How Drone Delivery is Transforming Retail

Let’s Talk Drones. No, not the UFOs spotted over New Jersey, but drone delivery—the kind piloted by Amazon, Walmart, and others. Are drones the future of delivery or just another shiny object? With Amazon alone investing over $2 billion into the initiative, I can’t help but wonder: do they genuinely believe this will pay off? Will faster deliveries translate to improved customer experience, satisfaction, loyalty, and retention, or are we chasing convenience over sustainability? This might be one area where Amazon is playing catch-up. Walmart claims to have the largest drone delivery footprint of any US retailer, spanning seven states and 36 stores, with over 20k deliveries in the past two years. That’s impressive, but will it really improve its bottom line? Doug Herrington, CEO of Worldwide Amazon Stores, has an optimistic outlook: "Given the AI transformation we are going through, the breadth of innovation across our teams at Amazon has never been broader. As a customer, given the evolution that we’ve gone through over the last 20 years, I’m in awe of what Amazon is going to look like with another 20 years of innovation and transformation." It’s hard not to be intrigued by what drone delivery will do for last-mile logistics. Yes, it’s undeniably cool. But as a customer, I ask myself: ❓ Do I really need my package in 30 minutes❓ ❓ Will serving rural areas drive meaningful growth❓ If there’s a payoff, it will likely hinge on these three key benefits and their impact on user experience, satisfaction, and loyalty: 1️⃣ Ultra-Fast Delivery Times - Packages in 30 minutes? That’s hard to beat. → User Experience: Instant gratification at its finest in an on-demand world. → Customer Satisfaction: Faster delivery reduces friction, keeping customers happy and engaged. → Customer Loyalty: Consistently exceeding expectations builds trust and repeat business. 2️⃣ Enhanced Accessibility - Drones can reach places traditional delivery vehicles can’t, like remote or highly congested areas. → User Experience: Greater convenience in underserved locations. → Customer Satisfaction: Reliable service where others may fall short. → Customer Loyalty: Capturing untapped markets strengthens Amazon’s foothold in these regions. 3️⃣ Environmentally Friendly Deliveries - Reduced carbon emissions by replacing gas-powered vehicles. → User Experience: Eco-conscious customers feel aligned with Amazon’s sustainability efforts. → Customer Satisfaction: Resonates with those who prioritize green practices. → Customer Loyalty: Builds emotional connections with customers who value environmental responsibility. Drone delivery can elevate customer experience by providing ultra-fast, reliable, and sustainable services. This could lead to higher satisfaction and stronger loyalty. But the big question remains: Is it worth the cost, and do customers really need it that fast? What do you think? Are #drones the future of delivery or a trend trying to find its wings? 👽 🛸

Three reasons I think drone delivery will finally scale over the next five years: 1. Amazon - wants to hit 500 million deliveries per year by drone by 2030. They recently received FAA approval for drone flights beyond visual line of sight. The initial expansion will begin in College Station, TX, where Amazon has already been piloting drone delivery. 2. Walmart - scaling its drone delivery program to 100 stores across 5 major metros in partnership with Google Wing. Customers are already using drones to get eggs, pet food, cold meds, and even ice cream delivered in minutes. Walmart is seeing real demand for these deliveries. 3. The tech is improving and the regulatory barriers are coming down. FAA rules now permit beyond visual line of sight flights. Google Wing’s newer models can carry up to 5 lbs and travel 12 miles round trip at up to 65 mph. While I don’t think drones will replace vehicles, they're likely to take a piece of the pie for fast, lightweight, time-sensitive deliveries. This space is worth paying attention to.

While you're thinking about the future, others are already delivering in minutes... FROM THE SKY ‼️ The data is impressive: ✔️Amazon Prime Air Since 2016, Amazon has invested millions in a drone service to deliver light packages in under 30 minutes. Today, they have received FAA approval to fly beyond visual line of sight and are operating delivery services in College Station, Texas, and the Phoenix metropolitan area. ✔️Aerial Delivery Startups Companies like Zipline have completed over one million commercial deliveries and flown more than 70 million autonomous miles in remote areas of Africa and are now expanding globally with commitments to deliver 250 million vaccine doses by drone over the next five years. ✔️ iFood In 2022, one of Brazil's largest technology and foodtech companies received authorization from the country's National Civil Aviation Agency to use drones for product deliveries. Result: delivery times dropped from days... to minutes. Imagine this: A flood cuts off entire communities—roads are washed out, and access to essential goods disappears. The solution? 𝗗𝗿𝗼𝗻𝗲𝘀. This isn't the end of distribution as we know it, but it is a specific solution for certain critical stages of FMCG distribution. Particularly where speed and accessibility are not optional, but vital. Obstacles still exist: -High costs -Technical limitations -Complex regulations But with each passing day, these barriers are lowered. And the opportunities multiply. Can you imagine your next purchase arriving from the sky? It might be closer than you think. ________________ Salomón Zrihen Founder & CEO at Gipsy Distributing the best brands in Mexico and LATAM