🎉 We’ve just dropped our first-ever holiday gift guide, filled with amazing gifts and party items Ohi can have delivered in as little as two hours — right up until December 24th!
Feast your eyes on The Instant Gift Guide 🎄and have a holly, jolly holiday! ❄️
Check it out here: 👇
ohi.com/gift-guide
Gone are the days when two-day delivery was exciting. Customer expectations and shopping behaviors around delivery speed have shifted. People want everything delivered ASAP, a preference that has been accelerated by the COVID-19 pandemic and the disruptions that presented.
As a result, many more e-commerce businesses are building ‘speed’ into their DNA, cutting down on the wait time window by expanding into same-day and two-hour or less delivery coverage.
The playing field is jam-packed with marketplaces racing to deliver orders at an unbelievably fast speed, begging the question, just how much does delivery speed really matter? Here’s a round-up of various studies offering insights on the question.
People ordered stuff online before the pandemic, but not near the rates we see today. So, what gives? The demand for instant delivery of groceries, food, and other convenience products increased when the coronavirus forced Americans to stay at home. Contactless delivery was a necessary evil that consumers have increasingly come to appreciate, even as the pandemic wanes. More people began shopping online with greater frequency in 2020 and 2021, accelerating the ongoing shift to e-commerce by more than five years, according to IBM’s US Retail Index.
Regardless, these events unfolded a new chapter in e-commerce, giving rise to instant commerce, also called quick commerce, kickstarting the delivery speed trend.
Amazon has always been ahead of the delivery speed curve and is known for having the fastest and most convenient delivery options. This e-commerce giant has subtly shifted consumer perceptions of delivery speed from a “nice-to-have” to a “must-have,” and continually pushes the envelope with faster and faster offerings such as its Prime two-hour delivery.
Prime first debuted in 2005, providing two-day delivery as part of its subscription-based membership. Then in 2009, when e-commerce was still in its infancy, Amazon became one of the only major retailers to introduce same-day delivery. Same-day delivery was initially offered across just seven cities and cost Prime members $6 and non-Prime members $15. And within the next five years, customers began embracing same-day delivery, ordering 10x the number of products using same-day delivery.
Amazon’s logistics clout has disrupted a decades-old market dominated by FedEx and United Parcel Service (UPS). Businesses like Amazon and Walmart have followed suit, throwing hundreds of millions of dollars into making same-day or two-hour delivery possible for their customers.
Interestingly, a survey found that 96% of respondents equated “fast delivery” with same-day delivery, 61% wanted their orders to arrive within 3 hours after checkout, and 25% declared that they would outright abandon their carts if same-day delivery wasn’t an option.
Meanwhile, Instacart recently reported that 85% of shoppers in a survey by The Harris Poll said they prefer to receive grocery orders in two hours or less.
Time is money to many shoppers, particularly to hyper-busy segments such as parents or young professionals. This demographic is typically more willing to pay a premium for convenience. Here’s a rundown of several studies that shows the significance of delivery speed to these online shoppers.
Call it the “Amazon Effect,” perhaps, but consumers now expect options for two-day, same-day, and even sub-two-hour delivery options at the checkout, and they are willing to pay for it.
The recent study “Sooner or Later? Promising Delivery Speed in Online Retail” suggests that optimizing delivery speed promises can significantly impact a company’s sales. The research showed that when the retailer promised customers one day faster shipping, sales increased, profits increased, and customers spent more per order. The one-day faster promise increased sales by 0.73%, profits by 2.0%, and value per order by 3.5%.
Similarly, the research also illustrated that a slower delivery speed promise negatively affected the variables. For example, the data shows that a one-day slower delivery speed could result in a decrease in sales by 0.51%, profits by 2.7%, and value per order by 3.1%.
ROI data from Ohi, an instant commerce provider for DTC brands, shows a strong payoff for businesses that invest in delivery speed.
Ohi analyzed some of its large partner brands that use Ohi’s 2-hour and same-day delivery and found that orders with same-day delivery had 30% higher repeat purchase rates than standard UPS/FedEx. But interestingly, repeat purchase rates associated with Ohi’s 2-hour delivery were even higher: up to 24% higher than same-day delivery and 61% higher than standard UPS/FedEx.
Outcomes observed were similar for customer lifetime value (CLV). Customers who initially ordered with Ohi same-day had 23% higher CLV than orders fulfilled through UPS/FedEx. CLV for Ohi 2-hour delivery was up to 16% higher than same-day delivery and 43% higher than standard UPS/FedEx.
So is delivery speed essential to a great overall shopping experience? If your e-commerce business does not cut down on the gap between the checkout and the customer’s doorstep, your customers will seek an alternative brand or marketplace that satisfies their need for speed. Besides, building delivery speed into your e-commerce strategy can put your brand on the path to a frictionless buying journey for your customers, which will help increase your online conversion rates and improve customer loyalty.
At Ohi, we’ve flipped the script for e-commerce fulfillment, transforming it from what is traditionally seen as a cost center into a growth engine. Brands join the Ohi platform to deliver powerfully fast, brand-focused, and memorable post-purchase experiences that enable them to grow. Want to learn more about how Ohi enables instant commerce? Get in touch today.
We’re happy to announce that two-hour, same-day, and next-day delivery is now live in Philadelphia.
Get your products in the hands of Philadelphians faster than they can say “Whiz wit” for their cheesesteaks.
If you have any questions or would like more information, please reach out to your account manager or contact us here.
Given the ongoing trend towards instant commerce, micro-fulfillment continues to be a hot topic in the e-commerce space. We sat down with Ohi’s Michael Witalec (VP of Ops) and Greg Szczepanski (Head of Special Projects, Ex-GoPuff) for a Q&A on micro-fulfillment and how Ohi approaches it.
Greg: Ohi is leading the next generation of instant commerce. Our unique distribution model enables brands to meet their customers’ expectations of rapid delivery on their own direct-to-consumer (DTC) websites. By offering a DTC-focused solution that helps brands with many aspects of their post-purchase experiences (centered on a curated instant delivery experience), we stand apart from other fast grocers and other quick/instant commerce models out there by giving control over the customer experience (and data) back to the brands themselves.
Michael: Micro-fulfillment is the miniaturization of traditional fulfillment, from both a space and time perspective. We’re in dense urban areas to intentionally shorten the distance to the doorstep, requiring a much smaller footprint. We’re tendering orders in much smaller batches and often interacting with the same person who will interact with the customer, which enhances the end customer experience.
Greg: While micro-fulfillment works best with non-bulky items and lower SKU counts, as you might expect with inventory being distributed throughout the country in small non-traditional warehouses, Ohi prides itself on flexibility. We’re eager to explore innovative solutions with any DTC-focused brand.
Michael: Final delivery is critical to success because that’s where the direct interaction with the customer is strongest (and most tangible). We’ve built many strong delivery partnerships that enable us to optimize the final delivery experience for every order. Combine that with our LiveOps team and continuous system monitoring, and you get a big piece of our signature instant delivery experience.
Greg: Great question. From a financial aspect, evolving a DTC-focused business delivery system has traditionally been critically important to reach or maintain profitability. Businesses invest deeply in their supply chains to reduce the cost of fulfillment and TnT, and this mentality is pervasive among operations teams. With Ohi, while we are favorable in the cost department for many situations (e.g. because inventory is forward-positioned), we find that the instant delivery experience presents unique ROI beyond cost reduction – in terms of the customer experience, which leads to improved repeat purchase rates, customer lifetime value, and other growth-focused ROI.
Additionally, by leveling up their DTC performance with Ohi, brands enjoy greater margins and control over more of their overall business, while avoiding some of the negatives associated with their B2B2C channels, including chargebacks.
Michael: Very carefully. Space is only a constraint over a fixed period of time, so with Ohi’s AI-based predictive demand forecasting models and regular input from our brands, we’re able to achieve high in-stock performance with our MFC network. With our hubs, which we’ll talk about more, we’re also able to control the distribution to MFCs in real-time, based on inventory levels.
Michael: We learned early on that simplicity was critical to our clients, as they want to focus on growth opportunities and not day-to-day logistics. We borrowed from tried and true methods to launch hubs, which dramatically reduce injection points and aggregate demand for the client. From there, our team handles the more complicated aspects of allocation across the MFC network for our clients.
Greg: Ohi’s hubs help to facilitate replenishment of inventory to MFCs while simplifying the inbounding process for our clients via fewer injection points. Because they’re actual distribution centers and are much larger than MFCs, hubs maximize efficiency when it comes to the intake, processing, storage, and distribution of goods (to MFCs) for our clients. This means less money wasted paying for temporary storage, dealing with stockouts, or losing customers due to delayed or incomplete orders.
Greg: Consumers nowadays want same-day deliveries. Many companies are trying, often unsuccessfully, to meet the demands of today’s customers with outdated fulfillment networks.
Ohi MFCs utilize small and automated storage close to the end customer to achieve cost savings and accelerate delivery times. There are three key components that allow Ohi to perform this process successfully: 1) a robust enterprise and logistics management system to manage the warehousing, inventory, and order management; 2) forward logistics facilities that minimize travel distance/time/cost; and 3) easy technical integration with clients’ e-commerce platform.
Michael: We’ve been in a dynamic environment since our launch a couple of years ago, with real estate, labor, and now fuel markets becoming volatile. Our model utilizes economies of scale with larger movements of inventory to a forward location (the MFC), reducing fuel on a per-order basis. Combined with our growing use of electric-powered and eco-friendly transportation, we’re reducing our carbon footprint while reducing dependence on traditional energy sources.
Greg: With Ohi forward positioning our clients’ products in small MFCs around the country, we have substantially reduced the amount of transportation and delivery required on a per-order basis, despite the increase in the number of dedicated deliveries. Importantly, our close proximity to end customers allows us to use eco-friendly transportation (walkers, bicycle messengers, and electric vehicles) and reduce the need for wasteful cardboard packaging. For our residual carbon footprint after those measures, we’re able to use carbon offsetting (through our partner, EcoCart) to provide carbon-neutral order fulfillment.
At Ohi, we’ve flipped the script for e-commerce fulfillment, transforming it from what is traditionally seen as a cost center into a growth engine. Brands join the Ohi platform to deliver powerfully fast, brand-focused, and memorable post-purchase experiences that enable them to grow. Want to learn more about how Ohi enables instant commerce? Get in touch today.
News flash: the slow and steady tortoise no longer wins the race.
The modern shopper’s need for fast delivery has intensified, thanks in large part to the expectations that industry bellwethers like Amazon, Walmart, and Target have helped shape in the past couple of years.
Direct-to-consumer brands and smaller retailers literally have zero chance of protecting (much less growing) their market share without similarly adopting the ways of the speedy hare.
Fortunately, the emergence of instant commerce and micro-fulfillment players like Ohi empowers them to close the gap and even out-compete many leading marketplaces when it comes to e-commerce fulfillment.
Instant delivery is way more than just a ‘nice-to-have’. It’s a must-have upgrade, and it’s very much mandatory if you want to meet your customers’ expectations.
A 2021 global consumer insights survey by PWC revealed “fast/reliable delivery” as consumers’ #1 overall consideration when shopping online.
And businesses who don’t upgrade to at least Amazon-like delivery speed will eventually lose out to Amazon or other big retail companies that are solving for instant commerce.
Happy customers help you grow your brand’s bottom line. According to proprietary Ohi research, the D2C brands that are leveraging instant 2-hour delivery had 24% higher repeat purchase rates compared to same-day delivery and an astounding 61% higher repeat purchase rates when compared to standard UPS/FedEx.
Instant delivery is game-changing for D2C-focused brands, and here are a few success stories that illustrate that very point.
Olipop is a leading fizzy tonic brand, the maker of a new kind of soda made from all-natural ingredients, combining the benefits of prebiotics, plant fiber, and botanicals.
Although the brand has a solid omnichannel presence, they believe a direct-to-consumer strategy is crucial to growth.
And for that purpose, the brand needed a D2C/DTC fulfillment partner to meet its high customer experience expectations.
Thanks to the flexible and fast delivery of its sparkling tonics on Ohi’s platform, Olipop now provides its customers with a tremendous post-purchase experience that matches its excellent pre-purchase experience. As a result, many of their customers have repeat subscription orders; with Ohi, Olipop customers can schedule and reschedule deliveries within seven days and in three different time windows.
For Ohi-shipped orders, Olipop experienced a 150% higher customer lifetime value (CLV) and a 140 percent increase in lifetime orders (versus non-Ohi).
The significant increase in repeat purchases highlights the significance of “fast, free, and flexible” delivery for customers and explains why Olipop customers rate Ohi 4.6/5 stars for exceptional service.
For centuries, women have endured painful periods (dysmenorrhea), pains associated with endometriosis. Ovira is a DTC-focused company devoted to helping women end this pain. Ovira’s revolutionary device, Noha, minimizes pain using pulse therapy.
Because period pain can be spontaneous and unbearable, Ovira wanted a fast delivery of the Noha device.
Ohi seemed like the perfect instant fulfillment partner Ovira sought to meet its customers’ need for convenient and fast delivery.
With instant delivery as part of its post-purchase customer experience, Ovira’s repeat purchase rate has more than doubled (+120% for Ohi-shipped orders in comparison to orders shipped via FedEx/UPS). In addition, Ovira’s customers who ordered with Ohi rated us an average rating of 4.7/5 stars.
These numbers clearly emphasize what it means for Ovira’s customers to have instant pain relief products.
To minimize fulfillment costs while providing a great customer experience, one of the country’s most popular kombucha brands sought a better alternative to conventional 3PLs in its major metro areas.
Health-Ade, established in 2012, has quickly developed a nationwide customer base that adores its kombuchas for their delicious taste, an exciting variety of flavors, and countless health benefits.
Kombucha has special handling/transport requirements because it must be refrigerated to maintain peak freshness and probiotic qualities.
Traditional e-commerce fulfillment wasn’t a good fit for Health-Ade: they realized that delivering glass bottles over long distances via UPS/FedEx using a traditional 3PL wouldn’t be viable. First, there’s the risk of breakage. And then there are the ridiculously high costs associated with shipping weight and extra-packaging materials and the need to keep the kombuchas cold, typically necessitating the use of expensive cold packs.
Health-Ade required more efficient handling of e-commerce fulfillment in its most critical metro areas.
Ohi enabled instant commerce for Health-Ade allowing them to deliver Kombuchas instantly to their customer base within a week of deployment.
After partnering with Ohi, Health-Ade has seen its customer lifetime value (CLV) increase by 49% on orders shipped with Ohi (versus standard FedEx/UPS), showing just how valuable the instant commerce experience is to customers.
Health-Ade’s customers have rated Ohi an average of 4.6/5 stars for service excellence.
Athletic Brewing, a non-alcoholic craft beer brand, was looking for a faster and more reliable fulfillment partner and had been unimpressed with traditional 3PLs’ fulfillment capabilities and overall lack of D2C-friendliness.
As impressive as Athletic Brewing’s products are – beers brewed from high-quality, all-natural ingredients for “the modern-day beer drinker”- they needed an instant commerce solution to kick their customer experience up a notch and drive meaningful D2C growth.
After learning how Ohi could elevate their customer experience and drive significant ROI while keeping its powerful brand front-and-center, the brand turned to Ohi’s instant delivery solution.
Athletic Brewing now enjoys a 30% uptick in repeat purchase rates on Ohi-shipped orders compared to orders delivered through FedEx/UPS. Additionally, athletic Brewing customers rated Ohi an average of 4.7/5 stars.
With Ohi’s shipping options – 2-hour, same-day, and next-day delivery – the DTC-focused brand delivers great-tasting beers to its customers alongside a custom-branded post-purchase experience.
Customers receive real-time tracking information via email/SMS (tailored to Athletic Brewing’s brand guidelines), allowing them to track their orders to their doors.
So how does Ohi do it?
We keep our inventory “hyperlocal” in micro-fulfillment centers in major metropolitan areas. This enables our partner brands to deliver their products to customers within the same day or two hours – in time for a spontaneous dinner, a late or early morning drink, or to relieve period pain.
We’re proactive – our dedicated teams analyze your brand’s product demand at the SKU level, consistently working with the operations team to ensure there’s sufficient inventory available across the micro-fulfillment networks. In addition, Ohi’s account managers work with brands to ensure seamless procedures while identifying ways to boost efficiency and ROI for our partner brands.
Our technology constantly monitors delivery speed and consistency within the Ohi network, modifying courier utilization and other factors to ensure customers get what they ordered within the chosen delivery window.
And because we keep our inventory as close to customers as possible, our packaging and last-mile shipping are also more environmentally friendly.
Many of the world’s top marketplaces and big retailers are already looking beyond same-day delivery and upping the ante once again with sub-hour delivery options.
And with 15-minute delivery becoming a thing in New York City and elsewhere, your D2C brand crossing the finish line in 3-5 business days just won’t suffice any longer. The race will have been long over before your brand reaches the line.
About Ohi
At Ohi, we’ve flipped the script for e-commerce fulfillment, transforming it from what is traditionally seen as a cost center into a growth engine. Brands join the Ohi platform to deliver powerfully fast, brand-focused, and memorable post-purchase experiences that enable them to grow. Want to learn more about how Ohi enables instant commerce? Get in touch today.
One rusted cog can derail your entire supply chain, impacting operational efficiency, resulting in decreased margins, lost revenue, slow supply chain velocity – and above all, decreased customer satisfaction. By optimizing your e-commerce supply chain, you can overcome these buffers, and return to maximum operational efficiency.
Before we get to optimization best practices to deal with supply chain kinks, here’s a brief overview of supply chain optimization.
Supply chain optimization is the process of fine-tuning your supply chain to remove any trouble spots so that it performs efficiently.
Although your supply chain might seem like an unsung hero that works behind the scenes, the success of your entire online business literally hinges on your supply chain.
Any disruptions in the supply chain i.e lack of visibility in micro-fulfillment operations, ineffective order processing, delayed or wrong orders, all impact the customers. And customers don’t want the constant worry of receiving the wrong or damaged products or delayed delivery.
Ever wonder what Amazon’s secret to success is?
The e-commerce leader owes its success to its advanced supply chain model. What began in Jeff Bezos’s garage give-or-take 25 years ago, with solely books as products, is today recognized as the largest and most efficient supply chain operation in the world.
With fast and free shipping as a key driver for online and cross-channel purchases for the fifth year in a row, the biggest opportunity for brands and retailers lies in creating more efficiencies in the supply chain. (Walker Sands, award-winning marketing agency)
This is to say, a well-organized and efficient supply chain can expedite nearly all major e-commerce micro-fulfillment operations and distribution processes, ensuring that customers’ expectations are fulfilled. Let’s get straight to the optimization practices.
It’s true we’re living in the age of smart machines, however, automating the supply chain does not entail bringing on board the likes of HK-47 (the evil robots from the Star Wars franchise) or a very self-aware Ava (Ex Machina).
Automation will help you increase employee productivity, reduce human error and costs, and increase operational efficiency. A report by McKinsey says automation is capable of accelerating the productivity of the global economy by between 0.8% and 1.4% of global GDP annually.
Here are a few supply chain operations you can automate:
As an example, Ohi’s inventory and order management platform gives DTC e-commerce brands actionable insights into SKU-level demand, enabling brands to automate functions for efficiency and savings. Ohi merchant partners have seen increases of up to 120% in repeat purchases, along with 28% higher conversion and 35% increases in lifetime customer value.
During the pandemic supply chain disruptions, brands like Nike realized the importance of automating operations. Nike, for instance, made a few important changes in its supply and decided to use radio-frequency identification (RFID) technology to automatically identify and track its footwear as well as some of its apparel. What’s more, with greater visibility into its inventory levels throughout its supply chain, the brand was better able to meet demand across its many retail/distribution channels.
Delivery performance is how successful the supply chain is at delivering products and services to customers.
In a competitive marketplace increasingly driven by instant delivery, customer expectations for delivery speed/timeliness are extremely high. People want to have everything delivered fast, and they have little patience for missing or late shipments. They have plenty of options in terms of marketplaces and other brands, so one delayed delivery can cause them to cancel their order and move on to your competitor.
One dilemma for DTC/D2C brands is that many aren’t capable of delivering orders with Amazon Prime Now-type speed. Here at Ohi, we’ve cracked the formula and are helping our brand partners offer ultrafast delivery via our micro-fulfillment centers. Meanwhile, Ohi’s latest delivery scheduling feature makes it easy for customers to schedule, track and even reschedule when needed – home delivery when it is most convenient for them.
All Ohi brand partners, including leading beverage, CPG, and beauty players – Olipop, Alkaline88®, Health-Ade, and SolaWave – now have access to the delivery scheduling option to help boost their conversion rates and customer lifetime value.
Only 6% of companies report full visibility on their supply chain. 69% of companies do not have total visibility. (zippia)
Having access to the right data from an analytics standpoint can help you make educated decisions for supply chain planning. Inventory turnover rate, order accuracy, time to ship, storage capacity used, and the average cost per unit for storage, inbounds, fulfillment, and shipment are all critical metrics to track, as they provide insight into which areas of your supply chain are thriving and which require improvement.
In fact, analyzing the right kind of data that can provide supply chain visibility in real-time will also help foster better risk management.
Staying in the dark and avoiding numbers never helped anyone; without real-time information, you will frequently find yourself looking in the rearview mirror and unable to respond quickly to dynamic supply and demand conditions.
Your first step is to analyze your entire supply chain process and identify which areas can be improved. Some of these elements will be easy to identify; for instance, delivery vehicles that consume a lot of fuel or wasteful packaging materials.
If you aren’t already, make environmentally-friendly packaging and instant delivery a part of your supply chain. Besides saving the planet, sustainability is also becoming an increasingly important purchase factor for customers nowadays.
For instance, here at Ohi, our instant delivery generates the least carbon emissions because we ship products from micro-fulfillment centers that are located very close to customers. Because we use bike/e-bike/scooter couriers and foot couriers whenever possible in densely populated urban areas, instead of vans or cars, our transportation carbon footprint stays small.
In fact, Ohi deliveries were shown to be 22x more eco-friendly than next-day air and 5x more eco-friendly than 3-5 day ground.
As for packaging, for many of our rush and same-day deliveries, Ohi uses eco-friendly reusable totes, minimizing the use of cardboard/plastic waste in our packaging.
E-commerce top guns like Amazon and Walmart are not slowing down on innovation and growth – and the supply chain continues to be one of their most powerful levers to outcompete DTC/D2C stores and smaller retailers. Strengthening your supply chain is therefore all the more imperative if you want to stay relevant and grow your e-commerce brand in these times.
About Ohi
At Ohi, we’ve flipped the script for e-commerce fulfillment, transforming it from what is traditionally seen as a cost center into a growth engine. Brands join the Ohi platform to deliver powerfully fast, brand-focused, and memorable post-purchase experiences that enable them to grow. Want to learn more about how Ohi enables instant commerce? Get in touch today.