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Insight of the Day: Should More Retailers Offer Same-Day Delivery To Remain Relevant?

Kohl's Joins the Trend:

  • Kohl's partners with Instacart to offer same-day delivery nationwide, boosting its eCommerce capabilities.

  • This marks a departure from its previous reliance on next-day delivery services.

  • Instacart benefits from expanding beyond its grocery roots into other retail sectors.

The Big Question: Is Same-Day a Must-Have?

  • Consumer expectations are shifting, but the feasibility and cost-effectiveness of widespread same-day delivery remain a challenge.

  • Retailers must weigh potential revenue gains against operational costs and consumer willingness to pay for the service.

Challenges to Overcome:

  • High Startup Costs: Setting up the infrastructure for same-day delivery can be expensive.

  • Logistical Complexities:  Coordinating with delivery partners and optimizing fulfillment processes is essential.

  • Consumer Behavior: While speed is important, reliability and consistent service are gaining importance.

State of the Industry:

  • 2022 Survey: Bringg's survey highlighted that many retailers were ill-equipped for widespread same-day delivery, but recognized the need to adapt.

  • 2023 Outlook:  McKinsey & Company found that while same-day is a growing niche, it still represents a small portion of the overall delivery market

Key Takeaways:

  • Customer expectations around delivery speed are evolving, putting pressure on retailers to innovate.

  • Same-day delivery offers potential benefits, but the costs and logistical hurdles are significant.

  • Reliability and a variety of delivery options might be more effective customer draws than prioritizing pure speed alone.

  • As technology and infrastructure improve, same-day delivery could become more commonplace.

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