Nudging the last mile: Combining behavioral insights and monetary incentives for sustainable delivery choices

Abstract

Last-mile delivery, the final leg of the supply chain to consumers, significantly impacts the environment, particularly in the grocery sector, due to the perishable nature of food items often necessitating expedited delivery methods. The role of consumer behavior in this process has been overlooked, and their preferences in a trade-off between the benefits of grocery home delivery and the environment have yet to be clarified. This paper bridges this gap by integrating behavioral logistics with key drivers of green consumer behavior to optimize grocery delivery, leveraging primary consumer data to enhance efficiency and minimize environmental impact. Using a two-part methodology, the research combines a controlled experiment and an optimization model. By partnering with an Italian supermarket, this research examines the impact of financial incentives, green nudges, and peer collaboration on consumer grocery delivery choices and routing optimization. The findings reveal that moral green nudges outweigh financial incentives and amplify the effect, and peer influence drives the adoption of shared and more sustainable delivery systems. The optimization model quantifies these behavioral insights, demonstrating cost reductions of up to 42.5% through flexible delivery scheduling and 76.8% via a shared cart mechanism. The findings provide valuable insights for practitioners and policymakers willing to intervene in the crossing of consumer choices and grocery delivery efficiency by presenting an innovative and ready-to-implement solution, which we denote as “the shared cart”. In showing the importance of social pressure for collaborative pro-environmental behavior, the shared cart practically embodies the potential for safeguarding the environment, while enabling cost-saving for last-mile delivery in the grocery sector.