Paying for convenience: Attractiveness and revenue potential of time-based delivery services

Purpose: The purpose of this paper is to investigate the potential of a new convenience-enhancing service at the interface between retailers and consumers: time-based delivery of parcels. The service allows consumers to choose a preferred time slot for a parcel to be delivered. This convenience-enhancing logistics service may be attractive for consumers, retailers, and logistics service providers. The authors provide insights on consumers' willingness to pay (WTP) for this service and important drivers of its attractiveness. Design/methodology/approach: This paper measures and analyzes the attractiveness and antecedents, the WTP, and the overall revenue potential of this service based on an empirical analysis. A contingent valuation approach was adopted to measure the WTP and the level of usage. Findings: Research results suggest that the level of availability at home and the working hours per week are important antecedents of the perceived attractiveness of the service. Furthermore, consumers who perceive this convenience-enhancing service as attractive, represent a market segment that has significant revenue potential. Research limitations/implications: Based on the analysis, important managerial insights are derived that can guide logistics service providers and retailers in their decision to implement such a novel service. Originality/value: The paper enhances the scope of convenience services, providing empirical data for a time-based delivery service.