Lessons From 11/11

23 November 2016

Lessons From Singles’ Day 2016

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What started in 1993 by students of Nanjing University in China to celebrate the pride of being single, has been transformed into the world’s biggest online sales event by Alibaba Group. Double 11 (Singles Day) sales in 2016 reached astronomical levels of 120.7 billion yuan (US$ 17.73 billion), representing a 32 percent growth from the previous year’s sales on this shopping gala day. Amazingly, 82% of the transactions were conducted through smartphones, the highest percentage of mobile usage for shopping in the world, by a huge margin…

In our part of the world, while this bonanza might not be anywhere near the scale of the Alibaba in China any time sooner, but is still however another avenue for online retailers to boost sales towards end of the year. It is with zest and vigour that Zap Delivery ran a collaborative campaign with a few select partner merchants to stress test ourselves and see what we are made of.

img_5929The initial target was to handle 5,000 to 7,000 deliveries for Double 11. Though the sales generated by our partner merchants did not reach that number, we still were able to put up some very decent numbers, over 3,000 to be exact. All items sold during Friday, November 11 were picked up and sent to our office for processing throughout the day. Our awesome team of Zappers worked throughout the entire Friday till the wee hours in the morning so that all parcels can be despatched our on Saturday morning and reach the hands of the consumers by the evening of the same day.

Some of the key lessons learnt from this whole exercise…

1. Scale Matters

Due to our conservative approach and the commitment to provide super fast delivery and exceptional service to our customers and their consumers, we have continuously scaled our operations at a manageable pace. With this Double 11 campaign, the intention is to stretch ourselves like never before in a bold and adventurous way. By arranging deliveries in sorties and tranches of around 500 a lot, we were able to see extremely nice clustering of routes and provide super efficient service for the consumers expecting their items and also our partner couriers, the guys who do the actual deliveries.

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It was such a beauty in our eyes, the density of the clusters that is our routes… Our smart routing  algorithm work! Some of the routes with 35-40 drop off locations were completed in over 2 hours. Now thats super efficient! The team were amazed by the actual results even though we all know what to expect. But the actual fact of that happening is truly a sight to behold and testament to the efforts of our guys cracking their brains to develop this awesome logistics platform with superb smart routing capabilities that is unmatched in this region.

2. The Gig Economy is a Reality

In a recent research conducted by Emergent Research in US, it is forecasted that by the year 2020, the number of independent workers — freelancers, contractors, and temporary employees, will reach 60 million people, or 40% of the population. In May 2015, that number was 15.5 million. Those numbers might not be as high in Singapore any time soon, but the signs are there. Freelance work and temporary work is here to stay. Driven by the on-demand and sharing economy, the shift towards independent contractor as an occupation is a undeniable social trend. 

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It is one thing to predict or imagine, it is however a totally different matter when you get to experience and see it with your own eyes… During the course of the Double 11 weekend, jobs were published and taken up in no time. It provides strong evidence that for a reasonable amount of money, people were willing to take up jobs and utilise their spare time and idle assets to make extra income. And to some extent, there are professional “gigsters” who are not full-time employees but chose to freelance and work according to their own preference and time schedule.

On Saturday itself when a lot of the couriers came to our office to pick up the parcels to be delivered, some of the people I see coming to our office strike me deeply. As I came into our office on Saturday morning, I saw this young kid about 10-12 years years old sitting on the opened back latch of a station wagon, and playing with his mobile phone. Another 10 minutes later, I saw this kid coming in with a lady (presumably his mother) in her late 30s. They were here to pick up the stuff they has taken on to deliver. Some minutes later, another man in his early 40s (presumably her husband and his father) came in to help with the taking over of the items. They have taken up the job for 70 plus deliveries close to where they stay. They would make the deliveries over the day and end up with over $200 extra income. So it’s a 3 family member tag team!

img_5941Perhaps another half an hour later, two young kids in their early 20s came in and I happen to assist them with the handing over of the particular route they have taken on to deliver. During that 5 minutes of so of the taking over process, it started to rain. I helped to provide these 2  young guys with big plastic bags to put the items they are supposed to deliver and shield them from the rain. Two bagful of items, and they took two trips to put those items in the car boot. Looks like a small Honda Fit, and one of them holding umbrella to shield the other from the rain, and the other holding the big plastic bag with the items. First thing that came into my head was “probably a rented car to provide Uber or Grab services.”

The weather got better and the rain stopped less than an hour after it started. The sun started to shine bright, and more interesting people came in… A guy in his late 20s came in with a big backlit oh his back, an interesting character. Then he packed away the items neatly into his back pack, one that looked more suitable on a mountaineering mission. As he walked out, I kept a close lookout and saw this young guy hopping onto a bike! As he cycled away, I was in awe. I mean, we have all kinds of people walking in our office all the time, but it still require some time to sink in. There is this guy who just packed 34 items into his huge back pack and riding away to deliver in his bike!

3. Social Impact

Singapore is a fairly well off country. In 2015, the average monthly income from work per household member is $2,500. Broken down into deciles, the average monthly income from work per household member is $541 (1st to 10th decile), $1,040 (11th to 20th decile), $1,446 (21st to 30th decile), $1,857 (31st to 40th decile), and $2,274 (41st to 50th decile).

In the logistics industry, a courier on motorbike typically makes about $1,400 to $1,600 a month, placing them in the 21st to 30th decile. A driver operating a lorry for a logistics company now makes $2,500 to $3,000 a month, placing them in the 51st to 60th decile in terms of monthly income.

lighting-a-sparkWhen we started Zap Delivery, one of our key objectives is to be able to make a difference to society and help people in the lower income brackets to raise their earning potential through the use of technology to provide efficient matching and optimised usage of time and idle assets. We hope to raise that $1,500 average monthly income to a number closer to $2,500 or even more. The ability to increase the number of deliveries through route optimisation in a given time through our platform has been proven to be a reality that is becoming truer by the way as we scale up. That dream to help lower income families make more money to provide for their family members is not far away…

The underlying objective of any business is to turn a profit in a sustainable way, and in turn provide a stable environment for their employees to generate income to feed their families. In the case of Zap Delivery, we envision the provision of jobs in a non-traditional way and the ability of higher income for the people working on our platform. This is still a work in progress, but the awesome team we have in place is not losing of the objective and working hard each day to make this dream a reality!

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