Smart City Planning Will Improve Online Retail Delivery
Even as infrastructure spending lags, smart city planning is on the rise, and it’s directly tied (among other important human and environmental statistics) to consumer behavior.
The purpose of a smart city is to intelligently manage the city’s assets, using integrated information and communication technology based on urban informatics, so as to improve the efficiency and sustainability of services.
So, why and how is smart city planning going to affect how you shop online?
Online shopping trends are evolving (as always).
As online orders continue to 23% year over year, and in much shorter shipping times to crowded urban centers, logistics planning, specifically for last mile delivery (the most challenging leg of the shipment), will be a major component in who fails and who succeeds in online retail.
With 80% of Americans shopping online at least monthly, and shoppers living in metropolitan areas spending the most annually, it should come as no surprise that next day delivery no longer holds the same turnaround time prestige it once did. In March 2017, Amazon launched a FREE two-hour delivery service in the Milwaukee area, adding to its Prime Now service, already available in more than 30 U.S. cities. Customers enjoy a selection of thousands of items from groceries, to restaurant delivery, household goods and more.
But this is just one example of why last mile delivery has become so critical for online retailers. Online orders for a variety of product types such as electronics, apparel, entertainment, health and beauty, as well as food, are expected to swell to $1.35 billion by 2018. Anticipating this surge in transportation delivery needs, with the knowledge that traditional methods such as USPS, FedEx and UPS may not be able to sustain this capacity, the industry is actively testing alternative modes of delivery such as local regional carriers, drones, and click-to-collect locations.
Smart City plans and challenges are being implemented worldwide. Both developed and developing countries such as the United States, Australia, and India are moving fast to cultivate urban areas that create high quality of life and sustainable economic development in key areas including transportation, environment, and economy.
For example, in December 2015, the U.S. Department of Transportation launched the Smart City Challenge, in which cities across the country were asked to generate ideas for an integrated, innovative “transportation system that would use data, applications, and technology to help people and goods move more quickly, cheaply, and efficiently.”
The department reported an unprecedented response with nearly 80 applications and a wide variety of pioneering tactics to wrestle urban mobility challenges. One innovative approach from New Orleans is to create routed on-demand minibuses that provide affordable first and last mile delivery services. In Seattle, the idea is to use shared data to dynamically route delivery traffic, utilizing off-peak delivery times, and enabling car share operators to deliver packages.
