Every day, 1.7
million packages are stolen or go missing off doorsteps across the
country. This is higher than it's ever been before and it's costing Amazon
and other sellers millions.
Expansion of online retail has resulted in expansion in the crime of
package theft, which brings you to something around $9 billion a year in
stolen packages. Now creative solutions are popping up everywhere, from
doorbell cameras to automatic locks, porch lockers to alternative pickup
points. Big and small companies and everyday people are trying to stop the
thieves. This is a custom built bait package that is recording him on four
different cameras and it's about to unleash a pound of the world's finest
glitter along with some other surprises.
We wanted to find out who's losing the most when a package goes missing
and what are Amazon and other companies doing to fight back?
A 2019 survey conducted by insuranceQuotes.com
found that nearly one in five Americans report having a package stolen.
And according to a new study by C+R research, each stolen item costs an
average of $109 to replace, a cost typically passed down to the seller
who's responsible for the refund or replacement.
A lion's share of the loss is being absorbed by the entity doing the
greatest amount of selling, which in this case is Amazon.
Amazon Prime members say they receive on average 51 packages at home every
year, and all respondents spent an average of $222 a month on online
orders. However, 42% of customers say they avoid buying expensive items
online because of theft, meaning Amazon is missing out on even more sales
revenue. In total, the thefts add up to more than $25 million in lost
goods and services each day.
There are stories and anecdotes out there about more organized thieves
actually following trucks and picking packages up off of porches.
But the majority of package theft occurs from someone walking down the
street, seeing an opportunity and grabbing it.
Wakefield Research conducted a study on package theft in 2018 that was
sponsored by Comcast, which owns CNBC.
In urban areas, you see as much as 35 % of adults saying that they've
personally had a package stolen.
In a suburban area, that figure is 20 % and in rural areas it's 13 %.
SafeWise also conducted a study.
It found the places with the highest rates of package theft are the Bay
Area, Salt Lake City and Portland.
Between like 10 and three is going to be the busiest time and it's usually
a time when people are at work or at school or out running errands.
The nicer neighborhoods get packages stolen far more than what you would
think are the rougher sides of town.
And I think because they're going after the better booty.
So what happens when a package is stolen?
According to C+R Research, victims will alert more than one entity.
83 % contact Amazon or the seller, 60 % contact the delivery service, 48 %
checked with neighbors and only 13 % called the police.
So who is it that's financially responsible for the loss?
Your major sellers, your Amazon, eBay, are replacing stolen goods.
The shippers themselves largely aren't incurring this cost.
Now some like FedEx will offer $100 worth of default liability.
You can purchase more.
U.S. Postal Service offers zero liability but you can, of course, purchase
more insurance. But on the whole that $9 billion is being absorbed by the
sellers. Even though it may seem like Amazon replaces your item
immediately after a theft, if that item is sold by a third party, that's
who pays for the replacement or refund.
You can also contact the carrier, the shipper, but they are going to try
to get recourse again from the seller.
But your best chance is to go to where you bought it from and see if
they'll send you out another one.
It's up to the discretion of the seller whether they want to replace your
item. At the end of the day, it's the consumer who pays for this because
think about it, the rates have to go up.
You can't afford to keep having this type of loss.
Although many police departments don't track package theft specifically,
the numbers are definitely up.
Denver, for example, saw a 68 % increase in package theft from 2015 to
2018. Because small retailers and huge sellers like Amazon are spending
more on refunds and replacements every year, they've got a big incentive
to stop the crimes. One solution the e-commerce giant offers is an
automatic front door lock system called Amazon Key, available in 50 cities
for free with compatible smart lock kits.
It lets users unlock the front door remotely, allowing a delivery person
entry into the home. Amazon Key can also open certain garages and
compatible cars, allowing packages to be left in a trunk, for example.
And building managers can use Amazon Key for Business, giving delivery
drivers a smart fob with time limited access to drop off packages inside
an apartment complex. However, C+R Research shows that only 4 % of package
that victims use Amazon Key.
That number may be low for one reason.
Even though you can literally watch it in real time, the idea of unlocking
your door for a stranger while you're not there so they can go in to your
home I think strikes some people as disquieting.
And then there's Amazon lockers.
Packages are left inside these automatic electronic lockers for pickup at
convenience stores, grocery stores, apartment buildings, malls and other
locations in more than 900 U.S.
cities. Locker+ locations, often on college campuses, are staffed and can
hold packages for up to 15 days.
Amazon also offers pickup in-store at certain retailers such as Rite Aid,
GNC, Health Mart and Stage Stores.
We have 11 % who said that they're sending their deliveries to an Amazon
locker or similar type of service.
And then we have 10 % who said that they use some sort of package lockbox.
These individual lockboxes like these from Kingsley Park are often secured
to a porch where carriers enter an access code to leave packages.
And then finally, we have 18 % of respondents said that they wind up
sending their deliveries to their work address.
Amazon says the vast majority of deliveries make it to customers without
an issue and that its customer service is available 24/7.
Amazon Map Tracking also allows customers to view the progress of their
delivery in real time when a driver is close.
And for packages delivered by Amazon it offers a photo on delivery.
Of course not all online shopping happens on Amazon.
So there's also a variety of smaller companies offering electronic smart
lockers. It's really tough to put a canoe into our lockers or a mattress,
but other than that, we put tires all the time, we take some pretty big
items through the lockers.
Parcel Pending has 4,000 locker locations at retail and grocery stores,
companies and apartment complexes in 48 states and Canada.
We've been working with one e-tailer who ships over 300 million packages
and they have talked about tens of millions of dollars of loss in
packages. And so to put in a solution like an electronic locker system,
for them it's almost a drop in the bucket because the loss in packages is
not an insurable event for them.
So it's coming out of their pocket.
When lockers aren't an option, consumers often turn to more homegrown
solutions.
About a third of consumers will actually have a package delivered to a
friend or have a friend or neighbor or family member pick up the package.
Some things are more extreme.
We actually found one in five have taken a sick day or called in a PTO or
vacation day to their employer so that they could be home specifically to
receive a package that they were afraid might be stolen.
The carriers themselves now offer a solution too: skip porch deliveries
altogether by picking up your package at a storefront.
We've got between the UPS Stores and then we announced a partnership with
CVS, Michaels, Advance Auto to add a third one in there, where receivers
can say, okay, I want my packages delivered in those stores as opposed to
their home. UPS says it delivers around 20 million packages every day and
that 63 million customers have signed up for its My Choice program.
Customers can schedule deliveries, reroute packages or set their default
package delivery location to one of 40,000 secure access points around the
world. In the next year or so, 90 to 95 % of the U.S.
coverage will be within five miles of a UPS access point.
FedEx, which says it delivers 15 million packages a day, has a similar
program called Delivery Manager.
It lets customers enter specific instructions for where and how couriers
should make a delivery or lets you reroute a package for pickup at one of
14,000 retail locations like FedEx Office stores, Walgreens, Krogers and
Albertsons. By 2026 we expect the growth to be roughly 100 million
packages a day.
So we're going to have to have plans in place to make sure that there
aren't packages laying out on people's front porches for hours or in some
cases days if they're not home.
And USPS offers a service called Informed Delivery, which it says has more
than 21 million subscribers.
It offers a snapshot of every day's expected deliveries and allows
subscribers to opt for a package to be held at a post office instead of
being left at the front door.
FedEx, UPS, USPS and other carriers also offer package tracking.
And although you can file a claim for missing packages if they were
insured through the carrier, it's typically not the carrier's
responsibility once it's arrived.
Once a package is delivered, it's out of our custodial control.
And so it's really up to law enforcement to work directly with consumers
on any reported theft.
There's a handful of outside companies like TrackerSense and Logistimatics
that make one time GPS trackers for packages.
And then there's startups trying to streamline the entire tracking
process. LA-based Route recently launched its app to offer one-stop-shop
tracking for consumers.
So you open up our app and you see everything that you've ordered from
every merchant in a single map interface.
Route says its algorithms can detect if a package is wrongfully reported
as stolen, helping reduce loss for its 1,800 merchant partners.
And for a fee of 1 % of the item's value, Route will also cover the cost
if a package is stolen. Once the carrier usually drops the package off on
a porch, their job of delivering that is done and a lot of times that's
why they're taking pictures now to show, you know, the proof that the
package was actually delivered.
We're pretty alone on an island in covering porch pirating.
Doorbell cameras are now a common way that consumers try to protect their
packages once they're no longer the carrier's responsibility.
C+R Research found that 25 % of package theft victims install doorbell
cameras like the systems made by Boston-based SimpliSafe.
It's making sure that we have that reliable, high quality video footage
where you're going to capture the face of the person on it so that if
somebody does steal a package, we can follow up on that.
But doorbell cameras don't only capture those with bad intentions.
Their American flag that they had outside their front door had fallen down
and the moment captured on video was a neighbor walking by, seeing that,
righting the flag and saluting to the flag before moving on.
If a crime is underway, SimpliSafe now offers realtime monitoring of video
footage when an alarm is triggered and can dispatch police to the home.
They will know that this is not a false alarm, it's not a waste of time.
This is a really valuable use of their time to catch a crime in action.
And there's a lot of controversy.
Some people feel like, you know, it's giving a lot of access to Big
Brother. But I think we all want Big Brother helping us when it's helping
us recover from a crime.
SimpliSafe's video doorbell costs $169 and it offers a smart lock starting
at $99. Competitor Ring starts at $99.99.
And Google's Nest Hello video doorbell starts at $229.
The problem with that is you get a picture of the bad guy and you see the
bad guy walk away with the package.
But what are you going to do with the bad guy?
Who's going to go after him and is anything really going to happen?
And are you going to catch the guy who took your item?
Typically not.
Hey, put that down.
Screenshots of package thieves from these doorbell cameras often end up
posted online in forums like Nextdoor in hopes the community will
recognize and stop the thieves.
More and more, neighbors are taking matters into their own hands from
baiting thieves with garbage-filled packages, boxes rigged to explode with
blank shotgun shells, or the infamous glitter bomb packages planted by a
former NASA engineer.
We would want to encourage people not to take the law into their own hands
and to go through the proper process of alerting police and not try to set
anything up that could be potentially dangerous.
Carriers and law enforcement recommend filing a police report when a
package theft occurs. When you see the same body type and disguise
happening repeatedly in a neighborhood and you're keeping that footage and
you're sharing it with local law enforcement, there's a much better chance
that you are going to catch someone.
Still, even with a police report, the chances of catching them are slim.
It's actually really quite difficult to find people who are doing this,
really unless you're caught in the act.
The Denver Police Department, one of the few that tracks package theft,
says it arrested 7 % of package thieves in 2018.
The U.S. Postal Inspection Service is your best bet.
However, they were able to make arrests of less than 1 % of the number of
packages that are being stolen per year.
And that's just arrests. It's not convictions and it's not necessarily
finding any of the lost loot.
USPS says postal inspectors arrested almost 2,500 suspects for theft of
mail and packages in 2018.
The average value of a stolen package is far below what would constitute a
felony. In California, for example, the item needs to be worth more than
$950. But in South Carolina, a proposed Defense Against Porch Pirates Act
would make it a felony. And in Texas, lawmakers recently passed a bill
that would fine package thieves between $4,000 and $10,000 with a possible
jail sentence between six months and 10 years.
And some police departments have experimented with beating thieves with
packages and staking out doorsteps.
The reality is, as Amazon continues to bring more shoppers online, there
are simply more opportunities for these easy, simple thefts.
I think it's our job to continue innovating because there will be
continued innovation on the criminal side as well.
Amazon and other sellers are highly motivated to stop the huge losses
incurred by package theft, which means the solutions are constantly
improving from doorbell cameras, tracking and secure locations for package
delivery. There will come a time when we look back at the way we handled
e-commerce deliveries, and I think it'll probably seem fairly primitive
that you just have these cardboard boxes sitting on porches.
Whether it's things like the Amazon Key or lockboxes, technological
innovation is so robust right now and especially if you combine that with
an opportunity for individual entrepreneurs to make money from solving
this problem, I really think that it will be figured out to some extent.
I actually think it's probably gotten a little tougher for criminals to
steal something because there's more attention paid to this, consumer
awareness on it is growing, which our data reflects.
But you're starting from a pretty easy position.
This is not a difficult crime to commit.