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MEETING THE CHALLENGES OF URBANIZATION

The difference between winning and losing at e-commerce

“Strategic partnerships are now a crucial component of e-commerce success.”

Many of today’s businesses operate in a world shaped by two converging megatrends that are rapidly accelerating: e-commerce and urbanization.

These trends are creating both complex challenges and significant opportunities for organizations worldwide, as the gap widens between current logistics capability and the burgeoning expectations of online purchasers.

To explore the impact of urbanization upon e-commerce and the challenges this brings for businesses, we interviewed senior e-commerce and supply chain executives from major multinational retailers and consumer manufacturers.

One expert, Jeremy Baker, Affiliate Professor of ESCP Europe, The Times’ UK Business School of the year, summed up how the role of logistics has changed:

“E-commerce has made logistics more critical than ever before and as a consequence, has moved it up the hierarchy of managerial importance. It is no longer only a supply chain concern, but a crucial component of the overall customer experience. Mastering e-commerce logistics is now a priority for marketing teams, strategy professionals and even CEOs in consumer-facing industries.

E-commerce has also made logistics more challenging than ever before. Retailers need new skill sets to balance tradeoffs. Technology offers part of the solution, but it also means realigning the broader business model. Bricks-and mortar stores need to be reimagined for the digital age, taking on new roles as urban distribution hubs. It is not the end of the high street, but the beginning of a new role. Consumer-facing companies cannot do it all alone; they need to leverage partners. Strategic partnerships are now a crucial component of e-commerce success. We have found these trends are amplifying rather than slowing down. For the foreseeable future, e-commerce logistics will play a crucial role in determining global winners and losers.”

In this paper, we explore these trends and why, for all stakeholders in e-commerce logistics, winning means putting a focus on four areas in particular:

  • Make logistics a priority for the business
  • Reimagine bricks-and-mortar
  • Use Artificial Intelligence to manage the growing complexity
  • Build logistics partnerships to supplement internal capability

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