Best Buy Introduces AI-Powered Delivery Tracking, Signaling Shift in Retail Logistics
Best Buy is rolling out an artificial intelligence (AI)-powered delivery tracking system that promises minute-by-minute updates.
The company aims to satisfy customers who are increasingly frustrated with vague delivery windows and limited order visibility. Experts say the move comes as the eCommerce sector grapples with rising consumer expectations for delivery transparency and efficiency.
“Over 30% of global consumers are open to AI-driven order and delivery updates — showing the immense potential value of tech behind Best Buy’s new feature,” Krish Iyer, vice president of industry relations and partnerships at shipping software company ShipStation, told PYMNTS. “When customers know exactly when their package will arrive, it reduces anxiety and builds trust. This is crucial for large or high-value purchases that require someone to be present for delivery.”
Best Buy’s new system, set to roll out nationwide, uses real-time data and predictive analytics to provide customers with detailed delivery updates. “We’re using data like predicted demand and real-time traffic patterns to reduce delivery lead times, optimize our routes and ultimately provide customers with live estimated time of arrivals down to the minute,” Best Buy said in its Thursday (Aug. 15) announcement.
According to research from PYMNTS Intelligence, conducted in collaboration with Adobe, consumers, on average, abandoned their online shopping carts eight times per month when browsing brand websites.
Evolving Consumer Expectations
The retail industry has been moving toward more transparent delivery systems for several years, spurred by food and ride-sharing innovations. According to Iyer, research conducted by ShipStation found that 80% of global consumers now prefer at least four delivery updates per order, with 38% desiring daily updates that include detailed location information.
Many retailers struggle to meet these expectations. ShipStation’s research reveals that two-thirds of retailers fail to provide basic updates, like a simple “shipped” notification, Iyer told PYMNTS.
Implementing AI-powered tracking systems presents several technical challenges. According to Ed Clarke, founder of the logistics company Yojee, one potential issue is customer perception of driver routes.
“Sometimes, the driver may appear to be moving away from the customer, heading to another stop first,” he told PYMNTS. “This can unintentionally create a poor customer experience, triggering unnecessary customer service calls — even though AI has already determined that the delivery window will be met.”
Data integration across multiple systems poses another hurdle.
“Companies need to ensure the accuracy of their AI models and that the data ‘talks’ to each other between various systems in the retailer’s technology stack,” Iyer said. “The tracking data is only as good as the inputs and behaviors themselves; that is, a person fulfilling the order on time, scanning starting at the points where the order is generated and picked up.”
Hemanth Holla, senior director of supply chain at Tredence, said the potential impact of AI tracking extends beyond customer satisfaction.
“AI-powered live tracking has the potential to transform last-mile delivery in the retail sector,” Holla told PYMNTS. “By leveraging real-time data on traffic, weather and other external factors, companies like Best Buy can drastically reduce delivery lead time variability and provide near-instantaneous updates to customers.”
Holla also suggested broader implications: “In addition to enhanced customer satisfaction, this can drive supply chain efficiency through AI-led dynamic resource allocations. The technology’s impact extends beyond logistics, influencing customer behavior and purchasing decisions in both eCommerce and brick-and-mortar environments.”
Influencing Customers
The technology’s influence may reach beyond logistics, potentially affecting consumer behavior and purchasing decisions in online and physical retail environments. “It could even encourage larger purchases, especially online, as people feel more confident about planning delivery time slots,” Iyer predicted.
As Best Buy implements this new system, it joins many retailers exploring AI applications in their operations. Amazon, for instance, has been using AI for years to optimize its vast logistics network, while Walmart has implemented AI-powered inventory management systems.
Read more: Walmart and Amazon’s Retail Tug-of-War Now Focused on AI
The move also comes as the retail industry navigates post-pandemic consumer behavior shifts, ongoing supply chain disruptions and increasing competition from eCommerce giants. Innovations in delivery tracking could provide a competitive edge.
“AI-powered live tracking isn’t just a nice feature, it’ll become an expectation,” Iyer said. “Brands that embrace this tech will have a significant advantage in building customer loyalty and driving sales.”
Holla said the technology will be a force for innovation in retail.
“AI-driven live tracking represents a transformative leap forward in logistics, setting new standards for customer service and operational excellence in the retail sector,” he said.
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