5 Ecommerce Logistics Trends You Should Adopt in 2023

Ecommerce has revolutionised the way we shop, and logistics is at the heart of this transformation. 

From warehouses and transportation to packaging and delivery. The entire supply chain has been reimagined to meet the demands of online shoppers. 

Ecommerce logistics is a fast-evolving field that requires constant innovation and adaptation. As a result, we can expect to see some major trends shaping the future of ecommerce logistics. 

The changing face of ecommerce logistics

Ecommerce has experienced unprecedented growth in recent years, with a significant spike during the covid pandemic, for obvious reasons.

Between 2010 and 2020, global eCommerce sales increased by nearly 800% and with new technologies making ecommerce more accessible than ever before, businesses must stay ahead of the curve to meet customer demands.

A crucial aspect of ecommerce success is efficient and scalable logistics. 

With the logistics industry constantly evolving, businesses are always seeking new ways to streamline their operations and reduce costs. 

In this article, we explore 5 logistics trends - automation, AI, sustainability, omnichannel logistics and last mile expectations - and their implications for etailers and logistics providers alike. 

Let's learn how these trends will shape the way we ship, deliver and manage online orders...

1. increased adoption of automation and robotics

One of the most significant trends in ecommerce logistics is the adoption of automation and robotics. From self-driving delivery trucks to robotic pick-and-pack systems, technology is revolutionising every aspect of the supply chain. 

By automating routine tasks and processes, businesses can reduce costs, increase efficiency, and enhance the overall customer experience. 

Automation and robotics in warehousing and fulfillment

As ecommerce continues to grow, many logistics providers are turning to automation to improve efficiency and reduce costs. We see this in particular in warehousing to streamline processes such as picking and packing.

Alternative video suggestion showing 6 examples of warehouse robotics: 

Robots can handle repetitive and physically demanding tasks that humans may find difficult or time-consuming. Plus they can also work around the clock, reducing the time it takes to fulfill orders.

For example, at the Shentong Express factory, "300 'Little Orange' robots work together to sort 20,000 parcels an hour." Considering humans can be expected to spend anywhere from 30 seconds to 3 minutes packing one order, robots operate at at least twice the speed, plus they're available 24/7.

Automation and robotics in last mile logistics

As technology continues to advance, autonomous delivery systems such as drones and self-driving vehicles are becoming increasingly viable options for ecommerce logistics. 

These systems offer faster, more efficient, and cost-effective options for logistics and transportation.  

According to Vikram Singh, CEO of TechEagle, which has conducted more than a thousand drone deliveries in rural parts of India, drones are "proving to transform logistics" stating that his company's drones can deliver parcels "20 times faster than ground-based transportation."

In 2023 and beyond, businesses that integrate autonomous delivery into their logistics processes will have a significant competitive advantage since they will be able to deliver more items faster, and cheaper - in the long run, the investment in drone technology will pay off in the savings made on ground transportation such as vehicle maintenance and rising fuel costs.

2. integration of AI and data analytics

Another trend that is gaining momentum in ecommerce logistics is artificial intelligence (AI).

For etailers, this is incredibly powerful in enhancing their offer to a consumer. Businesses are leveraging data analytics and AI to create personalized recommendations and promotions, offering customization options that allow customers to design and personalise their orders. From packaging and branding to product features and functionalities, personalization is becoming expected. 

In logistics, AI and data analytics are invaluable. It's one thing for etailers to offer a great product, but it's a whole new world when it comes to fulfilling their order and making sure it lands on their customers' doorstep right on time. Data is used along the entire journey, from order placement to delivery, ensuring fulfillment is accurate and efficient.

Data analytics touchpoints in ecommerce fulfillment 

First, data is used in inventory management e.g. to track incoming and outgoing goods to ensure that the correct items are in stock to fulfill orders. This may involve monitoring inventory levels in real-time and using predictive analytics to anticipate future demand in order to ensure that there is enough inventory to meet customer orders.

Next, data is used in the order processing stage to verify the accuracy of order details and confirm that the correct items have been selected for shipment. This may involve using automated systems for order validation, to match orders with available inventory, or to flag any discrepancies that need to be resolved before the order can be fulfilled.

Once the order has been processed, data is used to optimise the picking and packing process to ensure that items are selected and packaged accurately and efficiently. This may involve using artificial intelligence to identify the most efficient picking routes and packing strategies, using real-time data to track progress and adjust workflows as needed.

Finally, data is used to manage shipping and delivery, including selecting the most appropriate shipping method, tracking the progress of the shipment, and communicating delivery status to customers. This may involve using data analytics to improve shipping routes, manage carrier relationships, optimize the parcel distribution per carrier and predict delivery times based on historical data.

Data challenges in ecommerce fulfillment

Overall, data plays a critical role in every stage of the ecommerce fulfillment process, helping businesses to optimise their operations and provide better customer experiences, however, it does bring with it its own set of challenges.

Here are just some of those faced by the lack of data or inefficient data in the fulfillment process:

1. inventory visibility

Managing inventory across various distribution centers and retail stores can be a challenging task. In order to fulfill orders quickly and efficiently, it is crucial to have transparent and accessible data across:

• Product - SKUs and attributes like color, size and weight
• Inventory - real-time data about stock quantity, orders or back-orders 
• Sales - sales volume, order frequency and order history
• Suppliers - lead times, pricing and availability
• Shipping - tracking numbers, delivery times

Without this inventory visibility, businesses can experience the following:

• Stockouts: a company may experience stockouts due to the inability to track inventory levels accurately. This can result in lost sales and missed opportunities.
• Overstocking: a lack of inventory visibility can also lead to overstocking, which ties up capital and storage space and can result in financial losses.
• Inefficient operations: without accurate inventory data, companies may struggle to operate effectively, leading to inefficiencies in production and distribution.
• Delayed fulfillment: a lack of inventory visibility can cause delays in fulfilling orders, resulting in longer lead times and decreased customer satisfaction.
• Increased costs: inaccurate inventory data can result in increased costs, such as expedited shipping fees or additional storage expenses, which can ultimately impact a company's bottom line.

2. transit visibility

The absence of transparency during the last mile is a significant issue in the supply chain. Once a shipment departs from a warehouse, it is often challenging for the carrier to track its progress until it arrives at the post office or the customer's doorstep. 

This can result in delayed communications with customers who make enquiries about their upcoming deliveries or can lead to incorrect details being relayed to customers; both scenarios being detrimental to customer satisfaction and loyalty. Real-time data can allow for precise tracking which would eliminate these issues.

3. inefficient return logistics

Poor return logistics can be detrimental to an ecommerce business, potentially resulting in lost future orders. To prevent this, returns should be made simple and easily accessible, utilising data captured from the initial purchase to suggest convenient return delivery methods.

The importance of data analytics in fulfillment and distribution 

Logistics really is key to success in building strong relationships between ecommerce customers and the online store as customer satisfaction increases loyalty and engagement, leading to repeat custom.

To optimize logistics operations and improve customer experience, many companies are integrating artificial intelligence and data analytics to track shipments in real-time, optimize delivery routes and better forecast demand.

A 2020 study by Tata Consultancy and industry association Bitkom showed that 47% of companies see artificial intelligence as a key technology for logistics, whilst 27% are already using AI or have specific plans to use it.

Artificial intelligence is enabling businesses to optimize their logistics processes and improve efficiency, ultimately allowing them to make data-driven decisions and reduce costs.

3. focus on sustainability

Sustainability is no longer a buzzword but a necessity for businesses that want to thrive in the long run, it's becoming an increasingly important consideration for consumers. 

Research by Deloitte found that 64% of consumers consciously limited their consumption of single use plastics in 2022.

Ecommerce logistics is therefore no exception. 

Businesses must consider the environmental impact of their logistics processes, such as transportation and packaging, and look for ways to reduce their carbon footprint. 

In ecommerce logistics, sustainability and green logistics are becoming increasingly important as customers demand environmentally friendly practices and products. 

As a result, etailers and logistics providers alike are adopting a whole set of 'green behaviors' to attract and retain customers:

• Eco-friendly packaging materials
• Delivering with carriers using electric vehicles to reduce carbon footprint
• Optimising supply chain to minimise waste and emissions
• Partnering with suppliers and logistics providers that share their sustainability values and goals
• Integrating green technologies within the workplace
• Leveraging micro-fulfilment centers for localised shipping in order to reduce their carbon footprint
• Collaborating with carriers adopting novel ways to deliver goods such as by cargo-bicycle 

In 2023 and beyond, businesses that prioritise sustainability in their logistics processes will gain an advantage by appealing to environmentally-conscious consumers.

By embracing sustainability and green logistics, businesses can differentiate themselves from their competitors, reduce their costs, and contribute to a more sustainable future.

4. expansion of omnichannel logistics

Omnichannel and unified commerce are two related trends that are reshaping the ecommerce landscape. 

"Omnichannel distribution in shipping is where a customer can place a purchase order for a product and receive it from any source that he or she chooses from. In logistics, the main aim of omnichannel distribution is customer satisfaction through a single point of contact and a smooth flow of processes." - Marine Insight 

When we speak of various sources, customers often have a choice between home delivery, click-and-collect in store or click-and-collect from a nearby drop-off point such as a local corner shop or post office. Each source has its own logistics process so if an ecommerce store chooses to offer this flexibility, it's crucial they can cater to the varying needs.

Unified commerce, on the other hand, goes beyond omnichannel by integrating all aspects of the supply chain, from order management and inventory to shipping and delivery. Giving end-to-end visibility means the ability to track goods from the point of origin to the point of consumption. 

In ecommerce logistics, end-to-end visibility is crucial for ensuring timely and accurate delivery and managing inventory. 

5. emphasis on last-mile delivery

Finally, last-mile delivery optimization is a critical trend that will continue to shape ecommerce logistics in 2023 and beyond. 

Last-mile delivery refers to the final leg of the delivery process, from the distribution center to the customer's doorstep. 

This stage has become a critical component of ecommerce logistics, as it is often the most expensive, challenging and time-consuming part, requiring a high level of coordination, efficiency and accuracy. 

It's also arguably the most important part of the process for increasing customer retention. A great delivery experience encourages repeat customers; a not-so-great experience, such as delayed delivery or lost items will lose customers.

By leveraging technology and data analytics, businesses can optimise their last-mile delivery operations and provide customers with real-time tracking, notifications and delivery options.

To optimize the last mile even further, logistics providers are implementing solutions such as crowdsourcing and micro-fulfilment centers to ensure faster turnarounds as consumers increasingly expect fast, convenient shipping options - same-day delivery is becoming the norm rather than the exception. 

Research shows:

• 63% of customers say delivery speed is an important factor
• 77% will still pay for faster shipping
• 80% of consumers want same-day delivery
• 56% of under 35 year olds expect same-day delivery, with 61% willing to pay extra
• 96% interpret "fast delivery" as same-day delivery

In 2023 and beyond, businesses that can offer a seamless last mile experience (even better if it includes same-day delivery) will have a significant competitive advantage. 

However, it takes a super efficient process to handle and deliver this service to a high standard. To achieve this, businesses must optimise their logistics processes, leveraging technology and automation to reduce delivery times and costs. For example:

1. Increased adoption of automation and robotics will speed up warehousing processes, meaning items can be picked and packed faster, getting them 'on the road' in a fraction of the time
2. Integration of AI, algorithms and data analytics offers more transparency for both the seller and purchaser
3. Improved last-mile delivery through aforementioned automation solutions increased customer satisfaction

What does the future hold for ecommerce logistics?

Ecommerce logistics is a rapidly-evolving field, and businesses that can adapt to changing consumer demands and technological advancements will be well-positioned for success in 2023 and beyond. 

By embracing trends such as same-day delivery, autonomous delivery systems, sustainability, AI, and end-to-end visibility, businesses can optimise their logistics processes and meet customer needs more efficiently and effectively.

As ecommerce continues to evolve, etailers and logistics providers alike must adapt to meet the changing needs of consumers. Both parties are intertwined and depend on each other to ultimately fulfill the customer's needs to a high standard. For example, if ecommerce sales spike, logistics companies must be able to fulfill an increased volume of parcels.

Ecommerce logistics refers to the process of managing the flow of goods from the point of origin to the point of consumption, including transportation, storage, and distribution. 

How Codept can prepare you for the future of ecommerce logistics

As the integrators between ecommerce stores and warehouses, our solution connects ecommerce merchants with logistics providers for fulfillment and last mile to keep things moving. 

Our multi-channel fulfillment platform connects etailers and 3PLs quickly and easily to scale ecommerce activities, using powerful algorithms that save you time and money. 

We also recommend carrier optimisation strategies to enhance last-mile services and connect multiple providers through one powerful platform. 

To unify your ecommerce and logistics workflows, contact us to arrange a demo.

FAQs about Ecommerce Logistics 

Why is same-day delivery important in ecommerce logistics?

Same-day delivery is important in ecommerce logistics because it provides customers with a high level of convenience and satisfaction. 

With the rise of ecommerce, customers expect faster delivery times and same-day delivery is the next step in meeting those expectations. 

It also allows businesses to remain competitive and stand out in a crowded market. Additionally, same-day delivery can help businesses reduce inventory costs by allowing them to maintain smaller inventories since they can restock quickly. 

This can ultimately lead to cost savings and increased profitability.

How can businesses integrate autonomous delivery systems into their logistics processes?

Businesses can integrate autonomous delivery systems into their logistics processes by working with technology providers and logistics partners who specialise in this area. They can also invest in research and development to create their own autonomous delivery systems.

How can businesses prioritise sustainability in their ecommerce logistics processes?

Etailers can prioritise sustainability in their ecommerce logistics processes by using eco-friendly packaging materials and minimising single use plastics, whilst logistics companies should focus on using less emissive transportation methods.

Why is sustainability key to ecommerce success?

With growing consumer demand for green initiatives, ecommerce businesses that offer sustainable products and green delivery options put themselves a step ahead of their competition.

How can businesses leverage AI in their ecommerce logistics processes?

Businesses can leverage AI in their ecommerce logistics processes by using machine learning algorithms for demand forecasting, using natural language processing for chatbots and customer service and using computer vision for inventory management and quality control.

How can businesses optimise last mile delivery?

There are several ways businesses can optimise last mile delivery:

1. Utilise technology: Implementing technology such as route optimisation software, real-time tracking, and automated dispatch systems can help reduce delivery times and improve efficiency.
2. Partner with local delivery services: Partnering with local delivery services can help businesses expand their delivery coverage area and reduce delivery times.
3. Offer flexible delivery options: Providing customers with flexible delivery options such as same-day or scheduled delivery can help improve customer satisfaction and increase loyalty.
4. Improve communication: Keeping customers informed throughout the delivery process with regular updates and notifications can help manage expectations and reduce missed deliveries.
5. Streamline operations: Optimising warehouse and distribution centre operations can help reduce delivery times and improve overall efficiency in the delivery process.