David Bernabeu, founder, and CEO at Citibox tells us how they’re disrupting the last mile delivery.
First of all, how are you and your family doing in these COVID-19 times?
David Bernabeu: Fortunately, we are all good. Thanks for asking. I hope you all are fine too.
Tell us about you, your career, and how you founded Citibox.
David Bernabeu: I am the founder and CEO of Citibox, a company that is revolutionizing the way parcels are delivered. I am a pharmacy graduate but I realized early on that I wasn’t born for that, my path was to become an entrepreneur. I pursued an MBA to get more experience in business administration which has led to 14 years of C-Level experience.
How does Citibox innovate?
David Bernabeu: The last mile runs on a legacy structure that penalizes the world’s fastest-growing industry: eCommerce. Traditional home delivery methods are inefficient and not customer-driven. They have not changed over the past 50 years, and the pain is increasing due to the double-digit growth of e-commerce.
The problems are clear, but no one wants to face them:
- There are around 30% missed first-time delivery attempts
- Couriers need to speak to and coordinate deliveries with users
- Users need to stay at home to wait for the parcel
- There is a limited delivery time window for couriers
Consequently, end-users become frustrated, carrier costs increase, there are more delivery routes, congestion, and pollution that finally results in a strong negative environmental impact.
We realized that there is no convenient way to receive online orders at home, which is where 86% of users want to receive their parcels, so we decided to create Citibox. Citibox is not a mailbox, and it is a software platform that connects all carriers with online shoppers through multi-user smart parcel boxes installed inside residential buildings. So if I had to answer how Citibox innovates, I would say that our platform is not only the best solution for users to have the best online shopping experience but also an ecosystem to increase last-mile capacity, boost e-commerce, and radically increase carriers’ productivity—all this while having a positive impact on cities and the environment, making them more sustainable in the near future.
One of our key initiatives will completely disrupt last-mile delivery as we know it today by enabling night deliveries. This will provide couriers with massive productivity gains as they don’t have to fight through traffic, parking issues, etc. Customers will benefit from receiving their parcels earlier, and cities as a whole will enjoy a better quality of life and reduced CO2 emissions as we help shift thousands of delivery vans from rush hour traffic to less busy deliveries during the night. Win-win for everyone.
How does the coronavirus pandemic affect your business finances?
David Bernabeu: This pandemic situation has made a lot of enterprises suffer. They have had to make tough decisions that shouldn’t have been taken in other circumstances. A record of Temporary Employment Regulation has become a bunch of words more used than expected.
In Citibox, we are privileged. As I’m sure you remember, during the lockdown, people bought a lot online, and that was music for our ears. Our boxes witnessed a sharp increase in transactions during the first weeks of confinement. But the growth of e-commerce was not the only factor for Citibox to consider this pandemic situation as an opportunity. Covid has brought with it a characteristic that we had never thought about: Social distancing. Our parcel boxes allow couriers to deliver parcels with no need to interact with the recipient, which has boosted the demand for our service.
Did you have to make difficult choices regarding human resources, and what are the lessons learned?
David Bernabeu: Our company has grown in the number of locations, boxes, users, transactions, MAUs, and as a consequence, also in headcount. We are lucky to work at a company that continues to add talent these days.
How did your customer relationship management evolve? Do you use any specific tools to be efficient?
David Bernabeu: The nature of our service makes our offering very personal. People don’t know yet what a parcel box is and what it is for, so we need to invest time and resources to explain the product and the service. Obviously, when they receive the information, they fall in love with the solution, but we need to pass through this process. This new (pandemic) situation challenged us to look for new commercial processes as we weren’t able to make physical visits. That’s why we started testing how digital and telemarketing channels could work for us. Bingo! They did. We changed the way we were selling to bet on new channels that we hadn’t tested before, and the results were great. COVID-19 made us think outside of the box and find new ways to acquire, maintain and retain our customers.
Did you benefit from any government grants, and did that help keep your business afloat?
David Bernabeu: We are very fortunate to be in a healthy financial position. We have the support of the European Commission through the H2020 program, which targets highly innovative SMEs showing a strong ambition to develop, grow and internationalize. Citibox was awarded a grant in 2019 for its contribution to reducing negative externalities of the urban freight related to e-commerce.
We did not apply to this program to be economically sustainable but to be able to deploy our innovative and sustainable solution quicker into other European countries. This is helping us to set up pilots and demonstrators (POC) as we did in Paris at the end of 2020.
Your final thoughts?
David Bernabeu: COVID-19 put us up against the ropes. We needed to think fast and out of the box in order to continue our activity not only during the lookdown but also during the challenging months that followed. I am proud of the team. We have been able to adapt rapidly to the new circumstances when things changed suddenly without notice. We are lucky to be part of an exceptional company and a sector that continue to grow while the world is, unfortunately, being hit hard economically, as well as all the tragedy of all the human lives lost.
Nevertheless, Covid-19 has been a huge opportunity for us as the demand for our solution soared. We are very proud to know that we can change the way parcels are delivered and to make this world a little better as soon as COVID-19 finally disappears.