The low-tech secret to last-mile success – Future of Ecommerce – Charles Brewer’s personal blog

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GUEST ARTICLE:

  • Basic delivery standards and processes can result in far more accurate and timely last-mile deliveries.
  • Something as simple as multiple delivery attempts can significantly reduce missed shipments and customer complaints.
  • Working with DHL eCommerce, Shiseido turned detractors into satisfied customers by making multiple delivery attempts and notifications the standard for its Thailand e-commerce operations.

By Kiattichai Pitpreecha, Managing Director, DHL eCommerce Thailand.

Shiseido, the Japanese cosmetics giant, was no stranger to cross-border e-commerce. But when the the company expanded its e-commerce operations into Thailand, it quickly ran up against a raft of last-mile issues: rising claims of lost and damaged goods, late deliveries, and increasing dissatisfaction amongst its B2B customers.

The company operates in 120 countries worldwide, and was one of the first cosmetics makers to take its B2B sales online. But in the $4.3-billion Thai cosmetics market – one of the largest in South-East Asia – the stakes were too high for last-mile failure.

In the words of Shiseido Thailand: “Our Cosmetic and Personal Care business groups have been growing dramatically, especially in e-commerce sales, but this rapid growth has never been easy to manage. We had very limited status visibility of last-mile deliveries in Thailand, and needed our supply chain to catch up very quickly with the business.”

After making it mandatory for couriers to make at least three attempts at delivery before returning to base, complaints about missed orders dropped significantly.

The solution proved simple: make multiple attempts at delivery. After making it mandatory for couriers to make at least three attempts at delivery before returning to base, complaints about missed orders dropped significantly. At the same time, couriers would automatically send notifications to customers before making each attempt, raising the likelihood that they’d be available on at least one occasion.

Visibility was greatly improved as a result said Shiseido Thailand: “E-signing and status summary reports are solving the issue of limited visibility for us. This helps us in maintaining the 1-day arrival guarantees for deliveries in Bangkok and metropolitan areas, and arrival within 2-3 days of dispatch for upcountry areas.”

High-tech doesn’t always mean high-touch

E-commerce merchants typically struggle in two areas of last-mile delivery: when orders arrive at each customer’s doorstep, and the quality in which they arrive. Customers demand high levels of precision when it comes to the timeliness of delivery: guaranteed delivery dates and choice of time slots for delivery are e-commerce must-haves for at least 80% of the population in Asia. And poor or inconsistent order quality can quickly create logistics nightmares for e-commerce merchants as they seek to both assuage displeased customers and handle complicated returns processes. Neither of these are problems that technology alone can easily solve.

E-commerce merchants need to invest in the right standards for the last mile before they consider upgrading their technology.

Even the most sophisticated track-and-trace software won’t keep a parcel from being damaged en route – or resolve disputes when a customer claims they didn’t receive their order. E-commerce merchants need to invest in the right standards for the last mile before they consider upgrading their technology.

Signed, sealed, and delivered

By increasing delivery attempts, we helped Shiseido reduce missed orders, but didn’t tackle complaints of late or damaged goods. For that, the cosmetics giant adopted a basic proof-of-delivery system: each customer would inspect their order and sign electronically for receipt if it passed muster. Shiseido would then have not only a record that the goods had arrived in the right condition, but also the precise time – sent at the point of signature – that the goods were received.

Apart from making fraudulent claims much harder, the system also ensures that any genuine issues get resolved far more promptly – making the returns process much simpler and more pleasant for both Shiseido and its customers. Although the technology involved in electronic proof-of-demand is basic, making it a must-use for all last mile deliveries helped Shiseido chart exactly how it was doing against its delivery-time guarantees across Thailand, and quickly weed out baseless claims from valid ones.

Three-attempt delivery and electronic proof-of-demand come standard with DHL eCommerce’s Domestic Delivery service, which Shiseido used to replace its former courier’s point-to-point services. Domestic Delivery also supports a range of payment types – ranging from cash-on-demand to e-wallets – as well as various delivery modes for customers to choose pick-up locations and times.

E-commerce merchants have so much technological complexity to deal with, from their front-end marketplaces to payment options. For the last mile, even basic standards like trying delivery more than once and signing off on orders can cut complaints without complicating matters.

The key to success is consistency: couriers need to follow those standard procedures for every customer, every time to really earn their trust and satisfaction.

Find out more about DHL eCommerce solutions for Shiseido here.

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