FedEx and Cart.com form a strategic alliance to combat e-commerce

It’s difficult to break into the marketplace and compete with companies like Amazon, Shopify, and eBay. Working with a powerful freight forwarder can make it easier.

This is exactly the way Cart.com from Austin, Texas is going. The e-commerce platform on Wednesday announced a strategic alliance with FedEx (NYSE: FDX) Dataworks, the airline’s data science and machine learning arm, to improve the online shopping experience for merchants and consumers alike.

The collaboration will bring together insights from Cart.com’s Unified Analytics platform and FedEx’s wealth of fulfillment data to develop integrated solutions that enhance the e-commerce experience in a variety of ways.

For example, one will focus on optimizing retailers’ omnichannel sales by driving demand across all channels and reaching out to customers where they search and buy most. The companies will also work to add more delivery options that are faster, more affordable, or lower emissions. They will also help merchants develop more efficient returns management strategies.

Another focus will be on improved fulfillment insights that can help merchants determine the best stock locations and source inventory for quick and easy deliveries. Greater shipping visibility is another goal so customers know exactly where their order is and when it will arrive.

As e-commerce and online shopping have gone mainstream, brands need to worry more than ever when it comes to delivering good customer experiences.

According to Ipsos, a staggering 85% of online shoppers said they would switch to a competitor if they had a negative delivery experience. And according to Khoros, 83% of consumers consider the quality of customer service when making their purchasing decisions.

“Actionable data remains a competitive advantage,” said Omair Tariq, CEO and co-founder of Cart.com. “Combined with FedEx’s powerful post-sales experience data insights, we are able to create unparalleled solutions that offer merchants consistency and confidence in managing their business and interacting with their customers, while enabling an easy and reliable e-commerce journey for Consumer.”

For Cart.com, the merger with FedEx is just the culmination of a strong year that raised $240 million in funding amid explosive revenue growth.


Watch: The State of FedEx


But for FedEx, the move could be interpreted as a way to restart the carrier’s slowing e-commerce business. The company began grounding flights, grounding planes and closing stores in September as demand for e-commerce shipping slacked.

By combining Dataworks’ post-sales insights with Cart.com’s pre-sales data, FedEx may attempt to better understand the sales environment for e-commerce shippers — and potentially find new ways to capture it.

“With the power of our digital and physical networks, we are redefining what’s possible,” said Sriram Krishnasamy, CEO of FedEx Dataworks. “We are developing new tools to help retailers make more informed supply chain decisions in alignment with their fulfillment plans, sustainability goals and consumer promises.”

Like many carriers, FedEx was surprised by the speed at which consumer spending shifted from goods to services. Company estimates had projected that demand for its premium shipping service would return to pandemic highs by the second half of 2024. However, that goal could be in jeopardy.

“The onset, speed and depth of this change undoubtedly exceeded what we certainly anticipated,” FedEx chief financial officer Mike Lenz said Tuesday at the virtual Baird Global Industrial Conference.

“We were up to 16 flights across the Pacific – that was the plan,” Lenz added, addressing the company’s reduction in flight operations. “There is no scenario where we envision going back to this level of transpacific flying, even if you saw a shift. Every downturn creates an upturn, but even under these circumstances we would not return to this level of flying.”

FedEx is also consolidating its ground network and waiving driver vacations in its less-than-truck cargo arm, FedEx Freight, next month.

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