People hate shipping fees
Why do the very big online stores offer free shipping? Because shoppers hate paying for it.
“People don't just hate paying for shipping, they hate it to literally an irrational degree. We know this because our first attempt to address [at Amazon] this was to show, in the shopping cart and checkout process, that even after paying shipping, customers were saving money over driving to their local bookstore to buy a book because, at the time, most Amazon customers did not have to pay sales tax. That wasn't even factoring in the cost of getting to the store, the depreciation costs on the car, and the value of their time. People didn't care about this rational math.”
💥 Why this matters: Amazon’s willingness to try many experiments and risk failures led to better outcomes.
“In a 2018 survey by Internet Retailer, shipping charges were cited as the most common reason shoppers abandon their carts, topping the pet-peeve list for nearly a third of respondents, ahead of things like not wanting to create an account and being unsure of the store’s return policy.”
Expectation, simplicity, uncertainty, perception of value all play a part in why people dislike paying for shipping (some reading: here, here, here, here). But it seems to boil down to this: shoppers feel like they’re being asked to pay a second time (for the shipping) to get a product they’re already paying for (the shopping). Partly, we’ve been trained to think like that because dotcom startups in the late 1990s tried it out. Later Amazon perfected it, by moving the shipping cost to a single annual fee - Prime - which you only signed up for after you were already buying loads of books and DVDs from them.
Society has worked hard to make things efficient and to hide all of the complexities away. You don’t need to know where that cheap t-shirt was made or how it got to you. Obviously shipping isn’t actually free, but when something is practically invisible, perhaps that reinforces the feeling that it *should* be free.
(And there are some obvious problems with free shipping: swallowing that cost if you’re a retailer is difficult if your industry already runs on tight margins. And it’s harder for smaller retailers to offer free shipping, because the economics of shipping mean that retailers with volume will pay less to ship each package.)
However maybe people are happier to pay delivery fees if that delivery is *immediate*. It’s clearer to see the value: you buy it and it comes to you now. Related, some Co-op news: Co-op hits major milestone with 400 stores on Deliveroo.
Drone insurance: the AI is a pilot
“The companies explained that what makes the work with Flock particularly unique is that the company’s AI technology has been classified as a pilot. This means as the edge-computer gains more in-flight experience and learns how to increase safety standards, the cost of insuring the system will reduce.”
Will the insurer measure improvement in learning from recorded flight/driving outcomes? Or will it inspect the AI’s data and code?
💥 Why this matters: You could also see this model working in self-driving cars, and the insurance contract moving from the driver to the vehicle manufacturer.
Uber and working conditions in the gig economy
Uber and Lyft were told by a California court to treat drivers as employees, which would give employee protections to drivers. But Uber is very sad about this and says drivers want flexibility alongside their protections, and proposes “benefits funds” for drivers instead.
💥 Why this matters: Better working conditions and contractual protections are A Good Thing. It’s gradually getting harder for Big Tech companies to claim they’re mere information intermediaries.
Elsewhere, Just Eat will switch from gig economy workers to employees. “We want to be certain they do have benefits, that we do pay taxes on those workers."
Climate change: food and energy security
A tornado flattened a *lot* of Iowa’s corn, which means a lot of America’s corn. Extreme and unpredictable weather is increasingly affecting food security. (And safety, eg wild fires in California.) Extreme heat is profoundly unequal.
BP shows oil majors how to green a polluting company - this actually sounds like a big step in the right direction. The really big step would be an oilco entirely divesting itself of carbon-intensive businesses, as Ørsted (Denmark) did. On the other hand, Chevron is installing solar panels - to produce oil more cheaply - sigh.
Numbers from a survey of 2,000 UK adults:
- Effects of the pandemic: 81% say sustainability and the environment is now more important to them, and 72% say their local community is now more important to them
- people are willing to pay 12% more for sustainable goods and services if it helps the planet
The sustainable.dev - “resources that enable you to craft a greener, more sustainable web”.
Debenhams will cut another 2,500 jobs, and hires a liquidator just in case.
Amazon may take over old JCPenney and Sears department stores to try and speed up deliveries - they’ll be repurposed as local fulfillment centres.
“After a lot of conversations, we decided to go ahead with Prime Day. Life has to go on. Sellers have to get back on their feet.” - Akshay Sahi, head of Prime at Amazon India.
“The majority of all US tests are completely garbage, wasted.” - Bill Gates being interestingly spiky in an interview on Covid.
“Britain, I was told, has found a way to be simultaneously overcentralized and weak at its center” - a US take on Britain’s response to the virus.
“in some ways, long-lived personal data is even worse than nuclear waste. While the data itself may live, the context which makes the data understandable and useful decays much more quickly because it likely  has not been collected” - Dan Hon.
“Our bots generate around 5,000 data points 1,000 times per second - that’s a GB of data per bot, per day, or a total of 4 terabytes daily for a swarm within one highly automated warehouse” - Ocado.
Co-op Digital news and events
Co-op hits major milestone with 400 stores on Deliveroo:
“Deliveroo customers can now order from 400 Co-op stores serving towns and cities with a combined population of 27 million people across the UK [...] The average delivery is 1.7km away from the store”
Asynchronous meetings - by Co-op Digital’s Iain Mitchell. How to save time and cognitive load by replacing endless video meetings with “asynchronous meetings” in Slack or Microsoft Teams.
Other free of charge events:
Paid for events:
More detail on Federation House’s events. You can also see how The Federation is planning for a safe return to the co-working floor.
Thank you for reading
Thank you, beloved readers and contributors. Please continue to send ideas, questions, corrections, improvements, etc to @rod on Twitter. If you have enjoyed reading, please tell a friend! If you want to find out more about Co-op Digital, follow us @CoopDigital on Twitter and read the Co-op Digital Blog. Previous newsletters.