A recently released survey by Convey, an Austin, Texas-based provider of cloud-based technology that helps shippers connect disparate data and processes from parcel to freight and first to last mile, highlighted the many delivery-related pain points consumers deal with, especially around the holidays, as well as their delivery and service expectations.
Data for Convey’s survey, entitled “Commitment, Communication and Control: The Modern Customer Delivery Imperative,” was based on feedback from 1,500 consumers, with 40% indicating that delivery represents for the single most decisive factor in the shopping experience.
That 40% figure is not to be understated, considering that shipping issues are pegged to cost retailers more than $333 million over this year’s holiday shopping season, according to data from the National Retail Federation (NRF), coupled with another $1.5 billion on top of that, due to potential lost revenue from customers that will cease doing business with a retailer after a bad shopping experience.
Convey’s research was comprised of many data-driven takeaways that reflect the heightened importance of retailers being able to meet customers; delivery expectations, including:
- 58.6% of consumers said retailers were mediocre when it comes to last mile delivery;
- 90% expect some form of action or compensation for missed promise-by dates;
- 41% want to be notified immediately when a delivery exception occurs, preferring e-mail notifications over all other channels;
- regarding the most important delivery factor during the holiday season, 29% cited a specific promise date, 23% said a delivery date range, and 33% indicated cost;
- more than 95% expect retailers to proactively respond if a carrier’s estimated delivery date changes while a shipment is in transit, and more than 90% expect some form of action or compensation for missed promise-by dates; and
- 57% said they would be impressed if their retailer either refunded shipping costs or expedited a new shipment in response to a late shipment
The low acceptance rate regarding last-mile delivery cited in the data speaks to the reality of what is happening in terms of how Amazon is leading the way from a trend perspective, explained Convey CEO Rob Taylor in an interview.
“As consumers, Amazon has spoiled us all around expectations and a predictable and reliable delivery experience,” he said. “Our focus on this––and why we really created the company––is that delivery and the fulfillment experience is the next battleground in retail.”
This has resulted in Amazon creating what Taylor described as heightened consumer expectations around that delivery experience, as well as retailers having historically invested in the shopping experience and have not made similar investments on the delivery side, as that has been something that has been outsourced to carriers.
Another trend cited by Taylor is that carrier networks for retailers are getting more complex, not less, with a wider array of goods being ordered, ranging from large appliances to furniture to small items all on a same-day basis, which, in turn, creates complexity with the number of carriers that retailers need to use in order to get goods to customers.
“That complexity creates even more of a challenge for retailers to take control of that delivery experience for their customers,” said Taylor. “As a result of all of this, the delivery experience is failing, and retailers need to invest.”
This, he explained, is part of a huge market transition to focusing on the delivery experience, which is only expected to gain more traction, with many retailers already on board, which is expected to lead to broader market adoption.
And while Convey’s findings in the study are focused on the holiday season, Taylor noted it is not just a holiday problem, as it is more of an everyday problem that is exacerbated by the holidays due to the high seasonal volumes.
“One thing that was evident in the research was that more people are sort of backing up their shopping to reduce the risk of a failed delivery experience,” said Taylor. “It speaks to how the delivery experience, in general, does not have predictability, and exception rates are high. So, people just don’t understand that if it is not great the rest of the year then it is certainly going to be a challenge for the holidays so that leads to shopping earlier.”
About the Author
Jeff Berman, Group News Editor
Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman
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