Reinforcing the view that it’s better to know what your audience wants than to jump on the same-day delivery bandwagon, an executive with QVC told attendees of Home Delivery World that offering customer choice – especially free shipping – and knowing their preferences is the most important thing.
“There are a lot of options out there, and many upstart companies offering same day,” said Douglas King, director of transportation and drop shipping for QVC, as he ticked off a laundry list of startups. “But what are customers looking for? Amazon is certainly changing the paradigm of what speed looks like. But here’s a relief: You don’t necessarily need speed.”
King cited a 2015 Statista study which showed that only 15% of U.S. consumers choose two-day delivery, while 67% select a 3-5 day shipping option. The same study found European consumers are slightly more enamored of speed, with 34% choosing two-day, and 25% selecting 3-5 day delivery.
“Do you need to be a leader in speed?” King asked rhetorically. “Know who you are, and what your customers need from you. Balance out speed vs. relationships, and be aware of what’s meaningful to them.”
King said alternate delivery options like UPS’s pickup location program, with 4,000 U.S. locations, are gaining in popularity. “You see a lot of the larger carriers embracing this,” he said. “It’s a win-win: UPS gets the delivery, with multiple packages to a single address, and the customer has the security and safety of not having their package left on their porch.”
One downside of pickup locations for what King called “omnivore shoppers” who buy from multiple retailers is it could require them to drive around to get all their stuff. “If you place orders with QVC, Macy’s and Amazon, you may go on a tour of pickup locations in your city,” he said. “A pickup service tied into multiple carriers is something to watch for.”
As have many others, King said that at least so far, free or cheap trumps fast and expensive. “We’re a patient lot when we know we’re getting it for free,” he said. “This has driven the rise of more economical shipping methods like Parcel Select.”
King said demand for speed also varies by region. For instance, the mountain states and the North Central plains, from Idaho east through North Dakota and south to Colorado, are more tolerant of slower shipping times, as are of course residents of Alaska, Hawaii and Puerto Rico.
“Our typical customers are different than the types we’re talking about (who want it now),” King said. “She’s 53.8 years old, with a high net income and patient. Also the more rural areas are just appreciative of the ability to buy something online and have it sent to them.”
Mike O’Brien is Senior Editor of Multichannel Merchant