Peer-to-Peer Crowdshipping as an Omnichannel Retail Strategy

Crowdshipping, a novel practice built upon the sharing economy, has been adopted by some retailers to tackle the notorious last-mile delivery problem in urban omnichannel retail. In this work, we study the potential of P2P crowdshipping, i.e., enlisting in-store shoppers to deliver online orders in their vicinity, and its impact on the marketing-operations interface for an omnichannel retailer. Specifically, P2P crowdshipping could potentially help the retailer improve delivery efficiency, and gain an additional lever for price discrimination. When these two effects interact, we find that the favorability of crowdshipping heavily depends on product and market characteristics, as well as how shopper-deliverers are reimbursed. For necessity goods, a cost-based reimbursement scheme could lead to a win-win outcome in both the retailer’s profit and consumer surplus; for higher-end products, reimbursing deliverers a premium on top of their delivery costs would be favorable.