Every year we report how ecommerce sales have driven significant growth for retailers. As the competition for customers increases, the delivery service retailers offer has become ever more important in order to help them stand out from the crowd.
Customers value convenience and choice, so over the last decade retailers and logistics partners have responded by offering services such as click & collect and collect+, while also reducing the timescales for home delivery.
Nominated day delivery in action
In the last year, brands such as New Look, ASOS and Boohoo have gone a step further in the quest to offer services that put the customer first, offering precise delivery in partnership with DPD. The service allows customers to select their own delivery date. DPD then contact the customer via email and SMS allowing them to select a one-hour delivery window between the hours of 11am and 5pm that is convenient to them.
Speaking at the Metapack Delivery Conference last month, Duncan Kendal, supply chain director at Wickes described how Wickes customers’ requirements have changed with speed and precision the new norm. Wickes has partnered with On The Dot to provide same-day or nominated-hour delivery for 70% of its product ranges. On The Dot picks up the product and couriers it to customers for a charge of £9.95.
John Lewis Partnership recently appointed Virtualstock to implement its supply chain management system ‘The Edge’, which will completely transform how online orders are fulfilled. ‘The Edge’ allows retailers to direct online orders to any designated point for fulfilment; be that a physical store, warehouse, distribution centre or 3rd party supplier. John Lewis can then send the details of an online order to be fulfilled from the nearest store with available stock, reducing delivery costs and the time it takes for the order to arrive with the customer. Today’s consumers want greater choice, rapid dispatch and reduced delivery costs, and this system will enable them to offer this.
Putting the customer first
66% of consumers reported having bought from one retailer in preference to another due to superior delivery options, and while 50% of shoppers say they are likely to abandon their basket if a free delivery option isn’t available, 50% are willing to pay for a more convenient delivery option.
Summit’s own research from the 2016/17 Scorecard report showed only 12 of the top 50 UK retailers offered day and time delivery slots. With many retailers now reporting 60% of site traffic coming from mobiles, do we expect busy, on-the-go customers to wait all day for a delivery?
Retailers offering precise delivery have seen their customers respond positively, and they are reporting uplifts in average basket value and average order frequency. Matt Rogers, director of delivery solutions and inbound supply chain for ASOS, said, “Precise is another first for ASOS and a huge leap forward on our customer focused delivery proposition. Our customers love getting their deliveries quickly and tell us they want control and choice over how and when their parcels arrive. Precise gives them exactly that.”
Setting these systems up requires significant capital investment but the return for brands is improved brand loyalty and retention rates, which ultimately improves sales.
How can all retailers get better?
For smaller brands or retailers with legacy logistics and warehouse systems it may be harder to implement technology and processes that will allow you to offer these services. Incremental steps can be made by shortening the timescales for home delivery, offering next day delivery and premium evening delivery, sending delivery updates by SMS and using partners like Doddle, Collect+ and Hermes ParcelShop.
Ultimately, the technology and partners are out there for every retailer to respond to the change of consumer mindset. Delivery innovation may not be as exciting as trialling new marketing technologies, but if retailers keep moving it to the bottom of the to-do list they will quickly lose customers to the retailers who do.
In 2017, every retailer should be putting the customer first. Flexibility and convenience are expected by customers, and they will vote with their wallets if the options are not available.