Decoding the speed of Shansong Express: Shansong Express's road to digital instant delivery
2024-08-19
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The quiet advent of the digital age has brought about a strong trend of digital transformation in the intra-city instant express delivery market. Whoever can embrace digital technology better and faster will have a first-mover advantage in this new competitive landscape. In this regard, Shunfeng has built three industry-leading digital systems and established a strong barrier to high-quality development.
How is “One-to-One Express Delivery” Made?
Public information shows that Shansong is a pioneer in the instant express delivery industry, providing users with 7×24 hours one-to-one express delivery services in the same city, helping users solve various "urgent, busy, lazy, and difficult" problems. To date, Shansong's business covers 290 cities across the country, serving more than 100 million users in total. Under the delivery model of "one-to-one express delivery, specifically delivering your order", Shansong has achieved an average response time of 1 minute, door-to-door pickup in 10 minutes, and delivery to the entire city in 1 hour.
During its 10 years of development, Shunfeng has accumulated massive amounts of data, built a unique algorithm model under the "one-to-one mode", and gradually formed three digital systems: order matching system, dynamic intelligent scheduling system, and safety protection system.
The ability to respond in one minute comes from the order matching system in Shansong's three major digital systems. Different delivery items and different transportation methods of Shansong couriers will lead to different algorithms. After each Shansong order is placed, the order allocation will go through multiple big data calculations to match Shansong couriers with different characteristics for different orders.
For example, orders for electronic products such as mobile phones place more emphasis on safety. After receiving an order from a user, the Flash Express order matching system will select Flash Express couriers with high-quality service and safe delivery, rather than just deciding based on distance and speed. Cake orders require smooth driving during delivery to reduce the breakage rate. The order matching system will match suitable Flash Express couriers based on big data algorithm models, such as historical cake order volume, completion rate, number of canceled orders and evaluation.
For Shanda couriers, the order matching system makes order acceptance more efficient and accurate. On the one hand, the door-to-door and delivery time of orders matched by the system is faster, Shanda couriers have less idle time, and the efficiency of running orders is improved; on the other hand, Shanda couriers' historical order acceptance and preferences will be converted into numbers and labels through big data sedimentation. Some Shanda couriers prefer long-distance orders, some are good at delivering cakes and flowers, and some have fast delivery speeds... Through the algorithm system, Shanda couriers do not need to rush to grab orders. They can receive orders that are more suitable for their characteristics and preferences through system push, thereby improving their enthusiasm for running orders and service quality.
10-minute pickup and 1-hour delivery correspond to Shansong's unique dynamic intelligent dispatching system. Since Shansong orders are highly discrete, users can place orders anytime and anywhere, and the order distribution in each region is also different. Relying on the intelligent dispatching system, Shansong can perform cross-dispatching dispatches from a global optimal perspective, so that the best supply and demand balance is maintained between orders and Shansong couriers in each area of the city.
In fact, Shanfeng's transportation dispatch system has been upgraded twice. The transportation dispatch dimension has changed from the shortest distance to the shortest time, and now it cross-dispatches orders from the global optimal perspective. For example, in the figure above, orders A and B are generated at the same time. If the transportation capacity is dispatched based on distance, then order A will be accepted by Shanfeng courier B who is closest to the delivery. However, in this case, order B will be matched to Shanfeng courier A, resulting in lower efficiency for order B. Under the dynamic intelligent dispatch system, order A will be accepted by Shanfeng courier A, and order B will be accepted by Shanfeng courier B, ensuring that the delivery time of the two orders is relatively balanced and both can be completed with high efficiency.
At the same time, Shansong can also monitor the distribution of orders and transportation capacity in real time through heat maps. For example, when there are more orders in area A in a city but the transportation capacity is insufficient, idle Shansong couriers can check the heat map and go to the area to take orders. At the same time, the dynamic intelligent scheduling system will increase the priority of orders destined for area A, thereby dispatching transportation capacity from other relatively idle areas to this area.
In addition, Shansong has established a comprehensive security protection system during the order delivery process. On the one hand, in order to ensure the safety of the ordered items, Shansong can visualize the trajectory of the Shansong couriers and the items they carry through the app through real-time positioning, and introduce artificial intelligence systems to verify the identity of Shansong couriers through face recognition and the authenticity of the delivered items through image recognition systems; on the other hand, personal privacy data such as ID card numbers, mobile phone numbers, landline numbers, and bank account numbers are desensitized to ensure user data security.
In order to protect the privacy and security of both customers and express couriers, the calls made by express couriers through the platform are all made through virtual numbers provided by a third party. The express courier phone number seen by users is also a virtual number. After the order is completed, the user's personal information will be completely hidden, and the two parties will not have any further contact beyond delivery.
Digital upgrade consolidates the foundation for development
When Shansong first explored the one-to-one express delivery model, the company was based on a website and used offline manual phone calls to connect with transportation capacity. As an Internet company, this start seems a bit traditional, but it is also through this method that Shansong not only verified the feasibility of the business model at a lower cost, but also understood the needs of riders and users more directly, running its unique "one-to-one" express delivery model.
To this day, the experience gained in the early days of the business is still flowing in the veins of Shansong's digital development. Compared with the model of picking up orders along the way and spontaneously grabbing orders adopted by many platforms, Shansong not only focuses on the "one-to-one" model, but also prefers a model in which orders are actively dispatched based on platform algorithms, supplemented by the delivery personnel's autonomous grabbing of orders. Compared with manual grabbing of orders, Shansong's digital system can achieve fast and accurate matching of orders and efficient dispatch of transportation capacity. Therefore, the platform's active dispatch of orders can allocate orders that satisfy users and are convenient for delivery personnel to deliver, making sustainable and rapid response possible.
At the same time, compared with the group-order model that pursues extreme efficiency, Shansong reserves 10 minutes of life time for each order, so that Shansong couriers do not run red lights or speed in order to save time, thus avoiding safety hazards. At the same time, due to the characteristics of the "one-to-one" model, Shansong couriers can plan the best route for delivery, and the actual delivery time will be faster.
Digital upgrades are not easy, and Shanfeng has made considerable investments in this regard. Data shows that as of now, R&D personnel account for more than 25% of Shanfeng’s total, and R&D costs account for more than 50% of personnel costs.
In Zhu Guanjun's view, the digital system is a tool, and digital upgrading means the continuous iteration process of the order matching system and intelligent scheduling system built based on the algorithm system.
It is worth noting that the purpose of Shansong's digital development is to improve quality and efficiency, rather than to increase the burden on Shansong couriers. The results of digitalization are to improve the experience of users and to improve the delivery experience and efficiency of Shansong couriers, allowing them to earn more in the same amount of time. In the past, a Shansong couriers took orders by grabbing orders, which was inefficient and could only earn 200 yuan a day. However, intelligent dispatching has improved the efficiency of order distribution and optimized the delivery path. With the same amount of time, he can earn 300 yuan or even more.
Within the company, Shunfeng also hopes to make digitalization perceptible, knowable, and controllable. The development of digitalization can greatly improve the company's daily operational efficiency and decision-making efficiency. For example, through big data, it can more sensitively discover the problems encountered by users and Shunfeng couriers, and when problems arise, it can quickly adjust operational strategies and make strategic decisions based on data models.
Today, Shan Song's 10 years of digital development have achieved significant results and have formed a technical barrier in the industry. On the one hand, the massive data accumulated over the years has enabled Shan Song to understand immediacy and discrete needs earlier and more deeply. On the other hand, Shan Song has attached great importance to investment in security very early. As of March 2023, Shan Song has applied for and obtained nearly 100 patents, of which invention patents account for as high as 80%, such as the patent for "order allocation method, device, server and storage medium" in the intelligent scheduling system, and the patent for "a solution based on desensitization protection of real-time logistics data" in the security protection system.
At present, in the field of intra-city instant express delivery, Shansong has become synonymous with high-quality service. For C-end users, unlike the increasingly standardized group-order model, the development trend of the "one-to-one" model is becoming more and more non-standard. Therefore, Shansong can meet users' more personalized needs and provide more flexible delivery and errand services. In fact, more and more users are willing to entrust Shansong with tasks such as dog walking and helping with errands, which means that Shansong's service scenarios and boundaries for C-end users have been further expanded.
More and more B-end users are also starting to use Shansong's services. What many people don't know is that around 2015, Shansong had proactively refused to serve B-end users. This seems incomprehensible now, but at the time, with limited transportation capacity, Shansong believed that the pursuit of growth should not affect the quality of service to C-end users. But today, based on the increase in transportation capacity and the maturity of data algorithms, Shansong has the ability to serve B-end users and meet their high-end and differentiated delivery needs. For B-end users, the efficiency and service improvements brought about by the "one-to-one" model can play a positive role in enhancing the brand image. Therefore, Shansong's "circle of friends" continues to expand, and its partners include many well-known companies such as Tuhu Auto Care, SKP, and HP.
Digitalization is helping the same-city express delivery industry to be more accurate and efficient. Based on the industry's only "one-to-one express delivery" model, Shunfeng seized the opportunity to develop digitalization early on, not only gaining a leading position in the future transformation and competition full of variables, but also creating a new model for digital transformation and development for other same-city instant express delivery brands.
