20 Jul Ecommerce Delivery: Setting and Meeting Customer Expectations
A recent article, “Study Finds Expectations Not Being Met in Ecommerce Delivery”, by Mike O’Brien of Multichannel Merchant describes the study results of a survey commissioned by Temando earlier this year. Not surprisingly, the study found that more than half the consumers would abandon their shopping cart if shipping costs were too high and 39% would abandon the cart if there were no free shipping. In addition, 43% of retailers have found that increased revenue could be driven through additional shipping choices.
Temando CEO, Carl Hartmann is quoted as saying, “Shipping is truly the last frontier for commerce, and retailers who master the use of technology to optimize the process are giving themselves the best chance to not only survive, but thrive in these trying times.”
While I agree with this statement, I would change the word “Shipping” to “Fulfillment.” Shipping is a critical component in meeting customer expectations, but the true customer expectation is the time from purchase to delivery, in other words, Fulfillment. It is in this realm where Amazon has set the standard for price/service performance. With over 100 fulfillment centers throughout the US, Amazon holds inventory close to its customers, enabling quick delivery. In addition, utilizing a wide spectrum of delivery carriers including UPS, regional carriers, USPS and their own drivers, they continue to evolve an efficient delivery process.
Competing with Amazon is no doubt difficult. But as Mr. Hartmann says “retailers who master the use of technology to optimize the process are giving themselves the best chance to not only survive, but thrive in these trying times”. In order to do this, there has to be a deep understanding of the current operation and the current customer experience. This understanding requires detailed information about the current processes, including order-to-ship time, ship-to-deliver time, inventory locations, back orders, and errors, as well as the expectation being set by the shopping site.
Using applications such as GrandCanals’ Fulfillment Intelligence Cloud will enable a clear understanding of your starting point. As the fulfillment processes are improved, metrics will track the results. As service improves and additional shipping options are added to improve cost and reliability, the shopping site can more accurately set the delivery expectation.
Using fulfillment data will aid in locating inventory, selecting service modes and carriers, establishing reliable delivery commitment and improving pick/pack operations. Amazon will continue to be a fearsome competitor but most eCommerce retailers can improve their fulfillment processes. The goal should be to identify the delivery date on the product page, provide a reasonable selection of delivery time/cost options and to eliminate statements such as “ships in 24-72 hours” with no indication when the order is to be delivered. Implementing these types of improvements will undoubtedly increase conversions and help drive top line revenue.