For more than a decade, entrepreneurs have looked to the Web as the ultimate gold mine for starting a new business. While many early e-tailing ventures have gone by the wayside, entrepreneurs remain undaunted. Every day, they are launching new online businesses. And many of those ventures are succeeding.
One of the most important issues that a startup online business faces is its logistics infrastructure, including getting products to the consumer and managing the returns process, says Jeff Reid, director, UPS Customer Technology Marketing.
New online businesses must be able to answer any and all customer questions, including:
- When will the product ship?
- When will it arrive?
- Is there a guaranteed delivery date?
- Is it possible to switch delivery destinations after the order is processed?
- What options does a customer have if there is a problem with the product?
On the front end, an e-tailer’s Web site is more than a URL address, Reid says. It must offer content and functionality that results in sales, and it must allow the customer to easily navigate through the entire shopping, buying and support process.
An e-mail notification after the transaction is completed also allows the customer to stay engaged in the process from order to delivery, Reid says. On the back end, startup e-tailers must plan ahead by knowing who their customer is, deciding what promises they will make to the customer and delivering on those promises, Reid says. Failure to do so could result in a supply chain that breaks under the pressure.
“Thinking of how you will fulfill your promise to the customer should come before how sleek your site will look,” he notes. Full visibility of the supply chain is critical to satisfying online customers. “Providing transparency into your operations makes customers feel that they are part of the process and less likely to have buyer’s remorse,” Reid points out.
Running a smooth e-tailing business also means integrating your order entry operations with your shipping department. Customers don’t call your back dock to ask “where is my shipment”; they call your customer support number or look on your site for that information. Successful e-tailers integrate tracking, time-in-transit and shipping cost information into their customer support functions. UPS Online Tools is a suite of applications customers can use to integrate tracking, rating and other shipping tasks right into their customer service systems. This gives your customer support staff the ability to answer the “where is my shipment” question while your customer is online or on the phone without the hassle of call backs because you need to check with the shipping department.
Reverse logistics is also a piece of the puzzle that new online businesses must address before launching operations. The escalating costs and time-consuming nature of handling product returns can dull a young company’s competitive edge and stall its business.
“You can gain an immediate competitive advantage and the ability to assign more capital to your core competencies if you plan for a solid returns process,” Reid says. “Productivity and service improvements result because management spends less time dealing with product return issues. Keeping a customer online means meeting their needs during the entire buying process,” he adds. “As long as a customer needs to try on something to see if it fits means there will always be a need for a returns process.”
Despite the increasing importance of productivity gains, above all, service is important to online customers.
“They want personalization when they come to a site, and they want to engage you on all levels of the experience through the Web channel and not have to transfer to another channel, such as the telephone,” Reid says. “Buyers shop online because it is convenient, but they also want a seamless shipping process. That’s why knowing your customers has become essential to making your business a responsive service organization.”
To learn more about how a proper logistics infrastructure can affect your e-tail business, click here to schedule an appointment with UPS at this year’s NCOF.
If you’re not attending NCOF but would like more information from UPS, please send UPS an e-mail.
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