Jumia co-op with Zipline may succeed with drone deliveries where Amazon and DHL failed

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Key takeaways:

  • Jumia has partnered with American robotics and logistics company Zipline to deliver daily-use items with drones.
  • Other eCommerce companies like Amazon have made failed attempts to deliver drone packages. However, Zipline has had a successful track record in Rwanda, delivering healthcare packages. Will it work with everyday products?
  • Jumia and Zipline have already recorded successful tests in Zipline’s operational hub in Omenako, a village in eastern Ghana.

Apoorva Kumar, Jumia’s Chief Operating Officer, told Quartz Africa that “whether they’re ordering electronics, fashion, health, and beauty, or other categories, Zipline’s instant logistics system will provide fast and convenient access.”

Interestingly, some of the biggest eCommerce and logistics companies in the world have touted drone deliveries as the future of online deliveries, but their plans to make it mainstream have failed.

In this article, we’ll look at why some of the world’s biggest drone delivery projects failed and why Jumia has a chance to turn the tide.

Failed drone delivery project

In 2013, Amazon Founder, Jeff Bezos, introduced the world to Amazon Prime Air, the eCommerce giant’s plan to revolutionize delivery systems globally with unmanned aerial vehicles (UAVs), popularly known as drones.

Bezos said the system would be available for customer use in four to five years, but Amazon scrapped the project in 2021

According to Wiredthose in the UK team described the project as dysfunctional and run by managers “detached from reality.”

Amazon was not the only company to make lofty drone delivery promises. Shortly after Bezos revealed Prime Air, DHL launched its first commercial drone service, the Parcelcopter, but ended production in 2021.

To be fair, drone deliveries have improved since Bezos’ announcement in 2013. According to McKinsey,  660,000 commercial drone deliveries have been made in the past three years; this figure is expected to rise to 1.5 million by the end of 2022.

While this is an improvement, it’s far from the mainstream delivery service promised in 2013. For context, Amazon alone did four billion deliveries in 2020 via conventional transportation means, a long way from 660,000 done with drones in three years.

What are the problems with drone delivery?

One of the problems with drone delivery is artificial intelligence (AI). It seems like AI has gone a long way, with the intelligent Google Assistants, Siri, and Alexa knowing the song you wish to listen to and the app you want to open. But according to experts like Charles Onu, we don’t even have AI yet, just machine learning.

Drones are supposed to be autonomous; while information on delivery location is provided for the drones, they get to decide the safest place to land or drop the packages. Therefore, it might not be able to look out for bystanders and objects that might impede the delivery.

On July 2, 2022, one of Amazon’s drones reportedly crashed and exploded in Amazon’s attempt to revamp Air Prime and meet regulatory requirements. The crash was described as a hard landing, and such crashes are one of the setbacks drone delivery faces.

There are also regulatory problems that come with drone delivery. Many commercial aircraft travel through the airspace in urban areas, and regulatory measures are put in place to ensure the airspace is as safe as possible.

For drones to be approved for flight in the US, they must have passed various regulatory requirements, including completing 7,000 safe flights. This means that delivery drones need the approval of the regulatory body of every airspace where they will be active.

Nigeria’s regulatory body for drones is the Nigerian Civil Aviation Authority (NCAA), and its guide for unmanned aircraft system operations says that drones “must meet at least

the same safety and operational standards as manned aircraft.”

Interestingly, safety for drones does not end with knowing where to land and how to drop boxes; they also require cyber security as they’re susceptible to hacks.

Jumia and Zipline could crack drone deliveries

While Amazon and DHL have not recorded successes at drone deliveries, Zipline’s drones have already delivered over 3 million packages and flown over 27 million miles. With that track record, its partnership with Jumia could be fruitful.

According to this video, drone delivery technology is going through the Gartner Hype Cycle, a theoretical framework that defines technological inventions from hype to commercial viability.

Bezos triggered hype when he revealed Amazon’s drone delivery plans in 2013, but unmet expectations saw interest in the tech wane. But according to the Gartner Hype Cycle, this is where companies start researching and coming up with commercial viability.

 

While Zipline’s success with drone deliveries in healthcare augurs well for Jumia, replicating its success in Nigeria, where deliveries must be made to densely populated areas like Lagos, will be quite the challenge.

Do we even need drones?

According to this Wendover video, consumers do not care how their packages are delivered as long as it is fast, cost-efficient, and reliable. People might opt for drone delivery because it sounds exciting, but after some time, it won’t matter if the package is delivered with a car, bike, or drone.

Revenue in Africa’s eCommerce market is already at $43 billion in 2022 and is expected to reach $72 billion by 2025.

In Q2 2022, 60% of Jumia’s deliveries were completed within a day. It also delivered 10.3 million orders in Q2 2022, 35% more than last year.

Zipline’s drones are fast; however, they can only travel 160km (55 minutes) before they need to be recharged at an operational hub.

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