2020 Delivery Trends Inform 2021 Predictions For Your Business

2020 was unusual. However, like any year, it does help inform the one that follows. At Onfleet, we have witnessed this story through told data trends produced in our last-mile delivery software business. 

We saw the delivery of flowers and gifts decrease but then escalate as the pandemic went on past the summer. We noticed that desserts and novelties were most popular in the middle of the year. We noted that cannabis delivery increased early in the pandemic but stayed mostly flat after that. We witnessed B2B food delivery take a big drop, and it hasn’t recovered. Meanwhile, we watched grocery delivery increase early and continue to grow throughout the year — though not as much as restaurant delivery.

With 2021 upon us, it’s a good time to reflect. From Onfleet’s position partnering with leading retailers, big and small, here’s what I expect in the coming year: 

1. Consumers’ Covid-era behavior changes are permanent.

It’s now clear that Covid-19 — the defining factor of 2020 — will follow the economy into next year. Consumer habits are sticky, so even after the vaccine, the pandemic’s influence on buying behavior will largely remain. 

While customers are craving a return to normalcy, the coronavirus accelerated an already-rising digital economy. These changes are marketwide and not merely temporary. Next year, expect more demand for delivery and witness the shift into ushering permanent “here to stay” behavior trends. 

2. Customers will expect more from the delivery experience.

Fans don’t go to concerts merely for live music; they pay for presentation, atmosphere and experience. As delivery continues to accelerate, expect leaders in every industry to find ways to satisfy their customers with a high-quality delivery experience. 

Just as leading musicians or chefs are thinking about how to deliver a premium encounter, successful retailers in every area will find innovative ways to deliver a unique experience. 

3. Main Street will revitalize.

Historically, delivery was the domain of big players. Times have changed, with customers now realizing that e-commerce juggernauts like Amazon don’t do everything well. As more small and medium-sized businesses take on their own delivery solutions, expect a customer shift toward local favorites, old and new. 

Consumers already appreciate the uniqueness, personal connection and specialization of a boutique over a global chain. As they’re increasingly able to purchase delivery from these options, expect to see a rise in customized products, personalized offerings and artisanal brands. These offerings aren’t merely limited to monogrammed handbags or hand-tailored dresses; even large home goods or appliances will see this shift. Next year, expect specialty retailers to make their mark.

4. Delivery volume will soar.

In 2020, e-commerce delivery volumes boomed. Customers wanted to stay safe during the pandemic while still eating, drinking and replicating their favorite social activities. The way consumers interact with food businesses is a perfect example of how these habits are here to stay, with delivery revenue surging 103% during the pandemic.

In 2021, customers will order more delivery than ever before. Now that customers are comfortable with delivery, expect them to increase their frequency across industries. Once someone’s already ordering food twice a week, it’s only a small psychological shift to start ordering three times, and once customers are familiar with ordering delivery in general, expect them to start ordering in new areas, too. 

In food delivery, this will lead to businesses optimized for delivery, like ghost kitchens or nontraditional preparation spaces. In other areas, too, retailers will adjust, leaning toward low-rent options such as micro-fulfillment centers that emphasize deliverability over the storefront.

5. The demand for smart delivery automation will accelerate.

In delivery, like in many areas, economic conditions favor automation. As the demand for delivery accelerates, the value of delivery automation increases, too. 

In 2021, expect to see small movements toward delivery automation, such as increased funding for drones and autonomous vehicle companies. That said, these shifts are likely to be small. The opportunities are exciting, but the challenges are large. Government regulation, for instance, is only nascent, and car insurance companies are still deciding how to cover self-driving cars. 

Delivery is still in the early stages of this paradigm shift. Amazon, for instance, recently laid off a large portion of its Prime Air drone delivery team, implying less enthusiasm for investing in this area for the time being. On the other hand, autonomous delivery companies Gatik and Nuro recently raised $25 million and $500 million, respectively, the sort of money that will accelerate industry innovation in the coming years. 

Next year, be on the lookout for interesting developments in autonomous vehicles — like more Waymo rides and promising delivery news from Tesla — but we’ll have to wait a bit longer before automation takes delivery by storm. 

6. Innovative delivery methods will rise.

Subscriptions tend to instill loyalty in customers, increasing the likelihood they purchase again. These models both increase efficiency and create reliable revenue. Because a small percentage of customers typically drive a large percentage of sales, the successful businesses in 2021 will create new business models that increasingly revolve around delivery subscriptions.

Successful retailers will realize that delivery isn’t merely a choice between on-demand, subscription or scheduled; instead, your optimal offering depends on your customer and product. If you find the combination that works for you, you’ll create happy and profitable customer habits. 

How To Plan For 2021 

To make the most of these 2021 trends for your business, make sure you: 

• Create a unique, high-quality delivery experience. Successful companies will be the ones that both surprise and serve their customers and double down on their unique brand. 

• Turn delivery into a customer habit. Delivery subscriptions and loyalty rewards can make a customer’s repeat business easier, more satisfying and more reliable. 

• Are efficient in your delivery. If you’re a retailer, you’ll be delivering much more next year. Find ways to optimize your routes and shipping.