Key findings from Episerver’s recent survey of 4,500 consumers about their online shopping habits and expectations.
Only a few decades ago the idea that you could place an order for an item in minutes, and have it delivered the same day or within the hour, was inconceivable. Even the notion of receiving a parcel in a matter of days, without having to pay for the privilege, was incredible. Jump forward to 2019 and there’s nothing remarkable about this situation. It's simply become the ‘norm’.
Industry giants such as Amazon have disrupted the market – changing customer’s expectations in the process. Consumers now expect the luxury of an expanding array of products, all available in one-click, with low or no cost delivery. The consequences of the ‘Amazon Effect’ has had a knock-on effect throughout the industry. Making retailers feel the pressure that if they don’t step up their delivery experience, then dissatisfaction will trickle down to their bottom line.
With a finite capability and resources to meet the “I want it now” demands of today’s modern consumer, retailers need to consider what matters most to their customers – is it speed, convenience or free delivery?
There’s no such thing as ‘Free Delivery’
If you work in Operations, you’ll know that there’s no such thing as ‘free delivery’.
Before jumping on the latest delivery bandwagon, retailers need to understand the financial impact and cost to serve as part of their delivery strategy. Not all customers necessarily want premium delivery options all the time (depending on what’s bought, when and why). By adopting a ‘one-size fits all’ approach you could be eating into your margins - when oftentimes, convenience trumps the need for speed.
Convenience and the Pitfalls of Under-delivery
Offering the fastest range of delivery options won’t necessarily ensure customer satisfaction. Instead, providing the most convenient and flexible choices could give you the edge. In today’s fast-paced climate, consumers really do value convenience because they are much more time-starved. Nobody wants to stay in all day for a delivery, or worse wait around for a parcel that’s arriving late.
According to recent research by MetaPack of 3,500 consumers, “61% say a positive delivery experience incentivises them to shop with an e-tailer again”. Overpromising in your delivery options, only to under-deliver, could negatively impact your brand, and your bottom-line.
John Lewis Trials Click & Collect with Co-Op
However, while convenience looks ideal on paper, in practice, providing every option across the board is likely to be unfeasible except to that minority of retailers who have the resources to cater to this diversity. This is where collaboration may help ease the strain…
John Lewis have recognised the need to offer more customers access to their next-day click and collect services in areas where they have fewer shops. To do this John Lewis will be collaborating with the Co-op, giving customers the options to pick up orders at a convenient time and place. The trial will be rolled out to 6 Co-op food stores by the end of the month.
Know Your Customers
Retailers endlessly strategise new ways to meet increasing consumer expectations, whilst logistics companies are looking for new technologies to increase efficiencies and reduce costs. However, through understanding your customers, these problems can be alleviated.
As mentioned earlier, different people have different preferences when it comes to delivery and may not always need premium delivery options. With this in mind, it’s down to the retailers to identify their core customer base and optimise their delivery strategy to suit.
According to Capgemini’s recent survey on final mile logistics, the average consumer expects free or low-cost delivery. The exception is with a younger demographic who are more concerned about the speed of delivery. Therefore, it’s important to understand your demographic as part of your delivery strategy.
Brian Green, Senior Director at Magento, an Adobe Company suggests that retailers, ‘should survey shoppers and competitors to identify the right set of choices to offer. Customer requirements will also change from day to day, purchase to purchase, so it is important for retailers to define the ‘minimum viable service’.
It’s not simply about convenience: convenient delivery options need to go hand in hand with retailers intimately understanding their own customer demographic and their particular wants and needs.
Communication in the Last Mile
Fast, convenient and free delivery is all great. But fulfilment mustn’t be delivered in silence. To get ahead, retailers must have true visibility of the state and location of their orders. To make the delivery and returns experience a positive one, it’s vital to communicate with the customer at every stage. What’s more, the post-purchase communication can be use for promotional offers, cross-selling and up-selling to drive sales and loyalty.
Environmentalism: Think Green
We’ve covered the usual suspects – convenience, speed, cost and communication. However, there’s one more topic we want to cover…The environment.
Environmental awareness has become a top retail trend in 2019. Thanks to increased media coverage, today’s consumers are becoming more concerned about the environmental impact of consumerism and the overall supply chain.
There seems to be a growing appetite for environmentally friendly initiatives. We predict that consumers will be more inclined to ‘think green’ when it comes to the brands they shop with regarding delivery and packaging.
It’s clear retailers should demonstrate their green credentials – from a paperless warehouse, recycled or organic packaging, to efficient logistics and electric delivery vehicles. Whilst choice and convenience are major factors when shopping online, its clear retailers need to up their green credentials. This is becoming an increasingly important factor and if it matters to your customer, then it should matter to you.
And there you have it – whilst the need for speed often steals the limelight. We believe it’s a combination of convenience, communication, and understanding your customer that are essentials to refine your delivery strategy. Finally, with trends leading to the point where customers may sacrifice convenience for an environmentally-friendly purchase, retailers should look to put sustainability to the forefront of their messaging.
In order to truly provide convenient options for customers, however, extensive research should be obtained about how the customer base would like things to be delivered, and these options should then be communicated clearly to any potential purchaser.
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