Inside the access economy: Amazon and Nimber forge different paths to optimise logistics
EXCLUSIVE: As Amazon and Sainsbury's ramp up efforts to improve delivery times, the chief executive of 'social delivery' service Nimber has claimed that the next few years will be a defining era for crowd logistics and the sharing economy.
Earlier this week, Amazon unveiled its new ‘Flex’ initiative, which aims to significantly decrease the delivery times of orders by taking trucks off roads and getting individuals to pick up and deliver packages for up to £15 an hour.
In response to its fresh-produce-selling rival, Sainsbury’s has also just announced that it is trialling a same-day delivery service, which could be expanded to 30 UK stores by Christmas. The supermarket also revealed that 100 new ‘Click & Collect Groceries’ sites are in the pipeline for the next 12 months.
For peer-to-peer delivery service Nimber, which expects the UK to become its primary market by the end of 2016, the exponential growth of online shopping has forced these larger companies to begin adopting new business models in a bid to remain competitive within the ever-changing online retail world.
But with Amazon adopting the ‘Uber approach’ and essentially monetising the availability of consumers to transport goods, surely this puts Nimber’s role in growing the sharing economy in the UK at risk?
According to the company’s chief executive Ari Kestin, Amazon Flex isn’t viewed by Nimber as a “threat”, but rather as an example of how companies are quickly turning to crowd logistics – paying individuals to deliver a product or service – to usher in a new form of the sharing economy, which Kestin dubs the “access economy”.
“People are no longer going to the shops to buy – they’re going online, and the question is how to get the product to their homes. Amazon Flex is a potential solution to that problem,” Kestin told edie.
“When we talk about the sharing economy there are lots of different types of models out there, on one side there’s Airbnb and Nimber, which are matching platforms of capacity and needs, and then you have other models such as Uber and Amazon Flex that are actually looking to replace existing models with their own.
“In my opinion, the latter model is trying to control the entire delivery experience from to start to end. This is more of an aggregation model where people sign up wear the t-shirt but not as an employee.
“However, the main goal is to establish the most efficient solution we can, and this means different things for different people. Efficiency can cover sustainability, economics and customer experience and companies have to pick which one is relevant to them. We don’t necessarily believe that all models are the same, Flex isn’t a threat to Nimber and Nimber isn’t a threat to Flex, they are different solutions to tailor to different needs and capacity.”
Having arrived in the UK in 2015, Nimber has seen its system of utilising a community of ‘senders’ and ‘bringers’ to deliver items as part of a commute or regular journey rise in popularity as the nation begins to come back around to the idea of ‘sharing’ and social platforms.
Kestin revealed that his business has been thriving in the UK to the point where it looks set to become the dominant marketplace for the company, which has its roots in Norway. The concept of the sharing economy in the UK is most commonly related to car-sharing platforms and accomodation, but as Nimber’s community grows, so does the sharing economy concept as a whole.
But this didn’t transpire without some initial scepticism. Kestin noted that as an “early pioneer” of the sharing movement, Nimber has had to help build both the demand and the supply from scratch. And the fact that big companies are now turning to similar models to replace incumbents is a testament to the success of an otherwise fledgling sharing economy in the UK.
For Kestin, the likes of Amazon, Sainsbury’s and Nimber could all be in a position to deliver different principles of the sharing economy – or the “access economy”, as he puts it. While the immediate benefits include creating active and reliable communities and a reduction in heavy polluting trucks on the roads, Kestin anticipates a time where data and innovation drives the concept to new heights.
Amazon is already exploring how innovation can boost delivery services. The company now plans to test how efficiently drones can deliver packages; although key questions remain over how the lightweight machines will cope with some of the bulkier packages (which will be thrown under the spotlight during this week’s War on Waste TV programme).
“In the area of logistics, we like to see models that make sense,” Kestin added. “If the positives lead to a reduction in large polluting trucks roaming the cities and replaced with a more sustainable way to deliver, then it’s going to outweigh an incumbent model.
“Obviously the jury is still out as to how these companies will use these models. If you look at companies like Uber and [restaurant delivery service] Deliveroo, then you can’t really view any sustainability contributions as they’ve just replaced the previous model.”
For Kestin, a lack of dynamism in the current market is no doubt causing some “friction”, but the fact that models mainstreamed by the likes of Nimber and AirBnB are now being adapted by larger companies will ultimately pave the way for substantial growth.
System revolutionaries: Sharing economy will destroy inactive incumbents, says @Forum4theFuture: http://t.co/RnGqKAM9iJ via @edie
— UCL GCSC (@UCL_GCSC) March 17, 2015
Kestin pointed to the growing number of holiday sites that now advertise AirBnB-listed properties, as well as the amount of Facebook pages dedicated to selling and “shipping products”, as clear proof that the demand for these types of services is there. But, in order to ramp up supply, more companies will need to venture into a market that will eventually be driven and dictated by data.
Nimber is already using the Friday Ad newspaper to spread its message, but Kestin revealed that “practically every logistics company in the UK had spoken to [Nimber] to ask for help on the delivery process”. The company is also in discussions with one of the largest UK supermarkets about potentially collaborating.
As large – and usually tech-savvy – companies now get to grips with utilising crowd logistics, Kestin foresees a future where “last-mile deliveries” are monetised as people walk or cycle around cities to deliver products. Nimber has already spoken to Google in regards to mapping, and a day could soon arise where a database of products that need to be delivered can be accessed by individuals – with gamification potentially mobilising this market quicker.
“In the future, by using data we’ll be able to know when people are going to leave their homes and where they’re going and we could take that and reach out to them,” Kestin adds. “Data is enabling us to know where you are, where you normally go and your habits. It could be that, if you can gamify this and match it then people can make money.
“Traditional models are starting to integrate data into their platform in order to seek out value. I call this the access economy – sharing can be a bit misleading – but the access economy is enabled by smartphone technology and we are able to match better with the best solutions.
“In general, if companies like Amazon and Nimber can access this capacity then you can begin to tick boxes in regards to efficiency. This will happen, it’s just a case of how fast. But 2016 or 2017 could be the year that new models takeover.”
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