Utilizing Artificial Intelligence for Improved eCommerce Package/Parcel Tracking

Introduction

Parcel tracking is one of the most crucial and challenging processes for retailers because a LOT depends on it. Customer Retention Rates (CRR), Net Promoter Score (NPS), Customer Lifetime Value (CLV), and the ultimate profitability of a business are directly related to efficient package tracking.

Until very recently, retailers used barcodes, RFID tags, GPS, Electronic Data Interchange (EDI), and scanners to track shipments. While these methods are cost-effective, they do not guarantee 100% accuracy.

As competition rises in the ecommerce industry, speed and precision in shipment tracking become a key determinant of customer loyalty.

AI’s advanced algorithms and automation present a more reliable packaging tracking system, leaving no room for error.

As retailers strive to provide the best customer experience, they look to AI for improved package tracking solutions.

This article starts off with a detailed discussion of how artificial intelligence is proving beneficial in shipment tracking. We end this post by highlighting some unseen advantages of using AI for overall business efficiency.

4 Ways in Which AI is Revolutionizing Ecommerce Parcel Tracking

AI has penetrated the very core processes of e-commerce logistics but nowhere can it be seen as clearly as in eCommerce package tracking. Let’s see how retailers stand to benefit from AI’s inclusion in live track and trace.

1) Real-Time Shipment Notifications

The biggest advantage of utilizing artificial intelligence in ecommerce package tracking can perhaps be seen in its ability to deliver real-time notifications to customers.

Intelligent shipping software using advanced AI and ML algorithms can relay live order status information to customers with next to no downtime.

Moreover, its use of blockchain technology allows AI to analyze scores of historic shipping data to correctly estimate delivery times for every carrier.

While real-time tracking notifications increase customer satisfaction and trust, they also enable businesses to deal with disruptions and delays faster than ever before.

With AI-driven tools, retailers can automate parcel tracking notifications at crucial milestones like ‘Order confirmed’, ‘Shipped’, ‘Out for delivery’, and more.

2) Route optimization

AI’s use in route optimization can be a deciding factor in streamlining last-mile delivery operations.

Apart from the aforementioned analysis of historic shipping data, AI can also determine the fastest delivery routes, steer clear of traffic, and foresee weather conditions based on previous forecasts.

It can also prompt drivers about the nearest fuel stations for a quick fuel-up. In this way, it reduces the cost of transporting goods from one place to another while offering time-definite deliveries.

It also gives more power to retailers to circumvent unforeseen obstacles in the delivery route with actionable insights.

3) Load optimization

Load optimization can be understood as utilizing a delivery vehicle’s capacity to the maximum to reduce the number of trips required.

While it sounds simple in principle, the problem arises with arranging the various types and sizes of e-commerce shipments.

Not to mention goods with special delivery instructions and the order in which they will be delivered.

AI’s contribution to load planning is significant. It can map out the optimal loading structure for any delivery fleet based on the number and type of items to be shipped.

AI-based load optimization also considers the estimated delivery dates (EDD) and address of every package to ensure products are delivered on time and with maximum efficiency.

4) Personalized tracking

With customer retention becoming the buzzword in ecommerce, retailers are now focusing on creating personalized customer experiences in the after-sales phase.

AI allows brands to curate a customer-centric tracking process by assessing shoppers’ likes and dislikes based on buying behavior, reviews, and feedback.

An AI-integrated branded tracking page can display every customer’s ‘wish list’ items, or products they are most likely to buy.

Not only does this translate into added revenue for the business, but it also shows the customer how much the brand values them.

Moreover, artificial intelligence can also predict the preferred delivery times of frequent buyers, which makes for an excellent post-purchase customer experience.

AI’s use in personalized tracking, therefore, makes an otherwise mundane process into one that instills loyalty and trust.

The Hidden Influence of AI in Online Package Tracking

In the section above, we discussed the ways in which artificial intelligence directly affects parcel tracking.

However, needless to say, every aspect of ecommerce logistics has and can benefit from the adoption of AI tools.

The points discussed below may not directly influence order tracking, but they have an overarching effect on operational efficiency, customer satisfaction, and responsible shipping.

1) Estimated Delivery Dates

AI’s role in improving estimated delivery date (EDD) prediction is unparalleled because it can make dynamic shifts to incorporate new information.

Our present systems only allow a near-accurate delivery date; however, software using AI and ML algorithms can estimate delivery dates with remarkable precision.

This is because these systems take into account past carrier performance, delivery location distance, seasonal variations, weather patterns, and more to recalibrate EDDs according to new circumstances.

This creates transparency in the package tracking process and helps customers manage their expectations. It also allows businesses to spot delays faster and rework their SLAs with carriers if needed.

2) Fleet Management

Currently, shipping carriers appoint fleet managers to monitor delivery fleets. This involves the maintenance of vehicles, asset management, scheduling, and dispatching for the most cost-effective results.

AI can significantly reduce workforce requirements for fleet management and thereby cut down heavily on expenses.

It automatically schedules fleet maintenance visits, identifies faulty parts, and lines up loading/unloading, and dispatch workflows.

Further advancement in AI technology is guaranteed to make robotic or driverless deliveries more common in the ecommerce space, thereby saving costs and reducing overall carbon footprint.

3) Theft and Fraud Prevention

Fraudulent activities resulted in a whopping USD 48 billion loss in 2023 alone. The most common of these was ‘chargeback’ abuse, also known as ‘friendly fraud’ where a customer makes the transaction only to raise a dispute later with their banks or merchants resulting in a chargeback.

Other organized thefts carried out by cybercriminals, like identity theft, account takeover, and triangulation fraud, regularly cause merchants distress and huge losses.

AI tools with machine learning abilities can detect deceitful activities by scrutinizing behavioral patterns and search history to determine suspicious transactions. This allows ecommerce retailers to mitigate risks and strengthen their security protocols.

4) Inventory Balancing

To successfully fulfill every order, retailers must keep a balanced inventory that’s neither surplus nor out of stock.

Inventory balancing is a tricky process that requires transparency and real-time data transfers across all online and physical storefronts.

AI allows businesses to correctly forecast demand ahead of the sales season based on shopper behavior, including the number of articles likely to be sold in each category.

This insight can greatly help entrepreneurs plan their inventory to reduce dead stock while always keeping their stock levels replenished.

Artificial intelligence’s use in unified commerce or omnichannel fulfillment is especially noteworthy because of its ability to process and store data in real time.

5) Fake Deliveries

Fake deliveries are a common occurrence in the ecommerce world, where a shipping carrier or delivery agent marks an undelivered package as delivered.

This phenomenon is especially common with curbside or doorstep deliveries, which don’t require any proof of delivery (POD) to be considered fulfilled.

The only way to resolve such issues is by quickly gathering customer feedback by triggering notifications as soon as the package is marked ‘delivered’.

AI tools can hasten this process and collect data so brands can identify the frequency of fake deliveries with a particular carrier.

It can also track the delivery agent’s behavior, map their delivery route, and notify businesses about any deviations or delays.

Is AI the Future of Ecommerce Parcel Tracking?

In an industry like ecommerce logistics, where innovations happen regularly and things move fast, it’s hard to say what the future will look like.

However, it would be gravely unjust to downplay artificial intelligence’s immense contributions to the field and its potential to revamp it.

Many shipping software, like ClickPost, are already using intelligent solutions to power package tracking for maximized accuracy and speed. The end goal for businesses now is to enhance customer satisfaction and post-purchase journeys.

AI-related processes like blockchain, augmented reality (AR), and IoT (Internet of Things) are changing the face of ecommerce as we speak.

To better understand the ways in which artificial intelligence can aid eCommerce retailers, we at ClickPost will be attending NRF 2024: Retail’s Big Show. Meet us there!

Conclusion

We’ve seen the many ways in which utilizing AI can improve package and parcel tracking but this is only the beginning.

With its deep learning and constantly evolving nature, AI and ML together can completely change the way people shop online.

Some of the most likely predictions are - smarter stores, better customer experience, targeted marketing, better inventory management, and dynamic pricing. We don’t know what the future holds for eCommerce but it will be worth waiting for.