How has COVID-19 impacted customer perceptions and demand for delivery services: An exploratory analysis

Abstract

The novel coronavirus (COVID-19) pandemic created an environment where nearly all aspects of mobility changed to ensure the health and safety of the public. The Centers for Disease Control and Prevention (CDC) recommended that people quarantine for 14 days if they were potentially exposed to the virus, stay at least six feet apart from others, and stay at home as much as possible. Delivery via third-party restaurant app, grocery, and package delivery quickly became an essential service. This study assesses customer's changes in use and perceived quality of delivery services in Southwest Virginia, via an online stated-preference survey (n = 423). The responses were analyzed using ordered logit and generalized ordered logit models to identify which population segments had changing delivery behavior and perceptions due to the pandemic. Findings include that before the pandemic, only households with an income greater than $100,000 had a significantly higher demand for package delivery services than those making less than $25,000. During the pandemic, all income brackets had a significantly higher demand for package delivery “weekly” than households with less than a $25,000 income, with a 19.50%, 22.54%, and 45.59% greater chance of use for income levels $25,000 to $50,000, $50,000 to $100,000, and over $100,000, respectively. This trend highlights that package delivery became necessary during the pandemic. Respondents who lived within town limits were statistically significantly more likely to use third-party restaurant delivery apps at least once a week before (3.10%), during (9.20%), and after (4.50%) the pandemic compared to those outside town limits. The results also found people who lived within town limits were 7.77% more likely to be satisfied with delivery services in general than those who lived outside town limits. The findings from this paper identify expanding delivery equity gaps within the population and provide recommendations for policymakers and delivery agencies. Some limitations include that low sample size did not allow for fully segmented models and meant that the study should be considered exploratory in nature.