There are a trillion reasons why online retailers have to pack each delivery box with something that captures the emotion of the moment. The trick is making those feelings good ones, by seeing what the shopper sees when that package arrives.
Online retail sales are predicted to reach nearly $910 billion in 2021 – up 13.7% over 2020, according to a report by eMarketer. That translates to billions of packages – an estimated 3 billion were delivered in the last holiday season alone – and customers expect each shipment to arrive friction-free.
Fulfillment can be what digital marketing expert Avinash Kaushik, author of the book Web Analytics 2.0, calls a “feelings-generating moment.” And those feelings are critical: 47% of consumers told the last-mile technology firm Convey Inc. they would not likely shop with a retailer after a bad shipping experience.
At the same time, consumers are turning up the heat. In early 2021, 26% of shoppers said they ordered same-day delivery, via online, from a physical store in the previous six months. That was up from 14% in August 2020.
There Are Efficient Routes To Engagement. Let’s Unpack Them
Perhaps the most crucial point in all of fulfillment is that last mile. It ensures more accurate delivery windows and on-time arrival. However, last-mile delivery can be costly – nearly $10 per package on average because of a shorter timeframe for delivery, which means more time and fuel.
Technology and old-fashioned creativity can help offset those costs, but what’s inside the package matters as well when it comes to generating happy-arrival moments. Here are five ways online companies can do it.
1) Proof of delivery. Many online retailers alert their customers when a package is delivered, giving the customer peace of mind and sharpening the crucial last-mile delivery moment. There are various methods. Amazon AMZN -1.3% sends a photo of the package at the door; Imperfect Foods texts customers when the delivery is on its way and noting how may stops before arrival. The return-on-investment for these alerts can be high, because the technology doesn’t have to be costly. Driver-tracking apps (thanks, Uber UBER -0.3%) make proof of delivery easier, are relatively affordable and can improve delivery efficiency by testing faster routes and/or rerouting in real time.
2) Free gifts and samples. This common practice can be expanded upon to elevate delivery to a VIP moment as well as to manage post-pandemic overstocks. The online beauty retailer Exclusive Beauty Club goes for VIP by nestling its free samples in an eye-catching golden satchel (beneath a 20%-off postcard that shouts, “Hello Gorgeous!”). A grocery seller can “gift” a free package of a product already ordered, which, in addition to building loyalty, can help reduce overstocks. The maker of Cure Hydration drink powder began tucking excess samples into curbside pickup orders at Walmart WMT -1.1%, CVS and Whole Foods WFM 0.0%, and lifted sales. General Mills GIS -2.6% is doing the same at Walmart, Target TGT -2.8% and Kroger KR +1.8%.
3) Delivery forgiveness. More online retailers, including Amazon and Walmart, are issuing refunds on returns without requiring shoppers to ship the items back. In cases when the cost of the product is close to that of free return shipping, this makes financial sense – a return costs nearly 60% of an item’s original price, on average, according to a report by returns technology firm Optoro and the real estate investment firm CRBE. But there also can be cases when a repeat shopper is given the option of refund-without-return simply as a thank you for continued business, as one customer learned with online fashion retailer Shein.
4) Include new products for feedback. Consumer packaged goods merchants can bring online customers closer to the brand by inviting them to try new products and provide feedback. The offer can be made while the shopper is ordering online, so there is an opt-in, or as a surprise in the delivery. The company can then reward customers who provide feedback, via email or dedicated site, with a coupon for that product. The customer has an opportunity to become part of brand development, strengthening ties with the merchant, and the merchant is able to gather the kinds of shopper data for use in developing more relevant products and communications.
5) Take responsibility for problems. In 2019, nearly 15% of online deliveries in urban areas never reached their destinations because of theft or logistical issues. With the increase in delivery volume, the chances of delays, damage and/or mixed-up deliveries is likely to climb. Notifying the shopper as soon as an issue arises, and candidly explaining the issue, will minimize the shopper's insecurity of not knowing where a package is. However, explaining the problem might not be enough – remember that 47% of shoppers said they wouldn’t return to a retailer after just one negative shipping experience. A retail guru once said that service/product issues present the magic moment to show what a brand is about. A different kind of feelings-generating moment, but one that – if solved properly – could make a customer for life. A discount, product replacements or even a full refund could do the trick.
Fulfillment Can Be A Showroom For Service
With online retail orders approaching $1 trillion, mere speed and accuracy are no longer enough to stand apart from competitors. Online shoppers already expect speed, accuracy and fee-free delivery as baseline requirements for their loyalty.
Retailers need to see their shoppers from the insides of their boxes, just as they see them inside their stores. Who says in-store theater can’t extend to other physical brand experiences with a brand? All it takes is reimagining the idea for delivery.
Bryan Pearson is a Featured Contributor to The Wise Marketer and currently serves as a director and strategic advisor to a number of loyalty-related organizations. He is the former CEO of LoyaltyOne.