customer needs.”
Perhaps this is the best part of having an analytics program in place—it engages your customers through personalized experiences, which makes them return for more. Looking at it this way, investing in an analytics program can drive significant ROI and clear up otherwise convoluted last mile operations.
Today, technology is essential for logistics managers that enlist all of their efforts in creating sustainable operations that improve efficiency, customer experiences, and provide an advantage in the competitive market.
