Online shopping is fast and convenient—but only if the delivery process goes smoothly and your order arrives at your door promptly and in perfect condition. Naturally, customers want delivery to be not just convenient, but also as affordable as possible—ideally free—and sustainable. Welcome to one of the most complex challenges in e-commerce. For over 15 years, Comsysto Reply has been building complex e-commerce solutions for clients across all industries. At the same time, we track and analyze relevant trends in our e-commerce lab to ensure we are ready for tomorrow's challenges today. We share our insights here—every Tuesday!

The dilemma of time, money, and sustainability

The EU recognized the sustainability issue over a decade ago. Since then, online retailers have been permitted to charge customers for return shipping to help curb the flood of unnecessary deliveries (Spiegel Online). Whether they actually do so, however, is an entirely different matter. A good 75% (Ecommerce News) of the largest German online retailers do not, and there are good reasons for this.

For younger customers in particular, free returns are a decisive factor in online shopping satisfaction. Consequently, it can end up being more expensive for retailers to pass return costs on to their customers—at least when done explicitly.

Data from Statista also highlights the dilemma mentioned at the beginning: "fast delivery," "affordable delivery," and "sustainability" are roughly equally important to consumers. It is only when you ask about hard trade-offs that a clearer picture of actual preferences emerges. According to the same study, 65% of Gen Z users are willing to wait longer for their deliveries if they are free. This explains why low-cost competitors from Asia, such as Temu and Shein, generated over one billion euros in revenue in Germany shortly after entering the market (Onlinehändler News)—despite delivery times that can sometimes take weeks.

At the same time, shipping costs in Germany have risen by a full 12% over the last two years (Ecommerce News). The main reason for this is the increase in delivery costs, primarily due to inflation and energy prices, which have long since been passed on to end consumers. Even giants like Amazon and Zalando are becoming more restrictive when it comes to free returns.

Does it always have to be home delivery?

One effective way to make deliveries more sustainable and cost-effective, at least in urban areas, is the use of parcel lockers. Dozens of packages are dropped off at a single location, and the customer picks them up at their convenience. It is flexible and affordable—but not necessarily convenient for everyone.

Much like with electric mobility, we are facing a classic chicken-and-egg problem: acceptance of this delivery method depends entirely on the widespread availability of the necessary infrastructure. And investing in that infrastructure is only worthwhile if there is clear growth. Whether it's parcel lockers or charging stations, the problem remains the same.

The market leader DHL has recently taken a clear stance on this. Over the next 5 years, the number of Packstation parcel lockers in Germany is set to double to more than 30,000 locations (tagesschau) — significantly increasing coverage density. In 2018, there were only about 3,500 stations; the trend is clear. And yes, the total volume of parcels shipped is also rising during the same period (Statista). However, the growth in the number of available Packstations is clearly disproportionate. There are also other providers that can be used by multiple logistics companies, such as DeinFach (SZ).

Innovative delivery concepts and their technical integration

So far, we have primarily discussed aspects concerning logistics and infrastructure providers or tactical and strategic shipping cost pricing. However, there are also factors that reach deeper into the core of operational processes and require technical adjustments to e-commerce systems.

Take dropshipping, for example (explanation by Mirakl) — here, the merchant handling the sale to the end customer operates entirely without their own inventory. With sufficiently smart and digitized integration of the participating partners, the right one can be selected at the moment an order is placed — for instance, based on the lowest price or the fastest delivery time due to proximity to the end customer.

Not exactly new, but still an important component of any omnichannel strategy, is "Click & Collect." The customer orders online and then picks up the goods at a physical store. Caution is required here regarding the correct modeling and reservation of inventory, but fundamentally, this problem has long been solved. Some retailers are even expanding the model to integrate products from third-party sellers. For example, GLS and DPD now also deliver to MediaMarkt stores, to make packages available for pickup directly on-site.

Another enabler for innovative services is having control over logistics all the way to the end customer, as Amazon does through its own or highly integrated logistics network. This makes it possible, for example, to offer delivery time windows with real-time shipping costs — a clear incentive for end customers to help optimize the delivery route.

MediaMarkt took it a step further last year: customers in metropolitan areas can now opt for express delivery in just 90 minutes for a modest surcharge. As Michael Jaschek shared in his presentation at the E-commerce Berlin Expo in February, the average delivery time for this service is actually under an hour! That is incredibly fast, even compared to a physical visit to the retailer's store. And that is exactly where the product comes from in this case. By tightly integrating the online shop, in-store inventory, and Uber Direct as a last-mile delivery service, they have succeeded in getting goods to the customer's home as seamlessly as they are quickly—whenever things really need to move fast.

That’s it for today—and here’s what’s coming up next

The final example from MediaMarkt is already a great teaser for a bigger topic: Unified Commerce. Especially for retailers active in both the online and offline worlds, this creates potential synergies and cost savings, as well as opportunities for completely new and innovative services for their end customers. And these go far beyond classic omnichannel marketing. We will be taking a closer look at this and more in one of our upcoming issues.

See you next week!

Christian & the Comsysto Reply e-Commerce Lab

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