Online shoppers are sealing the future of air cargo

In 2016, one seventh of the world’s population – a staggering 1.6 billion people – shopped online.

By the time we reach 2021, this number is expected to reach around 2.1 billion.

Driven by convenience and falling delivery charges, time-poor shoppers are choosing online retailers over bricks and mortar shops, with more than half of consumers exercising their purchasing power online.

Millennials are an integral cog in the machine – their tech-savviness and disposable income supply brands with the cash and incentive they need to grow and streamline their delivery chains, which in turn, fuels demand for cargo space. This trend shows no signs of slowing down… online shoppers are here to stay.

Here are four ways e-commerce is making its mark on the world of air cargo.

  1. Online purchases sent overseas are increasing each year
    A study by Accenture and Alibaba’s research arm AliResearch showed that the value of online shopping sent overseas jumped by 30 per cent in the past year to a total US$400 billion. This number is expected to grow to over US$1 trillion by 2020, with much of the cargo travelling by air.
  2. Shippers are creating their own logistics arms
    Amazon plans to open a US$1.5 billion cargo hub at Cincinnati/Northern Kentucky airport to meet demands for greater speed and responsiveness. With 2,000 people on the books, the 900-acre facility will house 40 of the e-commerce giant’s Prime Air planes in Hebron, Kentucky.
  3. Cargo providers are embracing digital
    In 2016, Alibaba joined forces with Maersk to create a service that would let shippers book container space via the Chinese company’s One Touch booking website. Maersk said that the move was part of the company’s efforts to go digital, with plans to launch more online third-party services.
  4. Supermarkets raise their online game
    Following Amazon’s US$13.7 billion takeover of Whole Foods earlier this year, Wal-Mart has raised the price of food and household items on its US website in an effort to increase footfall in-store and compete with the online giant. This is one of a few punches being swung by the American supermarket, which plans to increase its drive-in grocery delivery service to operate at 1,100 stores by the end of 2017.

IAG Cargo transports e-commerce shipments to more than 350 destinations in our Prioritise, Airmail and General Cargo products.