Online sales are consistently outpacing brick-and-mortar stores with more retailers moving toward multichannel selling. Consumers are using social media to review items and shop for the best deals while retailers are investing more in mobile commerce, proving it can generate sales and traffic. Retailers of all sizes are looking for ways to reduce costs and better serve their customers.
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According to comScore’s recent Online Shopping Customer Experience Study, 86% of consumers are satisfied with shopping online; however, there’s room to improve the post-purchase process, particularly in areas related to shipping and returns. The study, commissioned by UPS, evaluates shopping habits of online shoppers.
Consumers are most satisfied with the checkout process, the variety of products or brands offered and the ability to track their purchases. Online shoppers are least satisfied with the flexibility to choose a delivery date, rerouting packages and the hassle of returning or exchanging unwanted items.
Analysts predict e-commerce will continue to grow 12% a year through 2016. Looking ahead to the next decade, the key question is how the top retailers to the small local boutiques can differentiate themselves in the crowded online marketplace. The answer lies in a less explored area: the post-purchase process.
Here’s what consumers want, according to the study:
Hassle-free and simple returns
Consumers love the convenience of shopping online, but complicated returns policies are far from convenient. With the rise in online sales, more people are returning items they no longer try on or touch when shopping in stores and they’re finding themselves faced with inconvenience returns policies.
In the survey, returns were rated among the lowest areas of satisfaction and a significant 63% of consumers said they review a retailer’s return policy before making an online purchase. When they do send back unwanted items, consumers said after paying for return shipping, the time it took to receive a credit or refund was frustrating.
Some companies have implemented technology to have visibility of the inbound return in order, enabling them to issue a credit or refund as soon as the item enters the UPS tracking system.
This year, UPS has seen a 15% increase in returns over last year. That’s a significant increase and illustrates why the returns experience matters more now than it did just a few years ago.
Nearly half of online shoppers say they would shop more often with a retailer who offers a lenient, easy-to-understand returns policy and would also recommend that retailer to a friend. Online shoe retailer Zappos is known for its 365-day return policy. Sierra Trading Post offers “no questions asked” returns, and if you bought an item on Nordstrom’s online site – you can return it to the closest store for a refund.
The need for speed
Another way retailers can stimulate sales is offering faster shipping options. Nearly half of online shoppers said they are not willing to wait more than five days to receive their purchases. Another 60% of consumers said they want a guaranteed or estimated delivery date at checkout, while 42% have abandoned an online shopping cart because of the delivery date.
Online shoppers also want a variety of delivery options. Retailers can eliminate barriers by providing options including economy ground, ground and 2- to 3-day air. While most consumers choose the most economical shipping option, 30% expect the option to ship overnight. The desire for speed and visibility increases as the value of the purchase increases.
Tracking, visibility and control
Consumers want tracking capabilities so they know when their packages will arrive. The comScore study shows 75% of shoppers believe every retailer should offer tracking information and 45% prefer to receive it via email or text message.
Some retailers offer updates once the item has been processed and shipped. Others work with their shipping partners to further enhance the post-purchase customer experience, providing ongoing proactive status updates.
Free shipping
Not surprisingly, nearly 60% of online shoppers want to see more free or discounted shipping options from retailers in the near future. While 47% say free shipping is the most important option at checkout, many consumers are willing to pay to receive products faster.
The survey shows consumers generally expect free shipping when their order is more than $50, and free return shipping. Retailers should view free shipping as part of a broader marketing strategy and should perform a detailed assessment of their customer mix and needs before making a decision on whether to offer free shipping.
Alan Gershenhorn is chief sales, marketing and strategy officer at UPS.