Temando, a leading shipping and fulfillment software platform for commerce, announced U.S. retailer and consumer survey data from its 2016 State of Shipping In Commerce report, covering ecommerce fulfillment trends.
The survey polled 214 micro, small, mid-sized and enterprise retailers and more than 1,000 consumers about a range of shipping-related challenges they face. The survey highlights revenue, customer loyalty, and efficiency opportunities for US retailers to close the gap between what shipping options they offer and what consumers are demanding.
Importance of Multiple Shipping Options
While 71% of all retailers offer more than one shipping option at checkout, the survey revealed that many retailers do not offer the range of shipping options that consumers now expect. The vast majority of consumers (77%) polled have used or would like to use guaranteed weekend or after hours shipping, and 42% are willing to pay a premium for this shipping option. But only 34% of all retailers surveyed offer this shipping option.
Consumers (61%) also want 1–3 hour shipping, and 31% are willing to pay a premium for it. But only 20 % of all retailers surveyed offer this option, including just 19% of enterprise retailers. Consumers (80 %) want same day shipping, and 55% are willing to pay a premium for it. But 47% of all retailers do not offer same day shipping.
Most consumers (82%) also want to collect shipments from stores, and 37% are willing to pay a premium for it. But 50% of all retailers do not offer this option. Three-quarters of consumers also want a specified time slot for delivery, and 37% are willing to pay a premium for it, but only 43% of retailers offer this option.
All retailers surveyed reported that increasing the number of shipping options at checkout helps increase sales (86%), reduce cart abandonment (75%), meet customer expectations (86%), meet shipping deadlines (84%), and ship to a wider geographical area (78%).
Lack of Total Automation
A relatively small percentage of retailers reported having a totally automated process for booking couriers (28%), warehouse management (25%), and product returns (17%). Some retailers are still manually booking couriers (22%), managing warehouse operations (23%) and handling product returns (33%).
In terms of shipping difficulties, enterprise retailers cited meeting customer expectations (38%) and inefficient supply chain (31%) as their top concerns. Small and micro retailers cited high courier rates (37% each) as their top concern (vs. 13% for enterprise retailers). Shipping costs for smaller retailers, who deal with tighter margins and less volume, have a greater effect on their bottom line than larger retailers.
Additional survey findings
– Negative Shipping Experiences — When asked how their businesses are affected when a shipment is lost, delayed or arrives damaged, 41% of all retailers said their brand image is negatively impacted. Reduced customer loyalty (39%), increased cost of returns (36%), and customer service calls (28%) were also key areas that retailers cited were affected by negative shipping experiences.
– Delivery speed – The majority (60%) of mid-sized retailers surveyed can ship orders in less than four hours, while almost half (49%) of micro retailers can ship an online order in under one hour. Meanwhile, 36% of enterprise retailers take 24–48 hours to ship an order.
– Delivery by Drones – One-third of all retailers reported a willingness to use drones to deliver their packages, while half of consumers are willing to accept a drone delivery.
“Shipping and fulfillment are very complex and important processes that are traditionally viewed as a cost center for many businesses,” said Carl Hartmann, CEO and co-founder of Temando. “But with smart investments in software and hardware technology, especially the automation of multiple shipping options, many large and small retailers can transform shipping and fulfillment into a bona fide sales tool, a competitive advantage, and a key way to build customer loyalty.”
Methodology
The Temando survey was conducted online by Research Now and surveyed more than 200 retailers in each of four countries, the United States, United Kingdom, Australia and France. The retailers surveyed all have an understanding of the eCommerce and fulfillment aspects of their businesses (manager or director-level and higher), ship more than five deliveries per week, operate in all main retail categories (e.g., electronics, clothing, furniture, toys, home & garden, books, etc.) except for grocery-related services, and have an online retail revenue greater than one % of their total retail revenue. The survey was conducted in October 2015.