How Retailers Win Across Generations With Targeted Delivery Experiences

As major e-commerce players continue to adjust their strategies to cater to diverse consumer needs — from Amazon.com expanding fast delivery into rural areas to Walmart unveiling on-demand 6 am delivery — retailers of all sizes are scrambling to stay relevant and competitive. At the heart of this shift lies a critical challenge: the generational divide in online shopping expectations, particularly e-commerce deliveries.

The good news for retailers is that consumers in every demographic are buying more online and ordering more frequently. Furthermore, they’re expanding into new product categories, according to a recent Descartes study of e-commerce and home delivery consumer sentiment. Indeed, consumers expect to make nearly half (49.5 percent) of all purchases online within the next year, with 52 percent of North American shoppers expecting to buy online more often than at a brick-and mortar store within a 12-month period.

More e-commerce purchases means more last-mile deliveries — and a range of delivery preferences for different types of delivery personas. For example, Gen Z prioritizes the environment in their delivery decisions, boomers value convenience, and millennials and Gen Xers share a range of preferences surrounding when they will receive their package, how fast it will be delivered, and how much it will cost. Savvy retailers dialed into demographic nuances will tailor the home delivery experience accordingly to uplevel customer satisfaction, foster organic referrals, and drive repeat sales across all age groups.

How it’s Going So Far

How well are retailers catering to the diverse home delivery expectations of generational cohorts in 2024? With two-thirds (67 percent) of all consumers experiencing delivery issues in the three-month period surveyed, let’s just say there’s room for improvement — especially when it comes to appealing to younger generations and crafting e-commerce strategies around their values ​​and delivery preferences.

While a remarkable 96 percent of survey respondents over the age of 65 indicated they’re satisfied with their delivery experience, Gen Z, millennials, and Gen Xers are not singing the same praises of retailers. Only 71 percent of those aged 18-24 are satisfied with their e-commerce delivery experience, and 19 percent of 34-55-year-olds say they’re “occasionally, not that often, or never” satisfied. These are discouraging statistics for retailers aiming to capture a greater share of wallet.

According to the Descartes survey, younger respondents’ higher delivery expectations correspond to the greater number of problems they report, whether that’s deliveries arriving later than promised (28 percent) or at a different time (29 percent), a longer-than-desired delivery time (23 percent), or a damaged delivery (25 percent).

Adding fuel to the fire, younger consumers who experience poor delivery service are more likely to take some form of action against the retailer. In fact, 80 percent of 18-24-year-olds took action that had negative consequences for the retailer or delivery company, compared to only 62 percent of the 65-plus age group.

With nearly a quarter (23 percent) of the 18-24-year-old demographic confirming they lose trust in the retailer after poor delivery service and 22 percent indicating they don’t buy from that retailer again, the delivery experience takes on an even greater role in brand preservation. If retailers neglect delivery improvements, they risk losing the next generation of consumers.

Pushing the Right Buttons

What factors are driving the e-commerce behavior of generational cohorts? While 57 percent of consumers across all demographics enjoy the convenience of the online buying and delivery model, brands need to take note that the convenience factor is particularly strong (71 percent) among seniors aged 65-plus, up 6 percent from last year. By contrast, only 42 percent of respondents aged 18-24 cited “getting used to the convenience” as a motivating factor in purchase decisions.

Eschewing convenience, younger consumers (we’re looking at you, Gen Z) are acutely tuned into environmental issues, with 83 percent of 18-24-year-olds (plus 71 percent of those aged 25-34) considering the environmental impact of their online purchases. This compares to just 43 percent of the 65-plus group. These age-related discrepancies highlight a prime opportunity for retailers to customize delivery services to build brand loyalty across generations.

Bridging the Generational Gap

By tailoring the delivery experience to resonate with target audiences across the age spectrum, retailers and brands have the opportunity to satisfy customer expectations, build brand loyalty, and drive repeat sales. Retailers looking to appeal to baby boomers and older generations should prioritize convenience in their delivery options, offering consumers the flexibility to choose when and where to have items delivered. Same- and next-day delivery and precise delivery windows at the point of sale will appeal to this group.

For younger generations more motivated by sustainability, offering green delivery slots (eg, bundling deliveries to increase drop density, using carbon-neutral electric delivery vehicles) will appeal to those wanting to reduce their carbon footprint. Notably, more than a third (37 percent) of consumers — across all ages — would welcome the ability to combine orders over a period into a single delivery at the end of the week.

For retailers struggling to understand and accommodate the generational nuances of an ideal delivery experience, building a last-mile strategy around customer delivery personas that reflects home delivery preferences is a smart first step. As e-commerce continues to evolve, recognize and address the generational tug-of-war, there will be an ongoing objective for retailers aiming to thrive in an intense competitive landscape.

Johannes Panzer is head of industry solutions, e-commerce at Descartes, the global leader in providing on-demand, software-as-a-service solutions focused on improving the productivity, performance and security of logistics-intensive businesses.