Conditioned by ecommerce behemoths, consumers now have high expectations for online shopping and ecommerce fulfillment. They demand more than just easy product selection and ultra-fast or same-day delivery; they also want flexibility in both delivery location and delivery time, and real-time updates throughout the parcel’s journey.
Smart retailers understand these rising customer demands, and therefore increasingly put the customer first – not the product – in order to build loyalty.
Even one unsatisfactory experience can end an otherwise fruitful customer relationship. A recent study from BigCommerce indicates that some relationships end before they even get started. The study found 77% of online buyers abandon their purchase if the shipping cost and services are deemed unsatisfactory, and 87% will choose a retailer specifically because free shipping is offered.
BigCommerce also found that 58% of global survey respondents have actually stopped shopping with particular retailers as a result of a negative shipping experience, and the lost sales opportunities don’t stop there. They also share their negative experiences with the world on social media and review sites, meaning a bad delivery experience quickly leads to the further loss of potential customers and brand damage.
Unfortunately for many retailers, this reality strains resources to the breaking point, making it more difficult to think strategically about smart ways to limit shipping costs. However, those who understand what’s at stake with ecommerce fulfillment and commit to reducing costs, providing optimal service and streamlining the customer experience often turn to automation to make gains happen quickly. Automated carrier service selection, delivery alerts, carrier invoice auditing and business intelligence tools can help them better manage order fulfillment, gain a competitive foothold and boost customer loyalty.
Decisioning With Data
With a data-driven approach, retailers can efficiently ship goods worldwide at the lowest possible cost while meeting or exceeding customer expectations. Methodically analyzing parcel shipping data allows you to assess problems, pinpoint their sources for correction and more proactively respond to customer issues. As your ecommerce fulfillment efforts become more efficient, you have the freedom to be nimbler, to offer customers more flexibility and to set yourself apart from competitors by:
- Offering fast, flexible delivery services, increased transparency and proactive responses to individual needs
- Identifying and quickly onboarding new carriers to better leverage last-mile services and expand into international markets
- Tracking compliance and on-time delivery rates with an eye on correcting problems
- Eliminating labor-intensive tasks such as invoice reconciliation
- Uncovering savings opportunities with business intelligence to reinvest elsewhere
Tips for Optimizing Parcel Shipping
Merchants whose ecommerce fulfillment operations are not as streamlined as they would like may not be ready to take these actions. Embracing new technologies can help them lay the groundwork to make this leap more quickly. Whether you tap into existing technologies or build your own fulfillment automation, here are 5 ways to optimize your parcel shipping practices to better serve customers:
Connect assets and systems
Connecting business-critical systems like warehouse management and order management systems with parcel shipping technology will eliminate data silos, enhancing the validity and speed of the end-to-end supply chain. When possible, connecting customers to their shipments as soon as their order is placed adds value. This improves the quality, accessibility and value of a merchant’s fulfillment data.
Get all supply chain entities to use the same system
Ensuring all ecommerce fulfillment centers, all retail locations and/or all brands are on the same technology platform will streamline reporting and improve efficiency throughout the distribution network. Done well, this can improve the efficiency of staff throughout your organization.
Providing proper, cross-functional training on parcel shipping and complementary technologies reduces human errors and employees’ resistance to change.
Utilize BI tools
In addition to uncovering cost-saving opportunities related to day-to-day fulfillment, business intelligence can also provide wide-reaching strategic gains and cost savings by helping evaluate carrier performance and inform carrier contract negotiations.
Monitor parcel delivery issues or exceptions
Before service teams can proactively troubleshoot an exception event, like a delayed or off-track shipment, and communicate delivery updates to the customer in real time, you first need to develop a reliable method of identifying these challenging events.
With both ship-to-store and return-to-store capabilities growing in importance, following these tips will help you develop omnichannel capabilities for better serving and retaining increasingly demanding customers. Case in point: in the 2018 UPS Pulse of the Online Shopper, 50% of U.S. customers surveyed reported shipping to store for pickup and 52% expressed interest in shipping items to an alternate delivery location with reduced fees. Over time, you can improve return processes and incorporate ship-to-store and return-to-store options, making parcel shipping a next-level advantage in an increasingly omnichannel world.
Gartner predicted in 2017 that by this year, same-day delivery will have driven up logistics costs as a percentage of revenue by 50%. Well-prepared retailers are addressing the changes required to upgrade legacy ecommerce fulfillment processes, in order to be more responsive to customer needs and find success in this on-demand world.
Ken Fleming is President of Logistyx