by Rian Whitton, ABI research for visionaries
The evolution of consumer trends towards greater use of e-commerce represents a fundamental shift in the buying and selling of goods. Even before the global pandemic accelerated the shift in consumer behavior, e-commerce revenue was expected to grow from 3.98% of global retail revenue in 2012 to 26.01% in 2025.
The long tail is both an opportunity facilitated by the rise of e-commerce and a contributing factor to its further expansion. E-tailers understand if they offer more choice, they can achieve more multi-line orders and extract value from previously untapped markets. But a major hurdle is the necessary labor to pick a wider array of SKUs.
In order to implement the long tail, e-tailers are now being required to shift the emphasis of their innovation from blanket cost reduction to greater flexibility, and to transform their supply chains into more distributed networks of fulfillment centers located close to urban areas and powered by flexible automation. In effect, it is nearly impossible to incorporate the revenue benefits of Long Tail while maintaining the efficiency and productivity levels of the traditional warehouse, fulfillment and distribution set-up.
A more transformative solution is required meaning innovation across automation, the workforce and fulfillment. Previously, such a solution was thought largely out of reach. But through research and increased funding, the first deployments of autonomous mobile manipulation robots (AMMRs) has begun in e-commerce fulfillment.