Hyper-Personal Logistics: Omnichannel’s Balancing Act

By Alex MacPherson, Director of Solution Consultancy and Account Management at Manhattan Associates

Ethical and sustainable behaviour has become a top priority for consumers over the last five years, as the Gen Z age group begins to flex its economic muscles. Much more attentive to the impact of their purchases on the environment and societal, and cultural trends, they are imposing new rules and expectations of brands and organisations.

How can we find the right balance between the ever-increasing demands for seemingly faster, more personalised brand experiences, while at the same time balancing the need to be more sustainable and environmentally conscious as brands and consumers?

DELIVERY VS. ECO-RESPONSIBILITY: THE CONSUMER PARADOX

A recent study published by IFOP and Star Service highlighted that delivery remains the most important criteria for ecommerce customers, more so than price and (maybe) surprisingly, even the product itself. Furthermore, it is also the choice of delivery option that is important to respondents too.

Somewhat unexpectedly, however, at the same time, more and more consumers are expressing awareness and alignment with Corporate Social Responsibility (CSR) and Environmental, Social and Governance (ESG) policies for the brands they choose to shop with.

The same research confirms that they are willing to pay more for environmentally sustainable delivery, while a clear majority (80%) would accept slower delivery if they were assured of more environmentally friendly delivery.

Here in lies the paradox: on the one hand, consumers are saying their buying decisions are influenced by the speed of order delivery, yet the vast majority desire more environmentally sustainable options even if they are ultimately.

FAST FASHION MEETS SUSTAINABLE FASHION

In recent years, two opposing trends have developed in conjunction with each other: fast fashion and sustainable fashion. The former is a major trend in the fashion industry, characterised by the rapid development of collections which are then largely discounted for sale purposes to make way for the next line. Fast fashion requires intense levels of production and transportation, delivered at speed, largely free from any regard for environmental impact.

The second, in contrast, consists of applying ethical and transparent requirements to the clothing value chain (design, production, consumption), with the aim of reducing environmental impact. The expansion of the second-hand market has typified this. Driven by platforms such as Vinted and by brand initiatives like ThredUP at PacSun, Seconde Main at Kiabi, Resell at Ba&sh, and Remade with Love at Maje.

It encourages the circular economy and reuses rather than the production of new products and the often sprawling supply chain networks needed to produce and deliver them.

TOWARDS PERSONALISED LOGISTICS

In reality, these seemingly paradoxical expectations and consumer philosophies should not be viewed in isolation – they are more a reflection of a demand for ever greater personalisation. The same consumer who wants an item delivered as quickly as possible from one brand, may well be prepared to wait several days for another. Just as they may want to go and buy some products in a shop, and others online, they may also select click & collect for one purchase, and home delivery for another.

The question is, therefore, not whether logistics should slow down and become slower logistics (there is no evidence to suggest that this has any great environmental benefit), but how it can adapt and organise itself to meet the multiple expectations of individual consumers in a way that does not sacrifice the environment for the sake of customer service – a new variable added to the already complex equation of omnichannel commerce.

As the pursuit of ultra-personal logistics hots up, it is necessary to be able to orchestrate both ultra-fast and slower flows, depending on customer demands. However, every effort must be made to make these flows more efficient and as environmentally friendly as possible because no brand in 2022 can afford to manage its logistics without a strong environmental concern.

Making environmental gains for retailers can be challenging, but help is at hand. With agile, flexible and responsive unified supply chain systems, all stages and processes that underpin consumer buying journeys (allocation and orchestration of stock, preparation of orders in the warehouse, in the shop, cross-docking, grouping or splitting of the same order, management of returns, management of restocking or smarter route planning) can constantly adapt upstream or last-mile transport plans to make not only the right decision on the speed of delivery, but also the most sustainable choices too.

SOLUTIONS BUILT FOR CUSTOMERS AND THE PLANET

When it comes to the challenge of omnichannel retail in 2022, a ‘reverse engineering’ approach is the best way to meet the test: start at the end of the journey with the customer expectation and work back through the processes to the software and IT architecture that underpins it all.

In reengineering supply chains in this way, when rapid consumer shifts occur, your supply chain network, systems and people will have strong and flexible enough IT foundations in place to allow them to speed up, slow down and realign with minimal impact to any point in the supply chain. Do this, and you’ll have a winning combination of speed (fast and slow), agility, control, satisfied customers and a happy planet too.