Commitment, Communication and Control: The Modern Customer Delivery Imperative

Commitment, Communication and Control: The Modern Customer Delivery Imperative

It s no secret that Amazon has elevated customer expectations, steadily training consumers to focus on the post-purchase experience when evaluating where to spend their dollars. Despite the well-known costs of poor delivery, most retailers still fail to impress when it comes down to the final mile. In fact, the majority of shoppers (58.6%) report that retailers are mediocre at best in this regard. This is a sentiment that is only amplified during the holidays, when most retailers do the bulk of their business and when 32% of shoppers are more likely to blame the retailer for a failed delivery. With every poor experience, retailers pay the price in customer care costs, carrier fees, and lost customers. So, what is a great delivery experience? Today s customers are more demanding than ever, expecting retailers to be responsible for the full experience from cart to door. Gone are the days where words like free and fast could be the golden ticket to a satisfied shopper. In fact, 40% of consumers now report¹ that delivery is the single most decisive factor of the shopping experience, demand to work with retailers over the carrier, and 94% will not return after one delivery failure.² What is active delivery management? Real-time shipment visibility: See all shipments, across all carriers, in real-time, and identify risks before they become experience nightmares Rapid exception resolution: Resolve issues before they impact the customer by becoming a hero rather than a perpetrator Proactive customer communication: Set appropriate expectations and keep customers apprised at every step of their shipment s journey To compete, modern retailers need to take control of the post-purchase experience. Leaders like Amazon, Walmart, and Wayfair have already recognized this imperative and are deploying new delivery initiatives aimed at providing greater transparency, convenience, and delivery options. Ultimately, those that end up on top will be the ones who listen to customers and take an active role in ensuring a great experience during the last, most critical, stage of the buyer journey. To compete, modern retailers need to take control of the post-purchase experience. We completed two surveys with 1,500 shoppers with the goals of identifying the what, when, and how of delivery expectations both during the holidays and the rest of the year. Read on to learn more. 2 1 Convey - http://bit.ly/2i6ho6q ² Dropoff - http://bit.ly/2ylt03a

The 3 C s for Meeting Shopper Delivery Demands

Commitment: Because Dates Matter Just like in a relationship, shoppers expect retailers to make a commitment and keep it. If for some reason retailers are unable to meet their commitments, consumers expect the retailer to seek a resolution or at a very minimum, communicate the mishap if for no other reason than to show a dedication to retaining the customer s business. Across both of our surveys, shoppers emphasized the importance of date commitments to the delivery experience. When asked to choose the most important delivery factor during the holiday season, 29% reported a desire for a specific promise date and another 23% reported a delivery date range, bested only by cost at 33%. Interestingly, 5% of respondents reported that same-day delivery will be the most important factor in their decision to shop online this season, when a few years ago, that was not even an option for most retailers. Additionally, those who ranked date related factors as the most important delivery criteria are 19% more likely to blame the retailer when the delivery issues arise. Planned timing of purchases was indicative of how important dates were to this year s holiday shoppers. Cost ranked highest when the majority of shopping was planned for Cyber Monday or earlier, while dates ranked higher for those shopping later in the season. Unsurprisingly, shoppers were 30% more likely to report same-day delivery as the most important factor if they planned to complete the majority of their purchases after December 18th. 57% of consumers said they would be impressed if their retailer either refunded shipping costs or expedited a new shipment in response to a late shipment. Beyond just being important to the initial purchase decision, shipping delays and date changes were at the top of the list for desired retailer response. In fact, over 95% of shoppers reported that they expect retailers to proactively respond if the carrier s estimated delivery date changes while a shipment is in transit and over 90% expect some form of action or compensation for missed promise-by dates. PREFERRED RESPONSE TO A MISSED PROMISE DATE Refund of shipping costs Discount for a future purchase Expedited shipping for a replacement Expedited shipping for a future purchase No response necessary EXPECTED COMPENSATION FOR OTHER DELAYS Refund of shipping costs Discount for a future purchase Expedited shipping for a replacement Item return & refund* No response necessary *Those shopping after December 18th were 26% more likely to prefer a return and refund if their order was delayed. 4

Communication: It s All About the When & How Shoppers were loud and clear about how and when they want to communicate with retailers. 93% reported that they want to stay informed and receive proactive updates from retailers about their shipments. It appears detailed tracking and exception notifications should now be added to the list of delivery table stakes right up there with free and fast shipping options. Those surveyed indicated that there were three unique communication requirements for retailers: timing, method, and feedback. TIMING When an exception occurs with a delivery, 41% of shoppers expect to be notified immediately and only 7% do not expect to receive a notification. Also key is the ability to provide context around the change or issue within the body of the notification. Only 8% of shoppers prefer to learn about an issue via their tracking page. Gender does appear to play a role in timing expectations, with females being 31% more likely than their male counterparts to desire immediate notification. Shoppers Preferred Communication Channels 50% EMAIL 21% SMS METHOD Shoppers overwhelmingly reported that e-mail notifications were preferable to SMS, phone calls, tracking page updates, and Facebook notifications. Despite the trendiness of Facebook Messenger as a new communication channel, more shoppers stated that they would rather not be notified (7%) than receive a Facebook message (1%) indicating that resources would be better spent establishing e-mail and SMS subscriptions at checkout compared to creating and maintaining Facebook chat bots in the short term. FEEDBACK Only 6% of shoppers suggested that providing feedback in the event of a poor delivery experience was of no interest. Of the 94% interested in providing feedback, convenience is of utmost importance with 68% of shoppers preferring to provide feedback via email or online form compared to other modes of communication (phone, SMS, and Facebook Messenger). There was a strong correlation between the customer wanting to use the same channel for feedback that the retailer used for communication. 12% PHONE CALL 7% PREFER NO CONTACT 1% OTHER 8% TRACKING PAGE 1% FACEBOOK MESSENGER 5

Control: A Little Give and Take Survey respondents made it clear that they both want retailers to take control of resolving shipping issues, and they also have a desire to be in control over certain options that impact the convenience of the delivery. In the case of common delivery exceptions, customers were most likely to expect the retailer to take action to resolve the issue, but were more likely to view the retailer in an exceptional light if provided the right resolution options. Early investment in this kind of active intervention and integration of customer preferences has the most potential to not only meet but exceed customer expectations for delivery solidifying brand loyalty in ways that only superb customer/retailer experiences can. Shoppers aged 18-34 are 35% more likely to prefer self-service options such as pick-up lockers and holding a shipment at a terminal When it comes to retailers managing deliveries to success, it is not just about the what of fixing an issue it is also imperative to address the how. We asked customers to share their expectations around how the most common shipping exceptions should be handled, as well as to share what options would impress or exceed their expectations if made available. The universal expectation, regardless of issue, was that shoppers (97.5%) expect to either be able to self-serve or interact with the retailer directly to resolve delivery issues. Today, a huge disconnect exists here, as many retailers, including those acutely focused on customer service, do not have the tools or processes in place to meet this need often responding reactively to inbound calls and in many cases sending shoppers to brave a carrier s 1-800 number. Major parcel carriers have made incredible strides in recent years introducing a multitude of self-serve functionality including USPS s announcement that shoppers will now be able to reschedule delivery times online to ensure someone is home. In spite of these advancements, adoption will likely be limited until retailers are able to communicate and coordinate on the customer s behalf. INCORRECT ADDRESSES 32% Re-route the shipment 26% Any free resolution s 24% Return and expedite a new one 7% Hold at terminal 5% Send to pickup locker 4% Any paid resolution 2% Coordinate with carrier 32% 26% 24% DAMAGES 57% Refund All Costs 32% Expedited shipping on replacement 6% Credit for future purchase 4% No action expected 1% Help process the claim 57% 32% How to Exceed Expectations 58% Automatically refund shipping costs if late 57% Expedite delivery for free if late 38% Allow shoppers to choose a specific delivery date 19% Allow the shopper to reroute a package 7% 5% 4% 2% 6% 4% 1% 11% Allow shopper to request the package be held at terminal 6

Shopper Expectations Intensify During the Holiday Season As the holidays creep closer and closer, customers expectations only heighten. As e-commerce sales are projected to overtake brick and mortar sales this year,³ creating a delivery experience that delights and surprises customers will have a lasting effect on whether shoppers return in January and beyond. Dropoff reported that when a retailer keeps its promises during the holiday, customers are 17% more likely to recommend it than during any other time of the year.⁴ Our survey corroborated the impact delivery can have on overall brand opinions. 27% of respondents reported that they expect retailers to perform better delivery during the holidays than compared to any other point in the year, and 32% of shoppers reported that they are more likely to blame a retailer for any delivery issues during the holidays. Here are some other interesting nuances about holiday delivery preferences our survey revealed: Holiday shopping is creeping earlier in the year, with 20% expecting to do their shopping ahead of Thanksgiving and 22% expect to have finished shopping by Cyber Monday. Online power shoppers or those who plan to do 75% or more of their holiday shopping online are 7% less likely to blame the retailer when deliveries go wrong. These same shoppers are also 2x as likely to expect to be able to make changes to their order while it s in transit, no questions asked. Preconceived notions play a role in how much shopping a customer will do online. Those who believe retailers will do a poor job during the holidays are 2x less likely to complete the majority of their shopping online this season. Shoppers who indicate that date related factors are the most important delivery criteria during the holidays are 18% more likely to blame the retailer for any issues. Those who expect more frequent, and more timely, notification about delivery issues are 23% less likely to blame the retailer for failed deliveries during the holidays. 7 ³ Retail Dive - http://bit.ly/2xliyje ⁴ Dropoff - http://bit.ly/2ylt03a

Nurturing Loyalty and Trust Through Delivery is Key to Future Success Consumers across the country have spoken in order to earn customer loyalty, retailers must heed the call of their shoppers and improve final mile visibility. This will mean embracing the tools and processes required to manage delivery experiences at scale, establishing clear channels for customer communication, and becoming more ingrained with carrier service teams. While it is clear that customer expectations far exceed current delivery management capabilities for many retailers, innovative retailers and carriers are actively pursuing creative strategies to bridge this gap. Retailers like Amazon and Wayfair are taking control over delivery by beginning to own the operations related to last mile fulfillment. Carriers like UPS, FedEx and USPS are providing shoppers with more options to make changes to shipments in transit. Regardless, shoppers clear preference to work with retailers not carriers requires retailers who rely on common carriers to add capabilities that allow them to actively manage deliveries. In order for retailers to garner long-lasting loyalty, shoppers must feel empowered with the knowledge and confidence that their retailers will be on their side if a delivery goes awry. Key Takeaways: Dates matter. Communicate actively and often. Take control and resolve exceptions. Give shoppers a voice. Everything is more important during the holidays. 8 ⁵ Convey - http://bit.ly/2lmz6lt

About the Research Convey recently conducted two surveys of 1500 people on delivery expectations and preferences both yearround and specific to the holiday season with the goal of understanding what aspects of delivery consumers found important, and how those factors change leading up to high-pressure retail seasons. Both surveys were completed with Google Consumer Surveys. Survey Demographics PERCENTAGE OF EACH AGE GROUP REPRESENTED 18-34 years of age: 20.6% 35-54 years of age: 38.1% 55-65+ years of age: 41.5% PERCENTAGE OF EACH US REGION REPRESENTED Midwest: 26.4% Northeast: 17.3% South: 33.7% West: 22.6% PERCENTAGE OF EACH GENDER REPRESENTED Male: 51.8% Female: 48.3% WHEN CUSTOMERS PLAN TO DO THE MAJORITY OF YOUR ONLINE HOLIDAY SHOPPING 19.6% BEFORE THANKSGIVING 14.7% BLACK FRIDAY 7.3% CYBER MONDAY 41.2% BETWEEN CYBER MONDAY & DECEMBER 18TH 17.1% AFTER DECEMBER 18TH 9

About Convey At Convey, we believe the world s supply chains need reinvention. As channels, carrier networks, and consumer demands become increasingly complicated, pressure is mounting for logistics and operations teams to become more dynamic, agile, and customer-centric. From parcel to freight, and first to final mile, Convey helps the world s largest brands reduce costs, improve visibility and transform transportation into their next competitive advantage. LEARN MORE AT: www.getconvey.com/get-started