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E-commerce fueling new delivery options

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NEW YORK — As many retail executives have predicted, the massively accelerated consumer shift to e-commerce triggered by the COVID-19 pandemic shows no signs of reversing itself. On the contrary, the convenience of home delivery and curbside pickup is fueling shoppers’ desire for ever-faster fulfillment, and major retailers across trade classes are responding with enhanced delivery options.

A recent Omnibus Survey by NielsenIQ reveals that more and more shoppers want the fastest delivery possible. According to the national study, 61% of respondents said they would prefer to have their online purchases delivered as quickly as possible, while 39% preferred to have their deliveries consolidated into one to reduce packaging and the number of trips.

In addition, a comparison of survey results from September 2019 and September 2020 found that the percentage of shoppers who preferred 2+ day delivery fell from 51% to 40%. Over the 12-month span between polls, same-day delivery, same-day pickup and next day/later pickup all gained favor among respondents, while 2+ day delivery declined.

It is no surprise, then, that retailers are raising the stakes in the omnichannel competition by introducing new fulfillment options and testing new technologies. Target Corp., for example, is piloting a new delivery concept that involves the sortation center it opened last year to serve stores in the Minneapolis-St. Paul market.

Under the system, store employees pick orders as they come in and pack them for delivery by truck to the sortation center, where orders are sorted using technology from two tech firms acquired by Target last year: Deliv and Grand Junction. The order is then delivered by contract workers of another Target subsidiary, Shipt.

Meanwhile, Kroger Co. is piloting grocery delivery by drones in Centerville, Ohio. The test is being conducted with licensed pilots of Drone Express, and customer deliveries are scheduled to start later this spring, while a second pilot is set for launch this summer at a Ralphs supermarket in California.

Last month Amazon expanded its Key by Amazon In-Garage Grocery Delivery service to more than 5,000 U.S. cities and towns after launching the initiative in five cities last November. As a result, Amazon Prime members in every market where the retailer’s regular grocery delivery service is available will be able to have groceries delivered to their garage.

In the chain drug sector, all three of the leading chains have upped their omnichannel game recently. Earlier this month, Walgreens introduced Same Day Delivery of more than 24,000 front-end products available online, promising delivery in less than two hours, with no minimum order requirement. Product offerings, delivery hours and fees vary by location.

CVS Health, meanwhile, has upgraded its CarePass customer benefits program to offer free same-day delivery of prescriptions and front-end products by Target-owned Shipt. Nonmembers of CarePass can get the same-day script delivery service for a fee of $7.99.

Finally, Rite Aid Corp. is partnering with DoorDash to provide delivery in less than an hour on average from more than 2,100 Rite Aid stores in 17 states. Customers can order nonprescription items from either the DoorDash app or website. Rite Aid already provided same-day delivery of health products and groceries in collaboration with Instacart.