Amazon Hub puts a parcel management depot in your home
Amazon hub - smarter deliveries and package collection

Amazon Hub puts a parcel management depot in your home

Receiving items from online retailers can be frustrating when you live in an apartment block. Delivery drivers invariably stop by when you’re out, or couriers leave cards saying they called, when you were sitting by the doorbell waiting. The result is that packages are often left with unknown neighbours, taken back to depot, or left in lobbies or outside doors – where they can be stolen.

Last year, the Citizens Advice Bureau published UK research findings that 28 percent of people had experienced parcels being left in unsecured locations, with the same number receiving the ‘You were out’ card when they were waiting inside. Anecdotes about targets-motivated drivers delivering the cards rather than the items are rife. Meanwhile, thefts by couriers are not unknown.

The result is that many items are lost agonisingly close to their final destination, and disputes arise because of it, with sellers claiming that records show the item was delivered. Meanwhile, signed-for and time-specific deliveries can add considerable costs to a purchase.

Taken together, these problems can be a disincentive to shopping online, and strip away the convenience and apparent cost savings of retail with a click – sometimes forcing people to take time off work to receive an important package, or traipse to their local depot. Some may be left wondering why they didn’t simply go to a shop – assuming, of course, that the items were even available locally.

Amazon Hub

Understandably, this has had a knock-on effect for the big beast of online retail, Amazon: unhappy customers complain and replacement items have to be dispatched. A poor delivery experience reflects badly on any retailer.

One of the retail giant’s solutions has been Amazon Hub, a package management system that stores items safely to provide peace of mind and convenience to customers.

Essentially a set of smart lockers, Amazon’s Hub system has been in action for almost a year in the US. The solution is currently used by 500,000 people who live in buildings managed or owned by AvalonBay, Fairfield Residential, Pinnacle, JP Morgan Asset Management, WinnResidential, and Equity Residential.

Unlike the Amazon lockers you might see at rail stations or convenience stores, Hub accepts packages from any sender and offers collections around the clock. It’s designed specifically for multiple-unit accommodation.

JP Morgan funds Amazon Hub expansion

JP Morgan Asset Management has announced that it will be funding Amazon Hub in 85 new multi-tenant properties, totalling over 23,000 apartments. The installation process is expected to continue throughout 2018.

“JP Morgan is excited to utilise innovative technology like the Hub by Amazon to enhance the resident lifestyle and experience in our communities,” said JP Morgan’s Brett Kahn, executive director and national multi-family sector specialist.

“Our tenants will enjoy convenient access to their deliveries, day or night, regardless of the sender or carrier. And the Hub will free up community staff to provide higher value-add services to the property and resident base.”

Amazon Hub reflects changing expectations

Bobby Shome, global business development director at delivery management company Centiro, believes the Amazon Hub rollout represents a major step in bringing convenience to customers.

“Once again, Amazon is broadening its delivery offerings to reflect the changing lifestyles and expectations of customers,” he said.

“Missed deliveries or inflexible delivery windows continue to be a major bugbear for many customers. However, the Amazon Hub means that for those living in apartment blocks, the days of customers missing deliveries or having to wait inside for a collection could become a thing of the past.”

Shome also suggests that the move will help the American market match standards set in Europe. “Ultimately, Amazon is upping the level of convenience in the US by placing these Hubs inside apartment buildings; this will help the US catch up with the European market, where pick-up drop-off (PUDO) networks are more common.

“It plays an important part in Amazon’s wider strategy to give consumers more flexibility and bring the handover point even closer to their door.”

Internet of Business says

One of the challenges of the increasingly mixed worlds of shopping and delivery is to maintain convenience and low friction at every point in the chain. If delivery experiences are consistently poor or expensive, customers may feel they gain little by shopping online, especially in big towns or cities.

Meanwhile, the promised future of autonomous, robot, or drone deliveries may bring convenience to remote or rural communities, while introducing new problems for city dwellers, who may find they have to go out into the street to receive a parcel: not easy if they are elderly, disabled, live on the top floor of an apartment block, or the weather is atrocious.

The Hub concept is a clever one, therefore – if a difficult solution to scale in a complex property market. Conceivably, a Hub might add value to a building or apartment in the same way that super-fast broadband can – and it’s clear from comments by JP Morgan that landlords see it in that way. But it is difficult to see how it could scale beyond partnerships with large property companies that can back the rollout programme with investment of their own.

However, it’s conceivable that Amazon might pursue smaller-scale versions of the Hub for regular or loyal customers, should results show that the programme is minimising its own losses and costs: a Prime add-on? Don’t bet against it.

Clearly, the presence of a Hub in a building may – like Alexa-powered devices – also be an incentive towards brand loyalty.

Meanwhile, it can’t be long before Amazon gets into the property management market itself, as a logical extension of its smart home and security businesses.

Additional reporting: Chris Middleton.