52% say they would pay a premium to receive goods within two hours
40% of consumers have used on-demand delivery services in the previous 12 months
Yet, only 22% of retailers offer rapid retail delivery options
Non-food on-demand retail sales projected to overtake groceries by 2030
A significant gap exists between the percentage of consumers wanting rapid retail delivery and the number of retailers offering on-demand options, according to a new report published by Uber Direct and Retail Economics.
The study, based on research with 2,014 UK consumers and 200 retailers, found on-demand delivery was well established in the UK, in which 40% of consumers had used these services in the previous 12 months – a figure which rises to 66% among Gen Z (18-25 year olds).
While adoption of on-demand delivery has been led by the grocery sector to date, the study found significant interest across several non-food categories too. For instance, at least two thirds of consumers said they wanted this option for flowers and DIY and gardening items. The research also revealed that more than half of consumers (52%) would be willing to spend up to £10 to get goods delivered within two hours, when their basket size was worth £100 or more.
Just 22% of retailers are currently offering on-demand as a delivery option, however. The study identified several reasons why many retailers have been slow to roll out this service – these include cost (44%), operational strain (40%) and infrastructure challenges (39%).
Despite these challenges, the number of retailers rolling out on-demand delivery continues to grow in the UK, with non-food on-demand retail sales now projected to surpass groceries by 2030.
Richard Lim, CEO of Retail Economics, said: “There are many retail categories where one or two-day delivery windows are no longer enough to satisfy customers. Consumers increasingly want goods in their hands within minutes of buying online. As retailers find ways to meet that interest, expect on-demand delivery to accelerate over the coming years. The market may still be in its infancy, but the potential is huge.”
Mia Yamaguchi, retail development lead at Uber Direct UK & Ireland, said: “As demand in rapid retail grows, there’s a real opportunity for retailers to win over customers, boost sales and maintain their loyalty. This study, produced alongside Retail Economics, highlights the enormous potential for brands. It also identifies the ways retailers can overcome the barriers to adoption, such as by partnering with an established delivery provider.”
A full report on the Uber Direct and Retail Economics study is available to download here.
