April 22, 2021
The convenience truth: making PUDO attractive in South Korea
This blog article is part of our South Korea market insight series, exploring opportunities for parcel carriers and offering insight and comparison to other parcel markets around the world. Download your free copy of our South Korea market report here.
Consumer expectations run high in South Korea – shoppers want convenient returns, fast delivery to their homes, and zero hassle at all times.
They buy lots of smaller, everyday items online. But if delivery timescales are too long, they will revert to picking things up from a nearby store, of which there are many. That combination has helped foster the growth of next-day and same-day delivery services from online retailers who don’t want to miss out.
Lockers are not a popular choice – around 95-99% of orders still go to the shopper’s home and failed delivery rates are low as doorstep theft or ‘porch piracy’ is almost non-existent.
The watchword in this market is convenience. How do you convince customers to change their behaviour when they are so happy with the status quo? Not by making things more complicated or adding layers of cost and inconvenience, that’s for sure.
It might seem like an impossible challenge. But doing nothing is not an option. From a cost perspective, a delivery vehicle taking 50 parcels to a single PUDO location is a more attractive option than the same vehicle taking those same parcels to 50 home addresses.
But how to convince shoppers to use a PUDO offering? Well, elsewhere in the world, Amazon have begun to do this through incentives and psychological ‘nudge’ techniques in their checkout journey.
For low value items being delivered to certain areas, where the retailer recognises that it’s not profitable for them to offer rapid home delivery, their Prime promise is offered only through PUDO collection counters and lockers. Pricing incentives, such as offering free delivery to all PUDO locations, and having a basket value target for free home delivery, can also help to guide customers towards using out-of-home delivery options.
South Korean shoppers have already shown themselves to favour a quick trip to the store over waiting for delivery. Using a PUDO network as a way to capitalise on that existing behaviour could be a solid first step in shifting attitudes and reducing the cost of delivery for carriers.
To find out how Doddle can help you improve your customer experience and bring innovation to your last mile deliveries, get in touch today.