As the world of parcel shipping continues to shift and evolve, alternative delivery is becoming increasingly popular among shippers and consumers.
However, alternative delivery methods are more than just a trend—they’re a strategy. And when employed correctly, they can lower costs and increase efficiency.
Despite challenges from the aftershocks of COVID-19 and ongoing inflation, experts are preparing to see continued growth for the shipping world. A 2024 report from Statista found that revenue in the U.S. eCommerce market will reach $1.382 trillion by 2025. Similarly, Pitney Bowes expects U.S. parcel volume to reach 23 to 35 billion by 2029.
As eCommerce demand keeps growing, shippers must stay competitive. One way to do this is by using alternative delivery channels.
What is Alternative Delivery?
Alternative delivery channels go beyond traditional home delivery methods to give customers more flexibility and convenience. They also help businesses cut costs and improve last-mile delivery efficiency.
Types of Alternative Delivery Methods
People want flexible shipping options, creating a market for a variety of alternative delivery methods.
Some shipping options, like drone delivery, are still being developed. Others, like parcel lockers, have been around since the early 2000s.
Parcel Lockers
Since the first parcel lockers were created in Germany in 2003, they have provided convenience and security for consumers. Customers in the UK say that “parcel anxiety” from porch pirates is why they choose delivery lockers. The “parcel anxiety” is valid, as, in 2024, porch pirates stole $12 billion in goods in the U.S.
It’s evident that consumers want safe and secure options available to combat theft—especially when it comes to high dollar parcels. A 2024 Sifted survey found that over 1 in 3 consumers want items worth $250 or more delivered securely. If many of your products are priced this way, you should consider smart parcel lockers as a delivery option.
Regardless of what may be driving consumers to opt for parcel lockers, major carriers, such as USPS are investing in them. USPS Smart Lockers are free to customers and are continuing to expand their presence in Post Office locations nationwide. Another popular parcel locker spot is Whole Foods Market; a natural fit since Amazon acquired the grocery chain in 2017.
Parcel lockers aren’t going anywhere soon. The use of parcel lockers globally is growing exponentially, and is expected to go from $800 million in 2022 to $2 billion by 2030.
How Parcel Lockers Benefit Shippers
- Increased Sense of Security: Most parcel lockers use a keyless system, providing customers with secure access codes. Shippers can expect their customers to feel an increased sense of security as these lockers are designed to prevent package theft.
- 24/7 Access: The capability to pick up your parcel anytime, with the guarantee that it’s in a secure place, could create a better experience for customers.
Drone Delivery
It should come as no surprise to shippers that big retailers are investing in drones. They want to speed up delivery to meet consumer demands, especially in suburban areas.
Several cities in the U.S. are becoming test beds for drone delivery, one of which is Fort Worth, Texas, where people are calling it the ‘drone delivery capital of America’. Google’s Wing and Flytrex are two key players making drone delivery possible for residents in this area. They are using drones for both parcel and food delivery.
Another key player driving drone delivery growth in Texas is Walmart Drone Delivery. Walmart announced on Jan. 9, 2024 that they have plans to make the largest drone delivery expansion of any U.S. retailer. They will offer drone delivery to 1.8 million more homes, including the entire Dallas Fort-Worth area. Walmart, with help from Wing and Zipline, has already made over 20,000 safe deliveries. The CEO of Wing said, “The demand for drone delivery is real.”
Walmart isn’t the only one making moves in the delivery space. Amazon Drone Delivery is aiming to deliver 500 million packages annually by the end of the decade.
Drone delivery will grow in 2025, but widespread adaptation is halted by ongoing regulatory hurdles, infrastructure requirements, and software issues.
How Drone Delivery Benefits Shippers
- Rapid Delivery Times: Some drones can deliver packages in less than an hour, as opposed to traditional delivery. Drones avoid challenges such as construction, accidents, and strikes.
- Ability to Reach Remote Areas: Drone delivery is a possible solution to delivering parcels to remote areas. In rural communities or towns without street delivery, or even mountainous terrains, drones could provide reliable transport without risking human safety.
BOPIS: Buy Online, Pick Up in Store
One of the most widespread alternative delivery options is buy online, pick up in store—or BOPIS. This method allows customers to place their orders online, usually through a mobile app or website, and go in-person to pick up their order.
Oftentimes, retailers and grocery stores will have two options available for customers: Pick the order up inside the store, or, curbside/drive-up.
Customers have real-time visibility into store inventory to see what items are available, which can be appealing to customers who don’t want to browse the store in person for specific items.
According to a report from AlixPartners, 40% of retailers offer BOPIS. Businesses like Target, have spent the years following the pandemic focused on tailoring their same-day BOPIS service. In 2022, sales fulfilled through Target Drive Up grew more than 70%.
Target isn’t the only company seeing success from BOPIS. Nordstrom launched their own version of BOPIS, Nordstrom Local. By early 2022, 39% of total sales were online orders, a success which their CEO attributed to BOPIS sales.
How BOPIS Benefits Shippers
- Convenience: BOPIS allows businesses to get products into the customer’s hands fast. Having this option available to consumers creates a customer experience that is both expedited and easy.
- Brand Awareness: Unlike some other alternative delivery services, BOPIS creates an opportunity for the brand to connect with the consumer, either during pick-up in store or in the parking lot. This could be appealing for businesses who still want to maintain a physical touchpoint to create a relationship with their customers.
Autonomous Vehicles
Autonomous delivery vehicles are another alternative delivery service disrupting industries globally, including the shipping industry.
Autonomous vehicles are self-driving with capabilities to sensor their environment using AI, reducing the need for human labor.
In 2024, The American Trucking Association estimated a labor shortage of upwards of 174,500 drivers. That, coupled with a need for faster shipping, has created a chance for autonomous trucks and vehicles to help.
Digit, a bipedal robot developed by Agility Robotics, takes automation a step further by seamlessly integrating with autonomous vehicles. Designed to unfold itself from the vehicle’s cargo area, Digit can retrieve packages and navigate to residents’ doorsteps, offering a glimpse into the future of last-mile delivery.
How Autonomous Vehicles Benefit Shippers
- Cost-Reduction: Last-mile autonomous delivery vehicles are associated with cost-reduction due to lower labor costs.
- Enhanced Delivery Efficiency: They also offer increased efficiency, and improved accuracy and reliability due to a lower chance of human error.
Crowdsourced Delivery
According to research conducted by Roadie, almost 90% of retailers are expected to use crowdsourced delivery by 2028.
But, what exactly does crowdsourced delivery mean?
Crowdsourced delivery is a model of logistics that leverages a network of independent contractors to fulfill last-mile delivery needs. This often includes individuals driving their own vehicles connected through an app or online platform. This approach is similar to ride-sharing platforms like Uber Eats and DoorDash.
How Crowdsourcing Delivery Benefits Shippers
- Scalable & Flexible Delivery Network: A significant advantage shippers have when crowdsourcing is the ability to increase or decrease delivery capacity depending on demand. Shippers can leverage an existing network of drivers during peak season as needed.
- Enhanced Customer Experience: Modern consumers expect precision when it comes to delivery times and live tracking. Crowdsourced delivery allows customers to see exactly when a driver will arrive.
- Faster Delivery at a Lower Cost: Crowdsourcing helps shippers save money. They can avoid costs for vehicle maintenance, fuel, insurance, and driver wages. They only pay for completed deliveries.
Challenges of Alternative Delivery Methods
Consumer Concerns
Home delivery is still king in 2025. One of the biggest challenges of non-traditional delivery options is pushback from consumers. Many people still prefer traditional home delivery.
For instance, some consumers express concern about the limitations of parcel lockers. Since the value proposition of ordering online is that it’s delivered right to their doorstep, it could be difficult to convince habitual home delivery consumers to make the switch.
Another concern is that fast delivery, like drone delivery, raises the need for instant gratification in eCommerce. This challenge is often called “The Amazon Effect,” or the expectation that standard shipping will arrive in two days.
A Voxware survey found that 48% of consumers expect packages to arrive within two days. Drone delivery can make the time people wait for packages even shorter. Companies without this technology may find it hard to meet the demand for quick and accurate delivery.
Adapting to New Delivery Methods: Best Practices for Shippers
For shippers, capitalizing on new delivery methods requires a strategic approach. If speed, cost, and customer satisfaction are priorities, it might be beneficial to explore alternative delivery models.
Staying informed about emerging delivery technologies in your area is a great first step.
That’s where Sifted can help.
Sifted’s newsletters keep you up-to-date with important industry news, reports, trends, and shipping tips. Get a weekly update on LinkedIn with The Parcel Playbook, or a monthly update straight to your inbox with Unboxed.
