It may not be the most glamorous area of e-commerce, but shipping and delivery is a fundamental part of the online buying process and underestimating its importance can have a detrimental effect on the success of your business.
Why is shipping and delivery so important?
Get your shipping and delivery strategy right and you are rewarded with increased levels of customer satisfaction and loyalty. Get it wrong and you risk reducing your profit margin, alienating customers and damaging your brand image.
Customers expectations rise as they become increasingly web savvy and research findings repeatedly tell us that delivery has a direct influence on a customers buying decision.
According to research carried out on behalf of MetaPack:
- 68% of potential customers abandon online sales at the delivery page
- 42.5% of customers look at the delivery pages first
- It costs 10 times the cost of the original delivery when a delivery fails first time
More food for thought…
Research findings from a recent ComScore White Paper on behalf of UPS found that although 83% of respondents were happy with online shopping overall, some of the lowest satisfaction scorings were in the area of delivery and returns.
In addition, a IMRG UK Home Delivery Review 2013 found that:
- 74% of consumers said that a good delivery experience would encourage them to shop with again with a specific retailer
- 75% would like access to clear delivery information prior to purchase
- 80% would like online tracking
- 78% would like the ability to choose a specific day for delivery
Five best practice tips to help meet customers expectations
When planning your shipping and delivery strategy, spend time thinking about each of the areas of best practice suggested below and see if they can be incorporated into your shipping and delivery service.
1. Shipping rates
Make sure you are offering shipping and delivery rates that the customer deems fair. Getting the prices right for your market is essential.
“The setting of shipping fees have a dramatic effect on both conversion rates and profitability” (Internet Marketing, Chaffey et al, 2009)
Rates can be varied for the length of time it takes to deliver. For example checkout Amazon’s list of delivery options. Amazon offers seven different shipping rates with costs varying depending on the time it takes for delivery. Customers can take advantage of free super saver delivery shipping if they are willing to wait 3-5 days for delivery, pay a premium for next day delivery or take advantage of Amazon Prime – Amazon’s loyalty programme where customers pay an annual fee to qualify for free next day purchase.
Know your product delivery costs – find out exactly what the costs are to ship a product and make sure you check what your competitors are offering. With a bit of research you can offer shipping rates that keep your customers happy and your profit margins where they should be.
2. Free shipping
76% of online shoppers would like to see free shipping options at checkout (UPS ComScore research)
It is not always possible to offer free shipping on items, however wherever you can you should try to offer the option. Customers are often willing to wait longer for something if it can be delivered for free (think Amazon). If you can’t offer a permanent free shipping option then think about using it as a sales promotion technique. For example, ‘spend £50 or over and get free delivery’ or a time limited offer such as ‘free delivery this week only’. If free shipping is really out of the question for your business then think about offering ‘real time’ delivery – where customers pay exactly what you have to pay to ship products.
Make your returns policy clear and as customer friendly as possible. Returns are always a bit of a pain, so try to make it as convenient as possible for a customer to return your item. For example, offer free returns with a pre-printed, postage-paid returns label that the customer can simply peel of and stick back onto to the original packaging. Think about signing up to a returns service such as Collect + where customers can drop their parcel into a local shop rather than having to go to the post office.
Try and be as flexible as possible with your delivery options. We’ve all experienced the frustration of waiting in all day for a delivery. Where you can offer flexible delivery instructions that can be passed on to the delivery service such as, leave in garage, leave with a neighbour, leave behind the bins and so on. Where the customer has to be in to take receipt of their order then think about offering options where the customer can pick a delivery day, or a morning or afternoon time slot. Put yourself in your customers shoes and think about what kind of options you’d like.
Keep customers informed about the status of their order. People like to know when their order has been processed and is out for delivery. Implement delivery notification emails with shipping tracking references. Not only do you keep your customer happy, you are also cutting down on potential calls to your customer service department. So when choosing your delivery service and shopping cart software think about whether they offer these options.
Shipping and delivery is a critical part of your online business, so keep your customer in mind and research your market. And remember one size doesn’t fit all – have a shipping and delivery strategy that reflects your own individual business requirements.
We’d really love to hear your thoughts on this post, so please do leave a comment.