Will COVID-19 quicken drone delivery’s flight to retail?

Discussion
Photo: UPS
Jun 09, 2020
Tom Ryan

In recent years, articles on drones have been filled with complaints about their noise, spying capacity and threat to planes. In the last few months, they’ve been hailed as heroes amid the pandemic.

In China and many European countries, drones have been reminding people to stay indoors and wear masks. In many more places, drones have been disinfecting public areas and buildings with a spraying capacity significantly higher than traditional methods.

Drones in China with thermal cameras have performed temperature checks so that humans can avoid the risks of conducting the tests.

Finally, drones have been speedily delivering tests and blood samples to frontline health workers. The Federal Aviation Administration (FAA) has been granting exemptions for COVID-related reasons.

Proponents believe the use of drones in emergency situations will increase the public’s awareness about the technology’s benefits and reduce anxiety about its use.

“This is the moment when the drone industry gets to show what it can do,” Miriam McNabb, editor of Dronelife, a news site, told the New York Times.

For retailers, delivery is one area gaining some traction.

In early May, CVS in a partnership with UPS began providing drone-delivered prescription medicine to Florida’s largest retirement community, The Villages.

Last October, Alphabet-owned Wing Aviation began the first-ever commercial drone delivery pilot program in Christiansburg, VA and the service now supports deliveries from a local Walgreens, FedEx and three small businesses.

Uber, which is working with McDonald’s to test drone delivery in San Diego, has said its drones will deliver three times faster than bikes or cars at roughly the same cost as regular UberEats deliveries.

Speaking to TechRepublic, Yariv Bash, CEO of FlyTrex, an Israeli-based drone delivery startup, said he believes the U.S. drone industry is “near the end of a very long regulatory process,” with COVID-19 showcasing the potential of the technology.

“Nobody’s willing to take any bit off the level of safety that we have to adhere to,” said Mr. Bash. “But from what we’re seeing in the past two months, regulators like the FAA are willing to push forward a lot faster than they did before.”

DISCUSSION QUESTIONS: Will increased activations during COVID-19 help speed up the adoption of drones for delivery and other retail purposes? What do you see helping or hindering their usage?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"No doubt the moment has come for drones and they are needed for the future of contactless delivery experiences, but they have a way to go."
"...there is no question that the pandemic has raised interest in automation throughout the supply chain."
"Given the nature of more rapid change others may fast-track trials or might we see UPS and similar organizations starting new trials?"

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19 Comments on "Will COVID-19 quicken drone delivery’s flight to retail?"


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Kai Clarke
BrainTrust

The cost of drone adoption and implementation is still very high. Perhaps it is “competitive” with Uber Eats, but it is still very expensive and not terribly reliable, especially in bad weather. Being unable to carry anything but a small, light object is a reflection of most drones’ limitations, and drone delivery cannot demonstrate a business model that holds up to even basic scrutiny. Imagine the cost of drone delivery of a simple McDonald’s meal, which cost $5. When you try to deliver it with a drone, you have to pay for the human labor cost to fly the drone, the opportunity cost to keep/maintain/charge the drone, and the cost to gather and process the drone fee (separate from the meal cost). Flying the drone to the address and back requires a tremendous amount of time and expense that cannot be recaptured.

Suresh Chaganti
BrainTrust

I haven’t seen any in action yet, but this is exciting. I am looking for a wider test and roll out. But it is a stretch to say COVID-19 would help or hurt in accelerating the adoption. On the other hand, impassable roads in winter may provide a more relevant opportunity and use case.

David Leibowitz
BrainTrust

The FAA has eased restrictions, which has certainly greased the skids. But drone operators are still in “pilot” mode. Packages are limited to about five pounds for consumer shipments and the flying distance is rather short. They also nearly all still require human eyes or hands for escort.

That CVS delivery in Florida is not as pictured in the glossy video promo reel above. Instead, packages are dropped to a central location, and then picked up by UPS van for local doorstep delivery. The Amazon Scout deliveries in Washington also require a human chaperone.

No doubt the moment has come for drones and they are needed for the future of contactless delivery experiences, but they have a way to go.

Keith Anderson
BrainTrust

I’m not sure if or how quickly air-based drones will emerge as a significant mode of package delivery, but there is no question that the pandemic has raised interest in automation throughout the supply chain.

While most arguments in favor of automation highlight long-term labor savings, there is clearly also a plausible claim related to business continuity in situations where workers can’t or won’t perform tasks for health, safety, or other reasons.

Given some of the projected impacts exponential e-commerce growth is anticipated to have on congestion, emissions, and costs, now seems like an apt time to accelerate investments in infrastructure and automation that could yield better outcomes.

Richard Hernandez
BrainTrust

I know early on there was an issue with getting permission to fly, etc. but I still see implementation as cost prohibitive. I see automated driver-less vehicles as a faster implementation of home delivery.

Lisa Goller
BrainTrust

Like many retail tech innovations, drone adoption will accelerate with COVID-19 as a catalyst for change.

This summer makes an ideal time to test drones’ effectiveness as substitutes for last-mile vehicle fleets.

That’s because factors helping drones’ usage include a second wave of COVID-19 this fall, consumer demand for speed (especially during the holiday season) and sustainability, and consistently successful tests. Consumers in remote areas may be most vocal about the need for drone delivery.

Drawbacks include high volumes of large or heavy e-commerce orders and government reluctance to hasten legislation to allow mainstream commercial use of drones.

johnnydougherty
Guest
2 months 6 days ago

This will be very interesting. The package probably would be limited to five pounds. Another thing is that drones are expensive and aren’t that reliable.

Ken Morris
BrainTrust

The pandemic is changing the e-commerce adoption rate for technologies and processes like drone deliveries, micro-fulfillment and buy online pickup at curb (BOPAC). It has taken three to five years out of the curve and post-pandemic I don’t see it returning to pre-COVID-19 levels. I still believe drones may be a little farther out in our future as dropping a package on a lawn dangling from a piece of string, as in the video, might have some challenges but it is a technology that will be hastened by our troubled times.

Neil Saunders
BrainTrust

I do see some applications for drones, but I am skeptical that this will become a mainstream technology for retail deliveries in the near term. At the fringes, the current crisis will accelerate testing and application but significant barriers remain to this becoming a significant part of the last mile solution.

Jeff Weidauer
BrainTrust

Drone delivery is a lot like checkout-free stores: an interesting technology, but not really practical for everyday use as the standard option. COVID-19 might accelerate the development, but it won’t make it more viable for the masses.

Steve Montgomery
BrainTrust

COVID-19 may have brought the conversation regarding drone delivery to the forefront again but has not changed the issues involved. Drones require someone to fly to and from a destination, have a limited delivery range and can carry limited weight. This still sounds like a great concept that needs a lot of work before it becomes viable.

Ralph Jacobson
BrainTrust

Drones will be one additional channel for delivery, and it will be accelerated due to the current crises, including the racial unrest. However, will drones take a significant percentage of deliveries anytime soon? I think not when you take into account the millions of deliveries per day across the U.S.

Oliver Guy
BrainTrust

I can absolutely see this happening. I recently described COVID-19 as an accelerant for digital transformation and change and called out three predictions for the new retail world. In here I predicted more rapid adoption of “robotics for delivery to reduce the need for person to person contact.” Here I was thinking of things like Starship in urban areas but had omitted to call out drones. The big barriers will be local air-space rules and regulations. Amazon are rumored to have done a number of trials in Cambridgeshire UK – but not yet delivering to the consumer. But given the nature of more rapid change others may fast-track trials or might we see UPS and similar organizations starting new trials?

Shep Hyken
BrainTrust

Just like the world started to use ZOOM as a regular mode of communication and connection with friends and business colleagues, the world will start to accept and embrace newer technologies, such as drones for delivery. COVID-19 pushed us three to five years into the future in using technologies that have been here, just not widely adopted.

Ananda Chakravarty
BrainTrust

Drone usage has still yet to become a proven model but for select cases, such as rapid medical delivery, it has already been approved and will be seeing more soon. UPS landed federal approvals from the FAA in late 2019 that permit drone usage at hospitals, corporate campuses and universities. This was pre-COVID-19. More importantly, UPS believes there’s a use case for drone tech, and permissions to fly beyond operator line of sight make a huge difference in its viability as another transport carrier of goods.

Many of the regulations have been stamped out. Now it’s more an issue of how well these regulations hold up under actual commercial use. Some challenges remain such as limited actual distances from warehouses or stores, weight restrictions, and managing drone failure. But like anything else, we will start seeing some retailers go beyond testing. I don’t believe that we’ll see rapid growth because of the pandemic. The use and growth of drones predates COVID-19.

Craig Sundstrom
Guest

Increased usage, whether because of the pandemic or simply coincident to it, will bring increased publicity, and all will go well … until two crash into each other or hit a bald eagle or whatever. For 99.9% of retailers, drones are a curiosity that do not now nor probably never will have any impact on their business. Indeed with the unprecedented problems facing retailers presently, one spending much time worrying about drones is either very foolish, or very lucky they’re doing so well.

The claim that drones are cost-effective with traditional (food) delivery — to the extent that I’m willing to believe it (and considering the source I’m not so sure) — says a lot more about how expensive the latter really is than anything else.

John Karolefski
BrainTrust

Sure, drones have proven to be valuable during COVID-19 and some experts are now feeling warm and fuzzy about this technology. I can see the value in drones for delivering medicine to remote areas and in emergencies. But for all these benefits, there are still issues of noise, spying capacity, threat to planes and birds, and so on.

James Tenser
BrainTrust

Drone proof-of-concepts are intriguing and the videos are fun to watch, but they remain in the pre-adoption phase. A drone powerful enough to lift my grocery order would need to be frighteningly large and loud. And the proponents don’t say much about the ratio of charging time to flying time.

For now, they are only suitable for certain specialized purposes — like emergency delivery of a critical medication in an area with high road traffic congestion. No disrespect to the folks trying to make drones commercially viable, but in this moment, they seem like a cool solution still searching for problems.

Doug Garnett
BrainTrust

There are so many practical problems standing in the way of drone delivery that I can’t see any pragmatic way they will ever be more than an oddity. They might have a clear value in certain business to business sales and delivery where protocols can be worked out for landing and delivery because they happen regularly.

I certainly can’t imagine wanting a drone in my porch or dropping a package on my driveway. Even worse, I can’t imagine having to be at home for drone delivery — that would eliminate all value of online ordering.

Is this another tech gizmo desperately searching for a reason to exist? Sure sounds like it to me. Retailers should be very cautious about the over-statements on these ideas.

wpDiscuz
Braintrust
"No doubt the moment has come for drones and they are needed for the future of contactless delivery experiences, but they have a way to go."
"...there is no question that the pandemic has raised interest in automation throughout the supply chain."
"Given the nature of more rapid change others may fast-track trials or might we see UPS and similar organizations starting new trials?"

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