On Demand Courier Delivery App Development - 3 KPIs That'll Boost Your Parcel Delivery Orders
Nowadays, businesses from various industries are assessing the need for on-demand mobile app development.
And why not! The speed at which the on demand apps are disrupting one industry after another is something nobody expected. And now that the on demand business model has had so much impact, it makes perfect sense for businesses to join the forces of on demand bandwagon.
Thanks to Uber to set the ball rolling, the on-demand business model is now being utilized in a vast variety of businesses including the courier delivery industry.
Although, you can’t just duplicate the on-demand business model in your courier delivery business. There are certain pitfalls to avoid and factors to consider.
If you fail to do so, you might end up closing the business just like UberRUSH had to.
In March 2018, Uber announced their plan to shut down UberRUSH operations on June 30th, 2018.
The main reason behind this is because UberRUSH was launched based on the idea that people won’t mind paying extra money to get their courier delivered fast.
This assumption led UberRUSH into a trap, as consumers want fast delivery but don’t want to overpay for it. As a result, they couldn’t make their on demand courier delivery service profitable.
Lesson learned? – you can’t replicate the exact business model from one niche to another.
The key performance indicators are different in each business niche.
Below, we’ve mentioned the most important KPIs for an on demand courier delivery app to track.
3 Key Performance Indicators For On-Demand Courier Delivery App Development
To make your on demand courier delivery app successful, you need to consider 3 KPIs:
- User Acquisition
- User Retention (Both customers & Delivery Agents)
- Transportation Cost Cutting
1 – User Acquisition
The main idea behind the on demand business model is to provide cheaper and faster delivery.
So, in order to attract a lot of customers to use your courier delivery services, you should consider doing the following:
- Start Local: Whether you’re launching a new startup or adding on demand service to your existing courier delivery business, it’s always wise to start local with a smaller investment.In fact, Uber did the same thing. Uber was started in New York with only three cars. And if you think about it, starting local will not just help you in identify the actual demand, but it will also help in growing your user base through word-of-mouth.
- Pre-Launch Marketing: To launch your on demand courier delivery app successfully, it’s critical to advertise your app before its launch. In fact, you should utilize as many promotion channels as you can, including social media and public outreach for example.
- Referral Program: Referral programs have proven to be the most effective way to attract a large number of potential customers. Referral programs are basically offers given as an incentive to customers for referring their friends to download your app.
In fact, Uber utilized referral program strategy very smartly. They started sponsoring the events in Silicon Valley and offering a free ride to the venue. As a result, those influential Silicon Valley people started talking about Uber on their social media and blogs.
2 – User Retention
User retention applies to both stakeholders (customers & delivery agents) in the on-demand courier delivery app business.
Below are some strategies that will be helpful in retaining both customers and delivery agents for your courier delivery app.
First, let’s talk about retaining customers.
Customer Retention Strategies
Nowadays, customers stay loyal to a business that satisfied their needs. And this applies to courier delivery business as well. In fact, very less amount of customers will go out to try the services of a different company if they’ve already found a company that satisfies their needs.
With that being said, here are a couple of ways you can win the trust of your potential customers and retain them.
- Customer Support: You need to make sure that your customers, especially the new ones, receive quick and friendly responses to their queries and complaints. Also, the customer support feature should be easy to access in your courier delivery app.
- Feedback System: Feedback is a great way to find pain-points of customers and where your services might have let them down. This way, you can collect important feedback from customers and make necessary changes to keep customers happy. For example, after a courier gets delivered, the customers should be prompted with a super-quick feedback form.Uber, for example, has nailed the feedback system in their taxi booking app. Whenever an Uber driver receives too many negative feedback, their account immediately gets suspended until they pay for and attend Uber training session.
- Special Offers: Offers are (and have always been) one of the greatest way to retain customers. In your courier delivery app, you can give discounts, gifts, and vouchers from time to time to successfully retain the customers.
The above-mentioned strategies are only one part of user retention KPI. The other part is retaining the delivery agents.
Delivery Agent Retention Strategies
Following are the best strategies you can use to retain delivery agents for your on demand courier delivery app.
Flexible Work Schedule: Nowadays, people want the freedom to work anytime they want to. And this is the main reason why on demand services are attractive to delivery agents as it provides flexibility in terms of work schedule.
Rates: In any on demand business, it is important to keep the pricing as low as possible to keep customers coming. But the problem with the low pricing is, you’ve to pay delivery agents’ fees as well. As a result, the rates for delivery agents becomes very low.
To tackle this situation, you should consider subsidizing their transportation costs like paying for gas expenses based on the distance between source and destination. This way, you can cover their gas expenses and pay them a fixed amount for each delivery and minimize your transportation costing.
The above mentioned is just one strategy to cut costs. There are many more strategies you can implement in your own on demand courier delivery app startup to reduce transportation expenses.
Transportation Cost-Cutting Strategies
We’ve analyzed many different on demand delivery apps and found following few ways you can cut your transportation costs.
- Deliver to Selected Areas: Serving only selected areas, especially when you’re just starting out, could help you in optimizing transportation costs. Deliv, for example, only accepts courier delivery orders if their delivery agents are within 15-mile radius.
- Cheap Transport Options: One great way to reduce transportation costs is by attracting bike riders to join your startup as delivery agents. As you know, delivery by bike is much cheaper to transport courier than by car. Plus, the job opportunity is a great fit for students wanting to earn some money.
- Synchronize Routes: This delivery model was introduced by Hitch and Roadie. In this model, the delivery job is assigned to drivers who are headed to the destination.
Depending on the size of package and distance, the driver agents earn anything between $8 to $650 per delivery. And the best thing about this model is that it allows on demand courier delivery businesses save money on transportation by assigning the job to driver headed to the destination.
So, these are the main important KPIs you need to track for you on demand courier delivery app business.
On demand apps are not going to fade away soon and the sooner you realize this fact the better it is for your courier delivery business.
With that being said, if you’re serious about launching your own on demand courier delivery app, make sure to consult with an experienced mobile app development company before you proceed.
The right partner can help you identify present market scenario, challenges, and best way to market and monetize your app.