Home Delivery for the Ages: The Demographic Opportunity
Not all consumers are the same — and retailers are realizing that it’s not just buying behavior that differs across customers. While most e-commerce merchants employ data-backed buyer personas that describe what drives each ideal customer to purchase, many vendors are recognizing the value of implementing delivery personas and tailoring their delivery options to meet different consumer needs and expectations.
Similar to the breadth of buyer personas, delivery personas reflect a range of varying consumer desires and expectations around factors like speed, cost, and convenience. But do Gen X and Gen Z expect the same delivery experience? Are Millennials and Boomers regularly opting for next-day delivery? How do delivery personas differ between age groups? A 2023 study of more than 8,000 consumers across ten European and North American countries examined the state of e-commerce and home delivery performance and how demographics impact online buying habits and delivery preferences.
Meeting Delivery Expectations Across the Age Divide
When examining online shopping habits and home delivery expectations, the survey revealed that the reasons people choose online shopping — and why some consumers will receive more e-commerce deliveries than last year — are similar across all demographics, from Gen Z and late Millennials (18-34 years) to early Gen X and Baby Boomers (55+ years) and everything in between:
- People are accustomed to the convenience of shopping from and receiving their delivery at home.
- The order process is easier.
- They don’t have to go out of their way to pick up the items they need.
Similarly, consumers of all ages share the belief that security is the most important element (81 percent vs. 74 percent in 2022) of the delivery process — not a surprise given the rise of porch pirates, with a reported 260,000 packages stolen across the U.S. in 2022.
What Do Millennials and Gen Z Want?
While the same factors drive online shopping across all demographics, delivery expectations diverge by age. Older buyers are more inexperienced with ordering online compared to younger consumers who grew up with smartphones and for whom online shopping is second nature. The 2023 study found that Millennials and Gen Z consumers tend to shop and spend more money and are more inclined to increase e-commerce spend (50 percent vs. 33 percent of 55+ consumers).
As a result of online buying habits, Millennials and Gen Z are much more demanding of retailers’ delivery execution. Plus, when faced with a delivery issue, younger consumers are more likely to act against the retailer, like detailing their complaint on TikTok or warning family and friends to steer clear of the brand (see Figure 1).
When planning delivery offerings to meet the expectations of the younger cohort, e-commerce merchants must recognize that these consumers are most concerned about speed of delivery, rather than cost. In fact, 39 percent of respondents in the 18-34 age group prioritize speed, compared to just 19 percent of early Gen X and Baby Boomers.
Additionally, of the different age cohorts, Millennials and Gen Z consumers are most interested in sustainable delivery options — although it’s a choice, not a delivery requirement. With the current economic uncertainty and shrinking disposable incomes, the environment has become less of a factor in delivery decisions for all age groups compared to last year.
Speaking Boomers’ Delivery Language
If Baby Boomer and early Gen X consumers aren’t focused on delivery speed, what do they value in their delivery experience? Price is the primary factor driving delivery choices for this group. They are characterized by the cost-conscious delivery persona and, as such, are willing to forgo speed in order to save (see Figure 2).
Case in point: half of the early Gen X and Boomers surveyed prioritized lowest cost and agreed that speed is unimportant, compared with 30 percent of respondents in the 18-34 year range. Notably, 47 percent of the 55+ age group cited less disposable income — a dramatic increase from 19 percent in 2022 — as a reason for putting off future online purchases.
While the 55+ age group purchases less online and is not as e-commerce-savvy as Millennial and Gen Z consumers, they are, however, becoming increasingly comfortable with online shopping. In 2023, only 36 percent of older consumers said they prefer to see a product in person before buying, compared to 55 percent the previous year.
Room for Improvement
Tailoring delivery options to the range of delivery personas -- and recognizing how consumer delivery preferences and expectations vary across the demographic spectrum -- is an important building block to forging long-lasting customer relationships. Unfortunately, many retailers are falling short in their efforts. While the 2023 study reported a 6 percent improvement in delivery performance over 2022 figures, 67 percent experienced a delivery failure in the three-month evaluation period. And of those affected by delivery issues, 68 percent took action that translated into negative consequences for the merchant or delivery company -- whether refusing to order from the retailer again, losing trust in the delivery company and/or retailer, posting their dissatisfaction on social media, or telling family and friends to avoid the merchant and/or delivery company. Notably, 80 percent of Gen Z and Millennials were inclined to take some form of action against the retailer, compared with only 53 percent of the 55+ age group.
E-commerce improvements are spurring a broader demographic to buy a wider range of goods online, leading to more home deliveries and opportunities for merchants to delight customers with a satisfying delivery experience. But given the recent mediocre last mile performance report card, e-commerce merchants need to take steps to better meet home delivery expectations -- starting by evaluating values, priorities, and preferences of the various demographics to help define multiple delivery personas.
For e-commerce merchants who recognize the importance of demographics when it comes to delivery, the opportunity exists to use a tailored home delivery experience as a competitive differentiator. Understanding customer delivery personas and how consumer expectations shift across ages will help retailers enhance customer experience and improve brand enthusiasm and loyalty to strengthen the bottom line.
Johannes Panzer is Head of Industry Solutions, Ecommerce 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.