Small Business Logistics to Become Hyper-personalized

Delivery will become hyper-personalized – transforming how Asia’s entrepreneurs and small businesses grow, connect and compete globally

The biggest trend in logistics right now is arguably not artificial intelligence, blockchain or even visibility, It’s personalization – which is ushering in a new era of delivery once only accessible to big global companies and corporates.

For Asia’s legions of entrepreneurs and small businesses – more than 70 per cent of whom are now exporting beyond Asia Pacific – personalization offers new opportunities to compete and create competitive advantage.

Already, the transport and logistics industry is at a threshold moment in terms of the use of personalization – the ability to dynamically and uniquely tailor the shipping experience to any customer or individual.

Yet while many micro-businesses believe in the power of personalization for their brand – allowing consumers to choose the color of a dress, say, or add a monogram to a handbag – far fewer know that tapping new customization and personalization strategies in logistics is easier than ever.

So just how can Asia’s small businesses deliver greater personalization in the shipping experience? And use logistics to gain ground against often older, larger or more established brands?

Logistics made just for you

Consider FedEx itself. We have always operated beyond the norms of what’s expected for a shipping company. We know that our company is more than just packages shipped – it’s what we deliver that matters, such as dreams when a start-up sends out its first packages; joy at Chinese New Year; even hope when shipping relief supplies.

What’s more, while the most important aspect of the growing $4.5 trillion e-commerce economy is shipping[1], we recognize that to many, it’s largely invisible.

From the FedEx vantage point, we must showcase the value of what we deliver, which has always been outstanding customer experience – connecting people and possibilities that bring the world closer together. This is equally true for any small business whose customers also rarely think about the logistics and transport behind their package.

So what’s changing and what’s important when it comes to customization and personalization, in a world where 11 per cent of global GDP is already directly attributable to digital technologies?[2]

The first step is to change our mental model that logistics is something that happens after services and products are sold.

Just as WeChat has evolved into a billion-dollar ecosystem of apps, products and services[3] creating hyper-personalized experiences from start to finish – be it in food, clothing, paying utility bills or even shipping a package using the likes of FedEx, so too is the delivery experience starting sooner.

For instance, we now help SME e-tailers at the frontend to close more business on their website, or on the backend in after-sales service, matching shipping strategies with customer needs.

Innovation itself is also more mobile – it’s estimated that around 90 per cent of logistics today happens behind the mobile phone – meaning that we must deliver differently.

Our ‘new normal’ of personalized logistics is all about connecting customers with greater convenience – same-day deliveries, more ‘last mile” choices including self-collection locations; even new, advanced tracking that can nickname shipments and create personal ‘watch lists’.

Visibility is yet another way to personalize the shipping experience – since knowing the status of packages and having control over them is at the top of any customer’s wish list. Take FedEx Delivery Manager for instance, which can request delivery notifications, sign for deliveries in advance, have shipments delivered to a secure location, suspend deliveries and more.

Here, personalization is about driving greater flexibility – with the ability to customize and select powerful day and delivery options – usually at no extra cost to an SME or its customers.

More than ever, consumers want more from their supply chain and logistics – the ability to return goods to a physical location; the ability to get a text message saying goods are about to be delivered today; track product requirements online; vary the delivery window and location, even the ability to “click and collect” – collecting goods from a secure location like a locker box or 7-11 store.

We’ve also seen growth in customization and postponement which is giving SMEs more options to manage inventories more efficiently. By delaying product packaging and assembly for as long as possible, exact customer specifications can be met whenever products are needed.

But that’s just the start. Our industry is at a tipping point, barely scratching the surface of what’s possible as customers expect more, and demand more.

The personalization of everything

In the future of logistics, it’s set to be personalized everything.

Already, shipping is moving further away from a generic or one-size-fits all approach to a highly personalized pattern of world commerce – with the ability to customize, flex and individualize delivery in ways that are just only beginning to become clear.

Just as brands that create a personalized experience are growing two to three times faster than their peers – and seeing revenue increases of up to 10 per cent[4] – so too will small businesses be able to create one-of-a-kind supply chains that help them grow, compete and connect globally.

As Alan Kay once said: “The best way to predict the future is to invent it” – so we are working on a number of technology innovations that will further change the way we do business and the way we serve our customers. But what can we expect to see?

Amongst a multitude of on-demand style innovation, the day is coming where the ultimate personalized logistics accessory of the future will be the ability to book a FedEx shipment by talking to your digital personal assistant.

Picture a small business customer initiating the process, answering questions from the digital assistant, hands-free and paper-free, to complete a booking – with one of our couriers, or robots, zipping to your home or SME office to pick up the package.

So why should Asia’s entrepreneurs & SMEs care?

Such personalized innovation – existing or futuristic – is impressive, but why should SMEs care?

Because we are at an unprecedented moment in history in terms of connectivity – where more and more customers and consumers are becoming hyper-connected across multiple devices – ranging from mobiles to smart phones to wearables and even home appliances.

This personalization of connectivity – where we’ve moved from walking among 100,000 products in a store to accessing more than 10 million products on a phone is giving today’s small businesses the opportunity to compete on customer experience on a scale never seen before.

Even now, 2019 is shaping up to be a banner year for small businesses – four in five of whom are already using e-commerce, and 64 per cent of which expect to see an increase in e-commerce revenue in the next year.

As we move closer to 2020 – a year when customer experience is expected to overtake price and product as the number the key brand differentiator – the opportunity for Asia’s SMEs is now.

In fact, the ability to compete on customer experience using personalization is open to businesses of all sizes. And it may just be small businesses that win the future battle for personalization.

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[1] Air Cargo Management Group E-Commerce Revolution Report, Oct 2017, https://www.ajot.com/news/global-e-commerce-expected-to-double-in-next-five-years

[2] AU Govt / Data61, https://www.afr.com/technology/data-digital-technology-investment-to-lead-to-15-billion-gdp-win-data61-20180731-h13cv2

[3] Some mirrored messaging regarding WeChat, New York Times, How one app came to rule china https://www.youtube.com/watch?v=sRzgzyhafzM

[4] BCG research, 2017 multiple sources including https://www.bcg.com/en-au/publications/2017/retail-marketing-sales-profiting-personalization.asp

   E-Commerce, SME