(Source: Shopify) timely guide to on demand delivery

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A high-impact guide written for entrepreneurs by entrepreneurs.

CONTENTS

CHAPTER 1

Understanding On‑Demand Delivery

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CHAPTER 2

How On-Demand Delivery Works

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CHAPTER 3

Increase Sales by Offering Same-Day Delivery

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CHAPTER 4

On-Demand Delivery Success Stories

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CHAPTER 5

Setting Up On‑Demand Delivery on Shopify

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ABOUT THE AUTHOR

Daniel Asper

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Chapter 1

Understanding On-Demand Delivery

CHAPTER 1

Understanding On‑Demand Delivery This guide is designed to help you unlock the power of Shopify’s same-day delivery option to make more sales and exceed the growing expectations of the modern consumer. Instant gratification is something we’re all familiar with; we push a button and expect things to happen… instantly. That standard has carried over to the shopping expectations of your customers too. Shipping in 3 - 5 business days is cool. But 1 - 2 hours is magic. In the Timely Guide to On-Demand Delivery, you’ll learn how the

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Understanding On-Demand Delivery

service works with real examples from Shopify merchants. Afterwards, see how companies are marketing the service in order to attract customers and increase sales.

The Challenge of Last Mile Delivery Have you ever ordered something online and wished you could just get it immediately? Or that you could you schedule the delivery so your package is waiting for you when you get home from work? Here’s the problem: shipping and mass fulfillment of products is a complex, time-intensive process that many companies are still trying to figure out.

The big logistics players can move mass quantities of products around the world, making it a low-cost and relatively streamlined process to get inventory to your city. It’s that last journey however, to the customer’s front door, that creates the costly challenge.

Last-mile delivery has been a complicated logistical issue for retailers and delivery companies for decades. Recently a number of technology companies have jumped into the logistics space to solve this pain point for both local and international retailers. The result has been the emergence of a few large players who have rapidly gained market share through their easyto-use platforms for consumers and by employing part-time contractors to bridge the last-mile distribution gap in local markets.

What Exactly is On-Demand Delivery?

Companies tackling this challenge are often referred to as on-demand delivery providers; companies at your service when a job has been requested.

On-demand delivery companies, are increasingly empowering local businesses to reach more local customers, and not rely on global logistics companies to move products around their markets.

Simply put, these larger logistic companies optimize to deliver to certain areas in batches, using one courier to service hundreds of awaiting customers. On-demand delivery platforms leverage thousands of part-time local delivery people to bring products to customers immediately -- or as the name goes, on-demand.

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Chapter 1

Understanding On-Demand Delivery

The Upshot: On-demand delivery is the immediate or scheduled delivery of your product to your customer; initiated immediately after they make their order.

This substantial shift has resulted in the emergence of many niche last-mile delivery players around the world in their respective markets -- ie. whoever manages to employ the most on-demand couriers in a city is said to have the greatest “supply” and can therefore service merchants and customers the best by being the most reliable.

So why should you, as a merchant, be interested in this? Mostly because many of the largest retailers in the world have taken note of this shift to increased efficiency in getting products to customers quicker -- it’s a way of offering superior customer service. With the increase specifically in ecommerce competition, delighting your customers by having their package magically appear the same day as they ordered is proving to be a valued differentiator.

Retailers like Amazon, Target and Walmart are taking advantage of on-demand delivery already, working with providers like Postmates, UberRUSH, Doordash, Instacart and Google Express. Amazon Prime is a paid membership level that includes two-day and same-day shipping for some items, making shopping on Amazon that much more enticing.

Programs like Amazon Prime and other on-demand delivery services are driving millions of dollars of sales, appealing to the immediacy and instant gratification customers get with a new product in their hands.

On-Demand Delivery with Shopify While you may not be running a multi-million dollar operation (or maybe you are), Shopify is working to ensure you can compete in both the international and local markets. And that means bringing the on-demand delivery option to your customers.

Working with UberRUSH and Postmates, Shopify merchants in select cities can enable the feature for their stores so that local purchases can get delivered instantly. Before enabling on-demand delivery though, it’s important to evaluate how it fits into your business and your customers’ 3

Chapter 1

Understanding On-Demand Delivery

experience. In the following chapters, we’ll explore how on-demand delivery works and how you can use it to drive traffic and increase sales.

The Upshot: Offering same-day delivery through UberRUSH or Postmates incentivizes local customers to shop with you because you can offer the same or a better level of service than your larger competitors.

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Chapter 2

How On-Demand Delivery Works

CHAPTER 2

How On-Demand Delivery Works Logistics Think of on-demand delivery as the key to unlocking your local marketplace. Within this marketplace, merchants, customers, and couriers work together to connect local sellers to local buyers, allowing you to compete with your global retailer competition. On-demand delivery allows you to use your understanding of the local population and the events happening in your neighbourhood or city to expand your local customer base and differentiate your brand.

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Chapter 2

How On-Demand Delivery Works

Local Customers

Nationwide & International Customers

On-Demand Delivery (Postmates, UberRUSH)

Shopify Shipping (USPS, Canada Post)

$11

$6

Avg. Delivery Time

46 mins

3 Days

Fulfillment Process

No label printing or extra packaging required

Average packing time: ~5hrs/week

Additional Details

Same day with specific delivery time window scheduling

Print shipping labels within Shopify and save up to 40% on postage rates

Shipping Type

Avg. Price

~15% of all orders originate within a 15 mile radius of merchants

Price Pricing for Shopify’s current partners is based on a combination of time and distance to your customer. Both UberRUSH and Postmates start between either a $5 or $6 flat rate and charge based on time and distance thereafter.

Level of Service Shopify partners are required to provide a high standard of service -delivery couriers are professional and supplied with the equipment necessary to get your products to customers as if they bought it in store themselves.

Couriers may deliver products by foot, bike, or car.

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How On-Demand Delivery Works

The Upshot: When you fulfill an order with on-demand delivery, you set the wheels in motion for the delivery partner to coordinate product pickup and drop-off between you and your customer.

How On-Demand Delivery Works

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Chapter 3

Increase Sales by Offering On-Demand Delivery

CHAPTER 3

Increase Sales by Offering Same-Day Delivery Not to be overlooked is the fact that just having on-demand delivery as an option presents opportunities for you to stand out and reach customers in new ways.

In a recent survey, 49% of shoppers said that same day shipping would make them more inclined to shop online; however, only 15% of global retailers offer same-day delivery. Identifying opportunities to cater to local

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customers helps you differentiate your brand, attract new local customers, and convert sales based on the fact that you provide an immensely important service that 85% of your competition can’t offer.

The Upshot: On-demand delivery is your window into growing current and future local customer conversions and relationships.

Run Local Campaigns You know your community better than any large big-box retailer and you need to take advantage of that. Keep your finger on the pulse of the local events scene and experiment with timely social ad campaigns or even physical marketing assets (like flyers or billboard space) during events. For example, if there’s an influx of tourists coming to town for a music festival, appeal to their musical tastes and give them something to remember their short visit. Same-day delivery means you can deliver directly to your customer’s hotel before they leave town.

Segmented Email Marketing You may also think about launching email campaigns targeting current customers notifying them of your new speedy service or guaranteeing free same-day delivery to blow out excess inventory. Mailchimp reports that segmented email campaigns achieve much higher open rates than those that aren’t sliced and diced, so don’t forget to be selective for the best results.

One effective way to segment is to look at customers who very recently purchased something from you. Offer complementary goods that can be added right now or a must-have item that goes with their recent order. Learn about segmentation strategy in Shopify’s guide to email marketing.

Actively Advertise Same-Day Shipping Once you imagine how your products might be used in a local context or why your customers should have them the same day, identifying the

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Chapter 3

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keywords people search when they need something right away can help you get your products front and centre.

Search advertisements present a massive opportunity to use on-demand delivery to make your ads stand out and to capitalize on the immediate needs of the local population.

Don’t forget, Shopify offers new merchants a $100 of AdWords budget after you spend your first $25, so make sure to take advantage.

Think about searches conducted with urgency, for example, “last minute gift ideas” or “easy halloween costumes.” People using these terms value ease. A geo-targeted search ad triggered by keywords might look something like this:

Leverage Facebook Ads Don’t forget about leveraging Facebook carousel ads too to display multiple messages. Take this Frank & Oak mobile ad for example. In one swipe, the user can view Frank & Oak their products, get them delivered in 2 hours, and download the new app as well.

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To learn more about Facebook advertising, check out Shopify’s blog post: An Introduction to Facebook Ads for Ecommerce. While you’re there, you may want to learn about Instagram Advertising too.

Flash Sales Flash sales can create a lot of buzz, and while it seems that everyone’s doing it these days, pairing immediate delivery can differentiate your offering.

Besides generating revenue, brand awareness, and social buzz, the objectives associated with holding flash sales generally are to: • Up-sell • Cross-sell • Foster customer loyalty

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The Upshot: The urgency generated by a flash sale, combined with the immediate gratification of same-day shipping can generate a unique, memorable experience for your customer.

Undoubtedly, it has becoming increasingly difficult to reach these goals as inboxes are bombarded with blow-out sale offers, ultimately creating flash sale fatigue. With on-demand delivery, you have an advantage.

Urgency is in the DNA of both flash sales and same-day delivery -- so why not offer flash sales on the delivery itself? For example if your sales dip on Tuesdays, experiment with offering 50% off, or free, on-demand delivery between 2pm - 4pm. Remember you’re in full control of how much of the delivery cost you absorb. Try incorporating your flexible delivery options into exciting flash sales and see what happens. Here’s a few more ideas: “Buy X before noon and it’ll be on your doorstep when you get home” or “Get everything hand delivered today when you spend over $100.”

On-Demand Delivery for In-Store Purchases A successful shopping outing results in a lot of bags to carry. That struggle however can be alleviated for your in-store customers with on-demand delivery as well. Shopify’s point-of-sale (POS) system integrates Postmates and UberRUSH so in-store purchases can be picked up and delivered by courier instead of carried out by the customer.

The key here is to ensure customers are aware of the service so they don’t limit their shopping to what they can carry. Small signs placed throughout your retail space should do the trick.

Consider Absorbing Shipping Costs Free shipping is the number one driver of online shopping conversions according to a 2016 survey. In addition to that, the same survey showed that 49% of customers would be more likely to shop online if they could get their products same-day.

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Chapter 3

Increase Sales by Offering On-Demand Delivery

The average cost of shipping with on-demand delivery providers is roughly $12. Within a 1-mile radius; however, UberRUSH can be as cheap as $6 (based on location, additional mileage can cost as low as $1.80/mile). The average time to get to customers is between 30 minutes and 60 minutes.

The average cost of ground shipping is ~$7 and the average time to get to customers is 3 - 5 business days.

The Upshot: While on-demand delivery can sometimes cost you, the merchant, more money, the benefit to the customer far outweighs the increase in cost.

Offering steep discounts or even free shipping for standard ground over a certain cart-size threshold has become a staple for many businesses to increase conversion online. In fact, free shipping was recently the biggest driver of customer’s likeliness to shop online -- your customers are 88% more likely to make a purchase if shipping is free. Imagine the impact that has when that package is also received within a few hours.

Absorbing some of the cost to match regular ground shipping along with delivering the goods immediately is now a powerful tool at your disposal; small change that can make a big impact.

Step by step, here some screenshots to walk you through how to reduce shipping costs to your customers: Make sure you’re in the “Shipping” tab and click “edit” in your Shipping zones settings.

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Once you’re on the edit page, scroll down until you see your opted-in on‑demand delivery carriers.

Enter the fee reduction you’d like to provide to your customers and it will be automatically applied at checkout.

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Try experimenting with setting basket size constraints as well in your on-demand delivery settings, for example you can choose to only offer Postmates delivery for orders greater than $20.

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Chapter 4

On-Demand Delivery Success Stories

CHAPTER 4

On-Demand Delivery Success Stories On-demand delivery services are becoming the new norm for local shipping in big cities. Not only is it getting product to customers faster, it’s strengthening the relationship between brand and buyer.

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Chapter 4

On-Demand Delivery Success Stories

KITH Looking to better serve its New York City customers, KITH, a contemporary menswear brand, enlisted Shopify and UberRUSH to offer same-day delivery. KITH’s Austin Scotti explains, “Kith is an experience brand. We want our customers to remember the moments they purchased with us. This service definitely ties this in strongly.”

See the full case study on Shopify Plus blog.

Spikeball To avoid the in-store holiday rush its customers regularly experience, Spikeball offered last-minute shoppers same-day shipping. Read more about Spikeball on UberRUSH’s blog.

Sakara Life For a New York City Fashion Week activation, Sakara Life gave away its organic, plant-based meals on-demand. Within two hours, all its meals were sold out. Read more about Sakara Life on UberRUSH’s blog.

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Chapter 4

On-Demand Delivery Success Stories

Campus Protein Having tried three different ecommerce strategies, CampusProtein. com partnered with Shopify to successfully scale up operations. “Thanks to Shopify we’re actually getting back to our roots and offering same day delivery again,” says Founder Russell Saks. With same-day delivery core to the business, CampusProtein.com saw a significant increase in year‑over‑year sales and a 2x increase in conversions. See the whole Campus Protein case study on the Shopify Plus blog.

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Chapter 5

Setting Up On-Demand Delivery on Shopify

CHAPTER 5

Setting Up On‑Demand Delivery on Shopify Eligibility Uber and Postmates are constantly expanding on-demand delivery in order to better serve Shopify merchants everywhere. As of Fall 2016, Uber and Postmates service the following cities:

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UberRush New York

Chicago

San­­ Francisco

Atlanta

Austin

Baltimore

Boston

Charlotte

Chicago

Columbus

Dallas

Denver

East Bay

Houston

Jersey City

Kansas City

Las Vegas

Long Beach

Los Angeles

Miami

Milwaukee

Minneapolis

Nashville

New York

Oklahoma City

Orange County Palm Springs

Philadelphia

Phoenix

Pittsburgh

Portland

Raleigh

Sacramento

San Antonio

San Diego

San Francisco

Seattle

SF Peninsula

St. Louis

Virginia Beach

Washington DC

Postmates

If your city isn’t listed here, check the Postmates and UberRUSH websites for updates.

Beyond simply your location, there are a few things you need before getting started: • • • •

Monthly Shopify plan A store with at least one product Shipping zones setup Shipping address within on-demand delivery zones

Activation and Configuring Settings In your Shopify admin, go to Settings and click Shipping. In here you’ll see Postmates and UberRUSH activation steps. Follow the instructions, understand the terms and manage the settings. You’ll be able to select a variety of settings including same-day shipping or two-day, as well as time constraints (ie. purchases made before 1pm).

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Scheduling a Delivery Once an order has been made, open it up and navigate to Fulfillment. Here you’ll have the option to request an on-demand delivery pickup. Review the details and click Request Pickup. It’s that easy.

For more detailed, step-by-step instructions, use Shopify’s Help Center that will walk you through everything you need to know.

Conclusion Product delivery is the closest an ecommerce business comes to interacting with its customers in the real world; it’s an important experience that has to be considered. On-demand delivery has the ability to greatly improve your customer’s experience and enhance the way they think about your brand. No matter how large your big-box competitors are, you have an opportunity to level the playing field.

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ABOUT THE AUTHOR

Daniel Asper Daniel Asper is a former management consultant who made the switch to tech after working in Tel Aviv and San Francisco at Meerkat and Uber. His passion for helping entrepreneurs create something out of nothing is what motivates him to help improve the Shopify experience for new and existing entrepreneurs. Currently he leads the growth and expansion of Shopify’s On-Demand Delivery services.

Disclaimer: Any of the logos, design rights, trade, service or collective marks that are mentioned, used or cited in this book are the property of their respective owners. Their use in this book does not imply that you may use them for any purpose other than for a similar informational use.

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