The outbreak of COVID-19 has turned the online sales ecosystem upside down, with a monumental upturn in sales. E-commerce today is booming, catapulting online stores to new heights. E-retail revenues are set to reach $6.54 trillion by 2022, as more and more retailers and entrepreneurs start moving online.
In our research, we found that 65% of consumers will be buying online more frequently over the next 12 months, with 20% telling us they’re expected to only buy online within 5 years. There’s clearly a massive opportunity here for challenger brands to capitalize on the huge increase in online custom. Unfortunately, while most brands are aware of everything they need to do on the front-end in the race to attract direct sales, few seek to address the operational complexities that lie beyond the buy button. That means that when it comes to delivery – many online brands are failing.
Let me add context here – since the start of the pandemic 61% of consumers have experienced some problems buying from brands online – with a quarter of shoppers having been let down by an online order since the crisis started.
Delivery reliability has created a crisis of confidence amongst some consumers. 48% of US buyers now say that online deliveries take longer to arrive since the crisis, and 38% of UK shoppers agree.
It’s not a stretch to say that today’s e-commerce market is fraught with fulfilment issues, and these widespread errors and delays mean shoppers are missing out on vital deliveries, leading to greater levels of disappointment and mistrust in online shopping.
Online Demand Is Causing Costly Errors
As consumers move online, vendors must process increased demand of online orders more quickly – and that can lead to mistakes. If you’re running out of stock or shipping to the wrong addresses on a regular basis, these mishaps are often down to ineffective workflows or human error.
For online brands, these delivery mistakes will not win you any favor with customers – it will quickly erode their trust in your brand and you can count out any repeat business. Post-Covid, maximizing customer lifetime value is going to become even more essential. Recently, we’ve seen data supporting the value of retention vs. acquisition like improving customer retention 5% increases profits by up to 95%.
We know that post-purchase experiences, from delivery to returns, have a major influence on customer loyalty and retention – and it is these scenarios that should be being addressed over the next 12 months. To further that point, in a poll by Brightpearl, we found that 77% of all 1-star reviews were related to issues with deliveries, like delayed goods, or items being shipped to the wrong place.
With that in mind, optimized delivery strategies must be top of the agenda for fast growing brands. With online sales set to continue growing, revamping your e-commerce delivery strategy to make online deliveries faster, more reliable, and more flexible could provide that competitive edge that both attracts and retains customers over the long-term.
Spilling the Secret Sauce
When it comes to online delivery, the top-performing retailers all have something in common. They consistently meet -or beat- customer delivery time expectations and react rapidly and seamlessly to changing consumer needs or spikes in demand.
These brands understand they’re competing with the big players in the yard. That means Amazon, and they are prioritizing fast, reliable delivery and fulfillment as being of the utmost importance.
The top performers are exceeding expectations and are able to remain competitive because they have an automated delivery strategy in place. They are closing the gap via fully automating sales orders, stock updates, distribution decisions and more. Thus avoiding human error and increasing the productivity of the operation as items are moved out of the door more quickly. When it comes to shipping speed – automation can improve this exponentially, allowing a brand to present itself as a true viable alternative to the giants.
New Era – New Solutions Needed
Fast delivery, guaranteed order fulfilment, and excellent customer experiences are now the bare minimum for online retailers. Brands should fully expect that altered expectations and interest outside of traditional ‘peaks’ are the new normal – and businesses must be aware of their requirement to constantly evolve.
Understandably, many retailers have been struggling with the logistics of heightened demand and reduced operational capacity. For retailers to meet these challenges head-on, whilst delivering on their service promises, e-commerce firms must improve their digital retail infrastructure and streamline operational processes as much as possible. I would encourage companies to take the time to use feedback as a way of identifying weak points in the end-to-end customer journey and how the pandemic impacted their organization.
By taking the strategic steps to streamline operations, fast-growing firms can maximize the opportunities created by our current environment. I believe that superior DTC models based around agility, extensibility and speed are now emerging that will cut into market share and, with time, will become the new market leaders. But, have no doubt, their successful consumer-focused strategy and exceptional online delivery models will be built on top of strong foundations – and accelerated use of automated workflows.
Derek O’Carroll is the CEO of Brightpearl. Brightpearl is a retail operations platform for retailers and wholesalers with a clear mission to automate the back office so merchants can spend their time and money growing the business. Brightpearl’s complete back office solution includes financial management, inventory and sales order management, purchasing and supplier management, CRM, fulfillment, warehouse management and logistics.
Delivery stock photo by fizkes/Shutterstock