This product development plan was created as part of the New Product Innovation course during my MBA.
Your packages secured by the people you trust.
For consumers who enjoy the convenience of shopping online but have concerns about the safety of their package, AtEase is a network of certified neighbors who will receive and secure your package in-person until you are available to pick it up or have it delivered to you. Unlike package lockboxes and drop-offs by parcel couriers, AtEase guarantees that your packages are always in trusted hands and close to your residence. By keeping packages off the porch and close to home, you can confidently shop online with a peace of mind.
One-click Delivery Address
Instead of delivering a package to your home or business address when you’re shopping online, you can pick AtEase at checkout. AtEase offers a convenient plug-in that’s available on all web browsers. With just one click at checkout, AtEase automatically finds the most convenient neighborhood receiver in your area to receive your package.
Once your package is delivered to the neighborhood receiver, you’ll receive an e-mail notification or in-app update on the status and state of your package.
Scheduled Pick-up or Delivery
At your convenience, you can schedule a time block with the neighborhood receiver to pick-up your package or have it delivered to your residence at an additional cost.
Any package that is ordered through AtEase will have its tracking information added to your account so that you can conveniently see all of your incoming items at a glance no matter from how many different places you shop.
Ratings and Reviews
Users of the platform can rate and review package receivers to promote positive behavior and safety.
For a full list of features, including their functions and benefits, see the Feature-Function-Benefit framework in the end.
With the e-commerce market expected to grow an additional $2.3B in the next three years (Clement, 2020) within the United States, the frequency and quantity of packages that an average end-consumer will receive is also expected to rise. The negative side effect of this growing online marketplace is the outdated and insecure delivery service which has resulted in an increase in package theft.
The unreliability of package delivery is a growing concern. We performed a VOC survey on 27 online shoppers (see Exhibit 3A) in which 70% of all survey respondents reported that their biggest concern with package delivery is the package sitting idly outside their house at risk of theft. When the survey respondents were asked to choose a value between 1 to 5 to indicate how concerned they were about package theft, with 1 being not concerned and 5 being very concerned, 40.7% of all respondents reported a 5. These results are further confirmed by both a C+R Research survey that stated 36% of Americans had at least 1 package stolen in the past 12 months (C+R Research), and a survey performed by the Shorr Packaging Company that stated 54% of 1,052 online shoppers “changed their plans to be available to receive the package in-person” (Shorr, 2019) (see Exhibit 3B for more details).
After finishing the check-out process and before the package is delivered.
41% of people receive 3-5 packages per month. 37% receive 1-2 packages per month.
Packages are dropped off in front of the house at unscheduled times.
Deliver packages to secondary addresses (lockers, friend's address, family's house, work), or keep them at the carrier's access points to pick them up later or reschedule delivery to another day.
Busy professionals living in suburban neighborhoods of major metropolitan areas, who receive 5-20 packages per month.
Frustration, fear, annoyance.
Average cost to replace a stolen item is $109. Average amount spent to prevent package theft is $191. Carrier access points are at least within 5 miles of each residence.
Secondary addresses can be inconvenient to find or access.
Available delivery times may not coincide with the consumer's availability.
Problem statement canvas
Currently, the majority of package theft solutions are centered around passive end-consumer actions. Popular solutions used today are rescheduling delivery to ensure in-person acceptance (Shorr, 2019), delivering to an alternative address (Shorr, 2019), and purchasing a security deterrent such as a Ring doorbell or Arlo Security camera (C+R Research). Based on these current solutions, we compiled a list of products that consumers are currently using. See Exhibit 6 for a full breakdown.
In our VOC, we questioned the survey respondents on the drawbacks of these current solutions. 32% of respondents reported that delivering their packages to an alternative address is inconvenient because of distance traveled and lost time. 11% found that security systems are unreliable due to connectivity issues and poor video footage. 5% stated that security systems are costly. This demonstrates the market opportunity to provide a solution that is not only secure and convenient but also low-cost.
Total addressable market
Consumers that shop online...
265.5M online shoppers
Serviceable available market
...and are fearful of their packages being stolen when shopping online...
143.4M online shoppers
54% of online shoppers are fearful of packages being stolen when making online purchases.
Service obtainable market
...and live within suburban neighborhoods of major metropolitan areas...
91.8M online shoppers
64% of households in metropolitan areas live in suburban neighborhoods.
From our research, we found the package-theft-prevention market to be dominated by package delivery companies, outdoor security systems, and parcel lockers. See Exhibit 9 for a perceptual map evaluating the competition based on cost and convenience.
Package Delivery Companies
In the survey conducted by Shorr, 45% of survey respondents schedule their delivery. In other words, the consumer was not available to accept the package at the original delivery time and requested that the delivery company deliver the package again at another time when they are available. The major players in this space are package delivery companies like UPS, Fedex, USPS, and Amazon, all of whom offer the ability to reschedule deliveries to other days.
Home Security Systems
33% of survey respondents purchased home security systems. In the home security systems space, the companies sell and distribute a variety of indoor and outdoor security applications, such as smart locks, motion detectors, and doorbell cameras. The major players in this space include Ring by Amazon, Arlo, and Nest by Google. Home security systems are generally expensive, costing $100 to $250 upfront and $15 to $35 per month for professional monitoring, live camera footage, and cloud storage (Starr, 2020). Although home security systems deter porch pirates, 12% of survey respondents in our VOC reported that security cameras are unreliable due to poor footage quality and connectivity issues.
19% of survey respondents utilize package lockboxes (Shorr, 2019). Package lockboxes are self-service lockers, which includes cluster boxes and kiosks. The major players in this space include GO Locker, Parcel Pending, and Amazon Hub, and it also includes package delivery companies with local access points such as UPS, Fedex, and USPS. Package lockboxes are generally located in communities, apartments, and retail spaces, and are limited in the size of packages that it can receive.
Unlike our competitors, AtEase keeps a high level of security and convenience while maintaining a relatively low price to use. It does this by being the only solution that proactively protects packages by putting them in the hands of a certified neighbor until it reaches its final destination. It also is the only proactive security solution that guarantees closeness in proximity to the end consumer’s address.
Critical Success Factors
For AtEase to be successful, it must provide substantially more value than existing offerings and competitor moves. To achieve this, the service must be as convenient as possible while minimizing costs to consumers. One of the primary critical success factors is network density. Because AtEase is a localized solution for consumers, there must be a high density of certified receivers (1 receiver per mile radius based on focus group feedback) to offer a high enough level of convenience for people to use. There must also be enough end consumers using the program to incentivize receivers and achieve network balance.
Another critical success factor is bringing the service to the consumers at a very low cost. Despite AtEase’s value proposition, the willingness for consumers to pay the neighborhood receiver is not likely due to other low cost, and sometimes free, alternatives, such as UPS’s rescheduling service. The neighborhood receivers have to be paid, and as a result the unit economics would not work in our favor.
In order for our business model to work, the costs need to be subsidized by retailers and package delivery companies. According to a 2015 report published by the NRF, merchandise returns accounted for over $260.5 billion in lost sales for US retailers in 2015. Because our service guarantees that packages are always received by someone, we could strategically partner with retailers to help them drive down costs associated with returns and lost merchandise.
The last critical success factor is to execute on the current business plan in a way that minimizes risk of liability to AtEase. AtEase must properly structure the company in a way that avoids AtEase becoming the point of blame for any and all package disputes. As a last mile delivery service, AtEase is the last point of contact for consumers, which puts it at risk of backlash regardless of the true cause of any problems with the package.
If AtEase can achieve a critical mass and density in the network, strong partnerships, and proper positioning in the customer’s minds, it will find success in the market.
We conducted 5 focus group sessions with 2 to 4 participants each, using a landing page mock-up to explain the what, how, and why of the product.
Through the focus group we were able to gather valuable insight about potential use cases, comfortable price points, and anticipated challenges in deployment. Here are the key takeaways:
- Like all other gig economies, building trust on the platform is very important. Consumers needs to be able to rate their receivers. Receivers should also pass strict background checks.
- Proximity is a critical success factor for convenience. Location of the package should be within one mile of the consumer’s residence to be deemed convenient for pick-up or delivery.
- Work with community organizations such as the Homeowners Association to introduce the program into neighborhoods in a structured and safe manner.
- Power users prefer a subscription model.
- The value that AtEase offers is marginal compared to what the focus groups currently do. They stated that it’s not that inconvenient to ask UPS to reschedule the delivery to another time when they’re available. They also stated that it’s extremely painless to get a refund or replacement for a lost package from the retailer at no additional cost.
- Because AtEase is a last mile service provider, customer service will be crucial in overseeing disputes, damages, and losses associated with the package.
- Unless the AtEase platform handles the entire last mile delivery process, it would be a hassle to track the packages from UPS and then to AtEase. AtEase should be the only source of information after the merchandise has been purchased online from the retailer.
|Goal||To disrupt the package delivery industry and increase net profit for SMB suffering from package theft loss|
|Specific||AtEase should enter the package delivery market and begin gaining market share within the first two quarters of launch. During the first two quarters, AtEase will onboard consumers and retailers with the Shopify plug-in.|
|Measurable||For retailers, we'll track the number of new storefronts using the Shopify plugin. Success is measured by the ranking within the plugin store, and within the first 2 quarters post-launch the target ranking should be the top 100 plugins to include in a storefront. For consumers, we'll track the number of shoppers using AtEase as a delivery option via the Shopify plug-in. Success is measured by conversion and monthly active u rate. Within the first 2 quarters post-launch, AtEase should see a 25-30% conversion rate.|
|Attainable||Currently, the chance of achieving this goal are 50%. In order to attain this goal, sales and marketing will need to focus on educating the features of the service and onboard retailers and shoppers. To increase the odds of achievement, focusing on advocate and influencer marketing will help generate more solid leads compared to programmatic marketing.|
|Relevant||This goal is of utmost importance as the ecommerce market is growing at an exponential rate. With any success gained, the risk of competitive retaliation grows. Gaining market share and brand recognition will be key to the success and long-term survival of the company. By gaining brand recognition with vendors and end-consumers, AtEase will be able to begin seeking partnerships with key players in the supply chain such as delivery companies and fulfillment centers.|
|Time-bound||This goal should be attained within the first 2 quarters of launch.|
Communciations and Messaging Strategy
|Public Relations||AtEase will utilize press releases as authentic news stories that convey AtEase’s service as the new must have in the e-commerce delivery space. See the exhibits for our press media kit.|
|Analyst Relations||As AtEase grows traction, the company will share any customer data needed for analysts such as Forrester, Gartner, and SalesForce. This will increase brand reputation on the B2C side for potential vendors.|
|Programmatic Marketing||AtEase will use traditional programmatic marketing to direct traffic to the company website for education of the services provided. The materials used overlaps with the material used for public relations (see exhibits for product collateral).|
|Partnership Marketing||Though the e-commerce industry is exponentially growing, the reputable platforms used to create storefronts by SMBs is only a handful. By forming partnerships with these e-commerce platforms, AtEase will increase brand recognition and trust.|
|Advocate Marketing||As AtEase builds traction, AtEase will implement a referral program that incentivizes returning customers to bring new customers to the platform. When new customers complete the sales funnel for the first time, the referral customer will be monetarily rewarded.|
|Influencer Marketing||AtEase will contract out social media influencers who are millennial homeowners that fit our persona types and are existing AtEase customers. Specifically, we will focus on YouTube, Facebook, Twitter, TikTok, and Instagram.|
AtEase faces stiff competition from package delivery incumbents, such as UPS, Fedex, and USPS, all of whom offer scheduling services and closer access points to store your packages at free or very low price points. Our focus group testers have indicated that the benefits we offer over these existing services is marginal. In order to generate buy-in from consumers, AtEase will need to position itself as the most convenient and secure last-mile package delivery service provider.
Cost to reach critical mass
AtEase has a business model that depends on network effects to reach critical mass. Without scale, AtEase is at a risk of burning more cash than it can generate to sustain expansion and pay its neighborhood receivers. In order to reach high scale growth, AtEase will spend significantly on marketing and will subsidize retailers and package delivery companies.
Although not discussed in this plan, retailers will be a key part of this multi-sided equation. By reducing package theft, AtEase will save retailers billions of dollars in returns and lost merchandise. The majority of AtEase’s revenue will come from the retailers—the B2B side of the platform.
Liabilities of receiving and delivering goods by contractors
Although AtEase provides online training and guidelines for users signing up to become receivers and delivery drivers of packages, there are potential risks of bodily injury, property damage, and package loss. AtEase offers insurance that covers up to $1,000,000 in injury or damage to the contractors and to the packages.
Privacy & Security
Although we put measures in place to address the security of AtEase users and neighborhood receivers, there are risks. Our focus group testers have addressed concerns about a stranger handling and delivering their packages, especially when the destination involves their residence. To address these concerns, AtEase implements call lines, location tracking for package delivery drivers, and public ratings and reviews to make sure all users can make the safest decisions..
|Verification process for new users||Users that sign up must be verified before they can use the platform. Verification includes checking the user’s ID, criminal history, and location.||Creates trust between consumers and receivers.|
|Ratings and reviews||Consumers and receivers can rate and review each other after a transaction is made.Ratings and reviews are public to all users on the platform.||Ensures accountability and positive behavior.|
|Receiver protection insurance||Primary liability coverage for up to $1,000,000 USD per occurrence in the event of a third-party claim of bodily injury or property damage related to holding a package for AtEase.||Being a receiver can be dangerous, making them prime targets for burglary. The receiver protection insurance offers an ease of mind for receivers.|
|Real-time notifications||Updates includes time received, picture of package, damage status, when it’s available to be picked up or delivered.|
|Optimized access points||Based on the consumer’s residence and available time slots, AtEase calculates the most optimal access points for the consumer’s package to be delivered to.||Ensures that the consumer can get their package from an access point that is most convenient for them. Calculates the most efficient route for receivers to transport as many packages as possible in the shortest amount of time.|
|Location tracking||When a package is scheduled to be picked up or delivered, location tracking is enabled on both the consumer and the neighborhood receiver.||Provides consumers a sense of security because we can safely track both parties and make sure that the package is delivered at the predetermined place and time.|
- Crowdsource package security rather than leaving packages sitting unattended
- Low cost compared to other alternatives like security systems
- More convenient compared to other alternatives like Amazon Hub which still requires you to drive to a store
- High barrier of entry: few players with large networks and high level of trust needed from end consumer
- Need vendors, receivers, and end-consumers to equally participate in this platform
- Targeting suburban areas surrounding metropolitan areas is a geographical location not yet heavily targeted
- Requires network effects to scale
- Easy imitation by key players in the industry
Product Market Fit Canvas
|PRODUCT OR SERVICE:
Characteristics and jobs to be done:
Problems and needs:
Value for the channel:
|Average distance between residences and neighborhood receivers||The shorter the distance, the better. Consumers want to be able to travel as little as possible from their residence to the access point.|
|Density||Average # of deliveries per hour from neighbor receivers|
|Average number of packages received by neighbors per hour/day from package receivers||This will be important for optimizing which access points receive packages. Our service will tell package receivers which neighborhood location to deliver packages to.|
|Cost savings for package receivers using our service||Our service helps package receivers increase density (more packages delivered in less locations per hour).|
|Average access point utilization||For each access point, how much of the available capacity is used.|
|Turnaround per day||How many packages on average do neighbor receivers see come in and out each day.|
|Value per package||Our hypothesis is that consumers are more likely to use our service if the value of the package is high.|
|Conversion rate||What percentage of check-outs resulted in the consumer choosing our service.|
Connect on Twitter @KennethLNg