E-commerce prospect, and ‘return of the Drones’

Drone, a unique small flying object eclipsed from D.I.Y experiment during the 2000s into a booming perspective today, the first drone for commercial purposes with a flying permit, issued in 2006, whilst the biggest drone manufacturer is located in China. Shenzhen, Company ‘Dji’ that now holds over 60% of the global market!

The drone industry has underperformed constantlysince it’s glamorous presentation, with the exception, the military who silently incorporated drones for their Operations needs, as their integral part for COVERT missions mainly in crisis area in Afghanistan/Syria/Iraq, while e-commerce failed to endorse innovative gadgets, the drones mainly due to FAA strict regulation, thus the profit in the industry was lacking!

MQ-9 Reaper Drone credits Forbes

Amid the hype & curiosity, drones faced its difficulties, as well as technical setbacks adding the NO license to fly, there was no clear future for the flying phenomena, as the consumer's sentiment began to shrink for drones, mainly seen as ‘adventurous toys’ focused on extreme sports& outdoor activities, with no sign of mass distribution into the markets, the curve started to descent…..driving the project towards uncharted territory!

Project pitching dilemma!

According to Rt Hon Brandon Lewis Drones were even seen as hostile tech from Gov’s in the UK, uncontrolled device on an open-market, that anyone could easily access a drone and penetrate restricted areas as new drone models equipped with cameras were easily bought for as little as 70 $

the project drone was heading towards dead-end, the whole concept idea… started to fade away!

Faced with many uncertainties, low demand, and no clear projection of product development..things were getting messy, in financial terms!… moreover, irresponsible individuals easily gained access to hi-tech drones and used it for their personal gain or specific mission!

Drone project ‘Arch101’ Arsim Ajeti

As in the cases when a drone utilized to;

- Unathorized surveillance raising privacy concerns worldwide …or

-Inciting mass brawl;the football match Albania vs Serbia … and,

-Endangering the safety of the civilian plane and all the passenger onboard famous drone incident in Canada!

Legislation, containing new drone restrictions didn't stop Go-pro to jumped the hype and DJI producing a new model at the same time, giving a much-needed boost to the market.

Gopro, leaders on the quality mini-cameras for outdoors activities, decided to invest into their new drone project worth millions. That unexpected move created a real buzz between entrepreneurs and drones enthusiast were all ecstatic about ‘Karma’ project.

‘KARMA’ Drone, credits GoPro Brasil

GoPro’s ‘KARMA’ …bites back!

Facing an uncharted territory, GoPro found themselves lacking in market penetration, to make things worse their ‘Karma’ project was not developing according to expectations, the drone was lacking in speed and the battery issue was troublesome, with no quick solution on the horizon GoPro found themselves in product innovation dead-end!

Plans stalled and the product was not receiving any important feedback, Gopro decided to ditch their hyped ‘ Karma’ project, and went into financial turmoil soon after, changing the management whilst ongoing downgrade on market, their stocks dipped heavily, and drones underperformed ever since…failing to reach global attention!

The drone industry attracted a renewed interest from the military department who found the device to be a breakthrough for their most covert OP, as a consequence US military included the subsection of drones on their operational prospect, for their primary mission on ‘Intelligence, Surveillance, and Reconnaissance’ utilizing their Covert & spying operations on the foreign territory.

The most groundbreaking OP to date, utilized by drone RQ-170 was the intelligence-gathering mission that led to eelimination of the most wanted man in the Planet, Osama Bin Laden!

Drones became an integral part of the US defense and were randomly used in combat zones in Afghanistan & Iraq….for surveillance purposes and the recent high-profile drone hit, the first-ever mission to terminate the target, as happened with the elimination of the Iranian Commander Q. Soleimani by reaper drone MQ-9 …. [ordered by Trump!]

Drones drifted further away, from what most believed they were destined to do!?!…emission free and fast service, fulfilling consumer’s needs, instead drones became an assassination tool!

E-Commerce chart by U.S. Census Bureau, credits Rebecca Quick, CNBC

E-commerce transformation!

Nowadays C-19 accelerated the market on a global scale, despite all the panic and uncertainty, markets suffered their biggest blow since the great depression, losing billions amid fear and mass isolation from the contagious virus that many scientists, in the beginning, feared to be even worse than a Spanish flu?

Covid crisis turned to be a blessing in disguise for the drone industry… as the needs and demand of e-commerce giants raised exponentially, due to isolation ruling globally, the Ecommerce transformed massively, demand went soaring from online shopping, the drone was seen as a perfect solution to reach remote places, avoid traffic and with low-cost maintenance provide a perfect tool for the markets, during the crisis that has already begun to transform the way industries around the world operate.

According to financial Institution McKenzie, Amazon now can deliver a package in less than half an hour within 30 miles, profitably in comparison with truck delivery for $0.90 on each shipment, cutting the cost of domestic shipping by roughly 90%.

Prime air, Delivery Drones credits Amazon Fire TV

Drones have become safer, more affordable, and smaller while camera quality and flight features have also continued to improve at rapid speeds. Amazon recently acquired the license for drones and among the reasoning amazon cited on their waiver to FAA were;

  • Sustainability as the company’s vision to make all shipments net zero carbon
  • Emission-free & energy efficiency…using sustainable means, traveling to drop off a package as a vast improvement over a car or truck shipping!
  • Reliability, as air prime service ensures faster means to reach any remote or penetrate the dense traffic for fast & efficient deliveries

C-19 accelerated everything in Tech, market digitization, & our everyday life habits, we are about to witness more drone inclusion on our daily e-commerce shipping and beyond!

Moreover, Amazon continuous drive towards market enhancement of autonomous flights and the amount of inexpensive delivery combined, as consumers would increase their e-shopping, arguably would buy more goods online, as growing e-commerce's share of retail sales estimates from 14% in 2019 to a staggering 60% in 2030 according to Statista, that foresees drone delivery more than half of the eCommerce volumes, as the chart below.

Commercial drone projection 2016–2025 credits Statista Inc.

Conclusion;

Our future is all but digitized, cash apps, digital currency, virtual reality is taking over & we are emerging into digital transformation like never seen before…This era will define us, whether we can cope with AI & future tech and the so-called the new normal…or we’ll fail to live up to all the hype, as drones did at the beginning…as the society's expectations are not always aligned with our daily needs and futuristic wants!

REFERENCES

https://www.globenewswire.com/news-release/2020/07/03/2057294/0/en/Global-Commercial-Drones-Market-Forecast-to-2025-with-Profiles-of-DJI-Harris-Aerial-Trimble-Parrot-Drones-PrecisionHawk-3DR-and-AeroVironment.html

https://www.researchgate.net/publication/227442405_An_Empirical_Study_of_the_Impact_of_Nonlinear_Shipping_and_Handling_Fees_on_Purchase_Incidence_and_Expenditure_Decisions

https://www.mckinsey.com/industries/capital-projects-and-infrastructure/our-insights/commercial-drones-are-here-the-future-of-unmanned-aerial-systems

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/840789/Counter-Unmanned_Aircraft_Strategy_Web_Accessible.pdf

https://www.airspacemag.com/military-aviation/drone-staked-out-bin-ladens-neighborhood-180958482/

https://www.theverge.com/2018/1/8/16862680/gopro-drones-business-stopped-layoffs-exit

https://www.forbes.com/sites/denizcam/2020/01/07/the-quiet-billionaires-behind-americas-predator-drone-that-killed-irans-soleimani/#21a4263e5cb0

https://www.drdrone.ca/blogs/drone-news-drone-help-blog/timeline-of-dji-drones

https://www.amazon.com/Amazon-Prime-Air/bie=UTF8&node=8037720011

https://www.cnbc.com/2020/08/31/amazon-prime-now-drone-delivery-fleet-gets-faa-approval.html

https://www.cined.com/more-bad-karma-all-gopro-karma-drones-grounded-due-to-gps-issues/

https://www.simulyze.com/blog/drone-intelligence-gives-military-and-defense-users-the-insight-to-act

https://www.bbc.com/news/av/world-europe-29624759

https://time.com/4983677/drone-crash-passenger-plane/

Fintech heterodox & Innovation writer/ Author (SALFORD/ IFLAS Alumnus)