Mastering the practicalities will lead to delivery perfection
“I’d do more online shopping if only I had a working doorbell,” quipped comedian David Mitchell recently. Indeed, it is laughable that trivial issues like this can scupper what should be a straightforward process of receiving goods ordered online.
By Ian Jindal, experienced multichannel retailer and Editor-in-Chief of InternetRetailing
The e-fulfilment industry is well aware of this, and few logistics professionals are amused by the fact that the ‘last mile’ element of the home delivery model can amount to 50 percent of the total logistics cost . The customer experience at this vital touchpoint is no laughing matter either. A recent survey by Direct Line Home Insurance calculated that over £250m worth of online shopping had failed to reach UK customers in the last year .
Challenges (apart from broken door bells) include traffic congestion, overstretched delivery drivers, incorrect address labels, hard to locate addresses, and of course no-one being at home. This all amounts to big practical – and cost – issues that need to be overcome. Thankfully we’re making headway with parcel tracking, SMS communication with customers, Click & Collect services, pick-up lockers, and designated delivery slots.
Can we say that anyone in retail has mastered the practical side of e-fulfilment yet? Not just delivery, but returns and all the challenges of joined-up, multichannel customer service and stock visibility too? Well the truth is there’s so much to learn in this frustratingly complex business, that very few ecommerce and multichannel retailers have cracked the lot. Plenty have perfection in their sights though.
A recent research report, IREU Top 500, has analysed the European market using six Performance Dimensions to pinpoint which ecommerce players across Europe are leading the field, and which are trailing. You’ll need to read the report for all the in-depth insights, but what I can quickly tell you now is that those retailers who score highest in the Operations and Logistics Dimension include the likes of Interflora, Apple, Sainsbury’s, Asda, Tesco and Carrefour.
What are they doing so well? Interflora punches above its weight with a delivery service that crosses Europe and provides a fast, efficient, personal service. Apple boasts a service for deliveries and returns that is unparalleled. For instance, it offers delivery for free in seven EEA countries and customers can specify the date and time their product arrives. The UK supermarkets are excelling in Europe, offering outstanding options including next day one hour delivery slots, at low prices. These companies, often working closely with highly innovative fulfilment and delivery partners, are setting standards for the industry to aspire to.
In Multichannel Fulfilment it is utterly important to learn from the best. Some takes from the recent eDelivery Conference can be found summarised in these 5 tips for retailers to improve the last mile in their multichannel strategy and drive customer satisfaction:
1. Be flexible
Consumer expectations are higher than ever, especially when it comes to service. They are not willing to accept broad delivery windows that ruin their schedules and prevent them carrying out their daily activities. Retailers should be the ones adapting to customers’ requirements and not the other way round. Providing customers with a variety of delivery options such as express delivery, time restricted delivery slots, in-store pick-up and locker pick-up options, can make all the difference. At the same time, encouraging customers to pick up packages from stores, with the use of incentives and discounts, can help share the cost of delivering an item, saving the customer time and money.
2. Get closer – think strategy
If you have played Risk before you know position is key to reach new territories, customers in this case. Analysing your territory and positioning your distribution centers (DCs) and warehouses in the right places will improve delivery speed and reduce costs. Big retailers like Amazon for instance make a point of covering territory to speed their processes, with 96 warehouses in the US and 13 fulfilment centres in the UK. Of course, not all retailers can afford to have as many DCs as Amazon; but for those small retailers, quality and not quantity will always be the winning option when it comes to fulfilment perfection.
3. Have your Plan B ready
Get it right when you get it wrong by always having a Plan B, C and D ready. Solutions to problems are the way to increase customer satisfaction even when you haven’t got it right in the first place.
4. Keep talking
The ability to communicate is one of the basics in human behaviour and it is a breaking point in the shopper/retailer relationship. Talk to your customers before they contact you and keep them informed, even when something goes wrong. Reliability and trust are the foundations of customer loyalty.
5. Measure what matters
Using the right metrics to track your performance will define your future results and development. Delivery speed, parcel size, damage claims and network efficiency do matter in multichannel fulfilment.
Learning from the leaders
Throughout the eDelivery Conference, taking place on 11th October in London, trailblazers like the IREU Top 500 shared their experience and discussed how they are achieving what they do. Speakers from M&S.com, Amazon, Wayfair, Asda, Ocado and John Lewis shed light on various aspects of their supply chain and fulfilment operations, highlighting how practical solutions are being found.
More insights and developments for the multichannel retail and S.O.L.D. industry will be presented next year at the eDelivery Expo, co-located with the InternetRetailing Expo, on the 5th and 6th April at the NEC in Birmingham.