The Last 10 Steps in E-commerce

As Omicron spreads across Australia in a different kind of January wildfire, the growth of e-commerce is accelerating. Many households, mine included, have entered a quasi self-imposed lockdown. While we might be trying to avoid the inevitable of contracting COVID we’d prefer not to enter a lockdown during January and contract it before our kids (both under 12) receive their vaccines.

As far as spending is concerned, it’s a constant stream of video-on-demand packages at the door, click & collect groceries and takeaway instead of restaurant patronage. Maybe we’re being ridiculous, but in our house, we don’t even sign for packages and ask the delivery person to leave them at the door. We are just hoping our house doesn’t become a target for one of America’s favourite petty crimes – a hotspot for people following delivery trucks to steal packages. It’s so common that its participants are called Porch Pirates.

The Last 10 Steps

Despite recent COVID-related supply chain hiccups, the last mile in e-commerce is actually pretty good. We get email updates, text alerts, choices on delivery times, live geo tracking and you can even pay a premium for fast delivery.

But the fact that an internet video meme has risen from deliveries gone wrong gives us a clue to where the real technology opportunity exists. It isn’t the last mile, it’s the last 10 steps.

The first inkling of brands having a crack getting more out of the last 10 steps is thinly veiled data hoovers known as smart doorbells or security cameras mostly sold by Big Tech. Amazon has its Ring and Google has the Nest. While they do provide security to the homeowner via live and recorded video of what happens around the house, the real winners are the companies selling them.

Just think about what can be learned about the consumption patterns of any household from a sub $100 camera married with some image recognition A.I. This tiny, cheap camera can tell the likes of Amazon and Google how many people live in the home (even those without phones), their age, how often the leave the house, what they wear, the car they drive, what groceries they buy and from whom, how often they have visitors and entertain, which firms they get deliveries from and when. I’m sure you can think of another dozen insights to be gained from this low-cost spycam. In fact, they can know anything a black CIA van might’ve discovered staking out a home in a bad 1980’s cop show. Except, this time, their customers paid for the privilege and handed over the data free. And while it is somewhat of a concern that the world’s largest technology concerns have managed to convince us we need doorstep security surveillance, the capitalist inside me says this market will be the start of some serious innovation around the Last 10 Steps.

The Smart Mail-Box

We have smart phones, smart cars, smart cities, and even smart doorbells, I’m wondering why the Smart Mailbox is yet to arrive. This humble 250-year-old technology (the mailbox), is probably what Australia Post should’ve been working on this past decade. (I actually proposed it to them, but they told me they were too busy).

Just imagine a modern delivery receptacle which can take all manner of deliveries into a home, 24 hours a day. It could be a fulcrum device for the Smart Home of the future – and potentially a multi-billion dollar business. This reinvention should become a bellwether device which redefines the last 10 steps. Yet to this day no single firm in logistics, e-commerce, technology or data-oriented industries have bothered with a modern solution to the final delivery moment. Pick-up lockers have been a poor piecemeal solution which creates more problems and delivery steps. Solving this issue would do a lot to reduce the costs of non-delivery and create an entirely new market for investors.

So, here’s what my design would include: free for any enterprising Eureka readers to kick off a startup in 2022 for potential acquisition by some big tech giant!

Smart Mail-Box - Proposed Features:

• Space: It would require spaces which are dry, refrigerated and frozen. Fridge / freezer would only be activated to cool when items are inside.
• Size: Ideal size would probably allow holding of 2-3 package deliveries and a standard grocery delivery. At least half the size of large family fridge.
• Location: Front of home – fence line if possible – potential to be stored underground and raised up as required. (Just like a Thunder Birds cave)
• Connectivity: Optimal to connect to 5G network or broadband rather than home-wifi.
• Cameras: Both inward and outward facing. Outward facing to allow for delivery approval and interactions – Owner gets live video feed of who is requesting opening up for delivery. Inward for live feed for visual of goods inside / delivered.
• Microphone & Speaker: Allows for live verbal interaction for deliveries.
• Image Recognition: Potential to use as data point to see which firm is delivering the goods.
• Sensors Readers: RFID / other NFC chip readers / scanners to assess what has been delivered – check bar and QR codes - and by which firm. Weight sensors. 
• Computational capability: Ability to store all interactions with delivery, frequencies, times, items and other relevant data. Data to be stored directly to cloud.
• Electric operated: Potential for solar powering or simply connect to mains.

The delivery process would be need to be simple for a first time user too. “Press red button”. But the over-riding process would be to have an interaction which is similar to a facetime phone call. The owner of the item would see a call from the Smart Mailbox and answer to see live video of who is at the other end and then open the device for delivery. To avoid phone calls simple verification codes could be sent via text which automatically open doors and give access.

There are many potential revenue streams for a device like this; the sale of the unit (the smart play would be to start at a premium price and make it aspirational). The data it could provide would have incredible commercial value. The unit itself could even be installed via a subscription and create Monthly Recurring Revenues for the installer.

If I was the CTO of Coles, Woolworths, Toll or anyone big in the e-commerce supply chain, this would be my number one project. Succeeding here in Australia would not only enhance loyalty for any business, it could be licensed, or spun off globally.

Reconfigured Click & Collect

I’m not done yet. The second thing Australian retailers need to start thinking of is reconfiguring their car parks. Let’s call it the last 10 steps at the shopping centre. There’s a real clue in the growth of drive-through coffee. My local Coles has 3 car park bays for those picking up their click & collect order – and it’s always a disaster of car jams waiting to get a spot.

Click & Collect is an incredibly convenient option for shoppers, often faster than what an online delivery would be. And it is time for major retailers to recognize the opportunity. If they want to compete with Amazon (if they finally ever get serious about Australia) then they need to remember that they already have 1000’s of strategically placed micro-warehouses especially in grocery. They’re called “supermarkets”.

Investing in reconfiguring a smart delivery system of cars moving through a car park and getting goods put directly into their boot could be game changing for click & collect and reduce operating expenses. It’s also something big shopping centre operators like Vicinity Centers could focus on.

All of this is wide open.

While it might seem strange that I’m writing what looks like a business plan for logistics startups, it’s this type of thinking which leads us to successful technology-related investments. We need a mindset for markets poised for growth, married with innovative solutions which facilitate it. Just imagining what can and should happen allows us to see investment opportunities when they arise. What seems like common sense in hindsight, is for those who have the foresight.