Introduction to Hyperlocal On-Demand Delivery Model
Keeping customers happy is a never-ending task, especially when you're dealing with the eCommerce industry. Customers were initially ecstatic to be able to receive any items at all from across state lines. An art connoisseur in Bangalore was suddenly able to get a painting from Shillong, so she didn't care if it took 6-10 days or even longer. However, now such deliveries have become commonplace. So e-commerce businesses had to get creative and teamed up with the logistics industry to offer scheduled delivery, two-day delivery, next-day delivery and even same-day delivery.
But customers are ever consuming and the logistics industry is ever providing. It enters hyperlocal on-demand delivery. This delivery model takes same-day deliveries to the next level, offering deliveries within 45 minutes to 4 hours. Especially during the early lockdown phases of the pandemic, these hyperlocal on-demand delivery services were how most households were able to purchase their daily groceries without taking unnecessary risks to their health.
Even now, as normalcy has returned to the country, many households have chosen to continue using these hyperlocal delivery services simply for convenience. And who can blame them! In this article, we're going to break this delivery system down for you so that you can see if the hyperlocal on-demand delivery model is what you want for your business.
How to Set Up a Hyperlocal On-Demand Delivery Model
If you're still reading, that means we've piqued your interest. I'd love to chalk it down to my incredible narrative style, but chances are you're more interested in how a hyperlocal on-demand delivery model works. The phrase on-demand in itself implies that customers make their demand and then get the product within a short enough time frame that they don't need to demand twice.
But how do you set up a system like that, especially in localities where you may not be headquartered? It's actually quite simple and only requires careful planning, strategic implementation of ideas and intelligent use of a wide range of resources. Keeping in mind that local vendors play a huge role in hyperlocal on-demand delivery, here are the steps you need to follow to get your hyperlocal on-demand delivery model set up.
1. Identify your Industry
The Hyperlocal on-demand delivery model works most effectively for a specified list of industries. Food, pharmaceuticals, groceries, services, and electronics are just a few on this list. More and more industries are indoctrinating the hyperlocal on-demand delivery model keeping in mind the restrictions on weight and fragility of products being delivered.
2. Choose a Specialty
This is what you would call an optional step as choosing a specialty or a niche within an industry may have various advantages and disadvantages. In most cases, narrowing down a specialty makes it easier to select a target market and allows you to operate with minimal competition. However, selecting a niche market may also not necessarily be sustainable for your business or the industry you’re in.
3. Scope Out Your Target Market
Your target audience is essentially your profit. Honing in on the exact market you will be serving enables you to do two important things. The first is, it allows you to project your order volumes in specified locations.
The second is that it enables you to perfect your services to perfectly suit that target market, giving you advantages that help you take over the competition. Like if your target market is working professionals, you can provide options for scheduled deliveries.
4. Build Your Delivery Network
Remember how I said your target audience is your profit? Well, it’s half of your profit. The other half is what you receive from various partners. The beauty of the hyperlocal on-demand delivery model is that it is a joint venture. It makes use of resources provided by various different sources from delivery aggregators to local vendors. All of these together make up your strong hyperlocal on-demand delivery network.
5. Finalise Your Revenue Model
Once you’ve decided who you’re partnering up with for what, you can finally put together the final tally of numbers. These are the numbers that will indicate the sustainability of your hyperlocal on-demand delivery model.
This maps out exactly how you will balance out the commissions given by partners, costs paid to other charges and delivery fees paid by customers. This model may keep changing over time as business picks up and rearrangements need to be made.
Market Impact of Hyperlocal On-Demand Delivery Model
Hyperlocal on-demand delivery works like Superman's heat ray: it's fast, precise, and highly effective. So much like with the boy in blue, it may make you wonder if other players in the industry (be it the superhero industry or the logistics industry) are rendered obsolete.
The answer is a resounding no. At the end of the day, we need surgical strikes just as much as we need wide-range strikes. You can get groceries for your home in Bangalore while still getting that painting from Shillong.
In fact, these two markets are constantly intertwining and finding new ways to learn from each other and beat each other. With that in mind, here are some of the major advantages that a hyperlocal on-demand delivery model can bring to the entire logistics and Ecommerce markets.
1. More competition
Competition is the best way to learn. Using the hyperlocal on-demand delivery model gives traditional stores and ecommerce stores a chance to compete on a level playing field. Through this process, both industries are able to share resources and pick up more tricks to compete in larger markets.
As tech keeps updating for the hyperlocal on-demand delivery model, both sides will have to compete to stay updated. This process enables the quality of services provided to keep improving.
2. Use of local vendors
Traditional stores are given greater exposure to the various elements of logistics technology as well as an opportunity to partner up with other businesses like ecommerce companies to sell more stock. Local vendors have the opportunity to make use of the entirety of their resources, from personnel to stock. They’re also given a chance for greater outreach and to deliver to a wider range of customers. This can also increase brand awareness for the store and give them access to a more streamlined delivery mechanism.
3. Faster Delivery
The hyperlocal on-demand delivery model can sometimes become a race that resembles video game speeds. This is because a major USP of the hyperlocal on-demand delivery model is these fast delivery speeds that promise customers delivery completion within 45 minutes to an hour.
Even in the case of scheduled deliveries, vendors and delivery agents need to complete the task within a certain time frame to ensure the safety and freshness of the goods and avoid the repetition of effort.
4. Tech-Enabled Visibility
Another major USP of the hyperlocal on-demand delivery model is that it makes optimal use of all types of technology to provide these services in the most efficient manner. IoT and RFID (Radio Frequency Identification) help to track orders in real-time and allow customers to do the same.
Seeing their orders en-route enables customers to better prepare for the arrival of the order. Furthermore, greater visibility is granted in terms of route optimization and cargo safety. And the final notch of convenience is that all orders with a particular hyperlocal on-demand delivery model can be managed from a single app.
5. Reduces Logistics Costs
The hyperlocal on-demand delivery model combines fast delivery speeds with intuitive technology and maximum resource utilization. A natural result of this combination and a well-planned system will be a reduction in costs. This is because more and more processes within this complex infrastructure can be automated to reduce manual efforts, reduce wastage and optimize delivery speeds and customer experience.
Customers may be more inclined to pay delivery fees and other fees that cover your logistics costs when the experience is better. Plus, having a well-established network of reliable partners also gives room for negotiations and mutually beneficial financial arrangements.
Many Ecommerce businesses are taking the added leap to a hyperlocal on demand delivery model, attempting to create a bridge to these slowly-growing delivery services. We've enumerated the reasons why this works, from greater visibility to faster tracking, all things that add up to a top-notch customer experience.
With a well-crafted hyperlocal on-demand delivery model, you can serve customers their expectations with a heaping side of benefits that they didn't expect, like discounts and offers laid out by local vendors. Speaking of local vendors, this system of delivery also gives you a chance to make use of typically underused local vendors and severely reduce the wastage of resources. The hyperlocal on-demand delivery model has helped many companies provide a wider range of delivery options and truly maximize their order fulfillment.