In Parcel Shipping,
The Joneses are Amazon and Everyone Has to Keep Up
In our third episode of Better Yet, Denise McCann of Renegade Logistics sat down with Jason Murray, co-founder and CEO at Shipium, and Andy Whiting, co-founder and CEO at Better Trucks, to talk tech in the parcel shipping industry. This trio of logistics powerhouses discussed how Amazon has changed the game for everyone by setting new consumer expectations and how technology is shaping what happens after we hit ‘Buy’.
It’s hard to ignore the elephant in the room, and in the shipping industry, Amazon is still that elephant. They’re the big dog, with their selection, competitive pricing, and reliability propping them up in the market to stand as countless Americans’ go-to online retailer. They’re not so much the one to beat as they are the one everyone needs to try to keep up with in order to keep customers happy and coming back.

But how does Amazon make it happen, and, even more importantly, how can other companies offer similar shipping options to gain or keep their toehold in the market? Jason, Andy, and Denise discussed just that in the third installment of Better Yet.
“The reason people always go back to Amazon is that they know when they're going to get their item. They have a predictable promise.” -Jason Murray, Shipium
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Thanks to his extensive experience working with Amazon in a key role to help develop the tech that makes the 2-day delivery we all know and love possible (physically and financially), Jason has a unique perspective on how the average company can live up to those promises.

Jason pointed out that Amazon reels customers in with their broad selection, competitive pricing, and fast, reliable shipping. 

Outside of Amazon, it's our responsibility to start bringing that discipline and that focus to the rest of the market,” said Murray.

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“What really separates Amazon and gives that predictability on the promise is the aligned stack of fulfillment, sortation, and delivery in one.” - Andy Whiting, Better Trucks

Amazon has set the bar for other e-Commerce retailers, and there’s a lot other business leaders can take away from their strategy, methods, and success.

Both Andy and Jason had similar ideas on what those takeaways should be.

As you look at other e-commerce retailers, how are they gonna compete? They can't just have a slow regional delivery company that bolts onto the end of the ship or vice versa, if they have a bad fulfillment experience or inventory placement experience, and they bolt it on, and it is upstream from us, that customer promise is not as easy to make. And so I think it's a combination of technology companies like ourselves that are actually gonna give retailers the ability to compete alongside Amazon,” said Andy.

The magic of Amazon was really the technology. Technology allows you to use data for things like prediction and process improvement. It also really allows you to codify these operational improvements and actually create a feedback loop that truly does improve over time,” said Jason.

Essentially, finding the right tech stack that works together and is coordinated can be a huge differentiator for retailers looking for a way to keep up.

“If you can build predictive models, you can essentially shape the world and the way you route things, the way you move things, to hit that prediction.” - Jason Murray, Shipium
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When Denise asked about how technology is shaping parcel delivery today, Jason and Andy agree that just having good tech makes all the difference.

The beautiful thing about software is that it's gonna do the same thing over and over every time. It's not bound by human nature. We make mistakes. We can only keep so much information in our heads. And if the problem is such that it is this repeatable operational problem, it really works great to just keep hammering on building these optimizations and these processes and this communication into software so that you're always gonna get the best possible outcome,” said Jason.

Andy pointed out that being a digitally native company in this environment has made a huge difference in Better Trucks’ ability to keep up.

Not coming from a former way of doing business that we had to transform from, it's just native (at Better Trucks). It's what people expect and it's what we expect as a company as well. So you imagine when you make improvements to your staff, it doesn't take weeks or, or I'll say, months or years for those to give feedback. This is stuff that is almost instantaneous. The next order that goes out is now able to take into account that improvement,” said Andy.

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“Companies like UPS and FedEx are lagging behind in some of their tech investments. The world is progressing ahead of them.” - Andy Whiting, Better Trucks

When it comes to the duopoly, our speakers all doubt whether they’ve kept up with times as far as technology goes.

26 years at FedEx and I adore Fred Smith, the man who founded the company, and he would come in a room and he would say, listen, we are an IT company that just happens to move packages. Now, I believe that in the past, and I don't know if they have kept up, right?” said Denise.

“The world around you is continually changing. And so it's extremely important that you're always investing to keep up with that. And that's just the reality,” said Jason.

“The multi-carrier model is a really good example of where software can take that complexity and turn that into a structural advantage” - Jason Murray, Shipium
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With Shipium, shippers typically go from an average of one carrier to six in their first quarter with the company, so Jason has some great outlooks on adding carriers strategically, and the key role technology plays in doing so.

It's a really good example of where software can take that complexity and turn that into a structural advantage for you. And if you embrace technology as this enabler there, then it seems like a net negative thing,” said Jason.

Tech allows shippers to look at carriers as an asset rather than a liability by providing a proven way forward. When tech companies like Shipium and tech-forward carriers like Better Trucks work together, shipping with multiple carriers is really not so different from working with a single carrier.

The quality and speed of the delivery experience is critically important to e-commerce retailers and their customers. 

Shipping is the most expensive part of an e-commerce business. It's also the biggest conversion driver in an e-commerce business,” said Jason.

Thanks to all our speakers for drilling down on the Amazon effect, tech’s role in the evolution of parcel shipping, and the shift to multi-carrier strategies and how technology makes that possible!

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