FedEx is going beyond the last mile and diving deeper into eCommerce, as on Tuesday (April 27) it announced a new partnership with Adobe Commerce. Adobe will be integrated into ShopRunner, which FedEx acquired late in 2020. According to a statement from FedEx, the integration will give Adobe merchants access to FedEx post-purchase logistics intelligence, with the intent of helping them drive demand and produce customer data.
FedEx did not detail exactly how that data would be produced and accessed. But the combination of companies supports FedEx’s foray into the elements of the digital-first economy that are adjacent to its delivery business. ShopRunner is a pre-purchase, subscription-based eCommerce platform that specializes in exclusive offers, two-day shipping, free returns and local merchant connections.
At the time of the acquisition, both FedEx and ShopRunner touted the pre-purchase and post-purchase synergies. ShopRunner got a delivery partner that could scale its business and provide data, while FedEx got an eCommerce partner that could inform its data and technology initiatives. The combination also served as an aggressive play against Amazon as it builds out its transportation fleet.
Now add Adobe to the mix, which is even more complicated (and better for merchants), with its Magento subsidiary. According to FedEx, the Adobe collaboration will “help merchants better manage their shipping and logistics and allow them to offer a great last-mile delivery experience as a way to retain customers and build loyalty. Merchants shipping with FedEx will also benefit from FedEx post-purchase logistics intelligence to help create a more efficient and reliable experience for both the merchants and their customers.”
Adobe Commerce, without Magento, brings a tremendous amount of data to the table with the Adobe Digital Economy Index, which measures consumer eCommerce spend. With Magento, which Adobe purchased in 2018, merchants who participate get a cloud-based platform that syncs with Adobe’s customer experience engine to provide what the company says is a unified view and infrastructure that can be applied to B2C or B2B companies.
“The opportunity to partner with Adobe is another step forward in the FedEx journey to create an open, collaborative eCcommerce ecosystem that will help brands and merchants deliver seamless experiences for their customers,” said Raj Subramaniam, president and chief operating officer at FedEx. “With Adobe’s leadership in customer experiences, the ShopRunner platform and our digital and logistics intelligence, we can increase the competitiveness of brands and merchants and create new possibilities in eCommerce.”
This means that FedEx is creating an end-to-end digital ecosystem. Theoretically, a merchant could build an eCommerce capability with Magento/Adobe, and use Adobe data to plan and predict inventory success. It could then access the Adobe customer experience data and advice to create strong customer relationships. The merchant could then use ShopRunner to take and fulfill orders, use FedEx to deliver the last mile and then analyze the business with FedEx post-purchase logistics data.
From FedEx’s and its allies’ points of view, the partnership is customer-centric. It sees merchants benefiting from the option to promote ShopRunner’s two-day shipping guarantee, and then it sees FedEx as the return provider. The result, from a logistics point of view, should be more loyal customers and higher customer lifetime value. ShopRunner will still play its role of enabling consumers to check out and store payment information.
“As an increasing share of all commerce shifts to online channels, brands of all sizes are facing competitive pressure to deliver engaging, relevant and frictionless commerce experiences to their customers. What’s more, customers have ever-increasing expectations when interacting with brands,” said Jordan Jewell, research manager, digital commerce and enterprise applications at IDC. “Adobe Commerce is well-suited for growing brands to differentiate on experience. The latest partnership with FedEx should assist merchants to better meet, and exceed, these lofty customer expectations by enabling more frictionless commerce.”