Last-Mile Delivery Impacts on E-Commerce Brands

Online shopping is on the rise, and it has been estimated that it will make up 30 percent of retail purchasing by 2024. The coronavirus (COVID-19) pandemic has accelerated this growth — as e-commerce gets bigger, so do the demands and expectations of digital consumers.

For customers, last-mile delivery and returns have become increasingly important, especially at the online checkout, as a company’s policies and performance directly influence their decision to purchase again — if not purchase in the first place. As research shows, online retailers that offer customers a second-rate experience or think a one-size-fits-all approach is good enough do so at their peril — such practices can end the purchase before the customer has clicked “add to basket” as well as diminish the likelihood of a second purchase.

Given the competitiveness of the e-commerce space, consumer preferences have grown increasingly important. Delivery and returns have become a key differentiator between brands, so seamless last-mile service can make a company stand out against competitors, especially on online marketplaces with direct competition.

It is easy for retailers to focus on fast and free delivery, believing it’s the most important delivery mode to stay ahead of competitors. However, what customers really want is choice. They are looking for different delivery options so they can choose one that causes the least disruption in their day-to-day lives.

To meet such expectations, retailers must provide a menu of options in a range of prices. These include:

• Delivery day/time options: the next day, or for a specific day or time window
• Store pick-up — click and collect — options.

Providing these options at checkout can mean the difference between a completed sale or cart abandonment. According to the IMRG UK Consumer Home Delivery Review 2019/20, a survey about consumer satisfaction with online delivery, 45 percent of customers say they will abandon a purchase if there is a lack of convenient delivery options. The survey was conducted by London-based IMRG retail insights company in conjunction with Global Freight Solutions (GFS), a multi-carrier shipping and e-commerce company based in Horsham, West Sussex, England.

The last mile affects more than the initial sale. It also can impact repeat sales. The GFS-IMRG survey found that 60 percent of customers would buy again from a retailer if they had a good delivery experience. Getting the last mile right increases customer loyalty and helps companies grow business.

Some other considerations:

Don’t let returns get left behind. Retailers tend to focus on delivery, with returns an afterthought, which can lead to customers having a poor returns experience. But returns are just as important as delivery to consumers, and they should be seen as part of the full last-mile experience. According to the survey, 78 percent of consumers consider the quality of a returns service when choosing where to shop, and 85 percent of consumers have a preference of how they would like to make a return. Focus on a seamless and easy returns process, to ensure you build customer loyalty through returns as well.

Keep communication constant. Customers appreciate visibility between checkout and delivery and, if a return is needed, back again. A simple tracking number is no longer enough; customers want real-time tracking and notifications so they can be continually aware of their order’s deliver status. Incomplete information risks the customer having a negative experience or getting frustrated with having to chase down the parcel.

Therefore, it’s also important to let customers know of any delays to their deliveries before they contact you. Accurate and transparent tracking not only helps the customer; it cuts down on customer-service queries that take time and resources. According to IMRG, the majority of customers want confirmation that their return parcel has been received and transparency regarding a refund or new item. Companies must adapt to this level of communication and upgrade their technology for consistent and reliable tracking.

Outsourcing last-mile logistics. This measure can help companies (1) cut business costs, (2) take pressure off their warehouses and (3) improve customer experience. Multi-carrier delivery solutions offer the ability to work with a variety of carriers and get the best rates, thus enabling you to offer customers more options and better costs. You also can choose carriers based on speed and efficiency, with options to switch carriers depending on capacity. Some companies also offer return solutions.

Strategies like multi-carrier delivery solutions, constant communication and transparency, delivery and return options, and positive experiences can help e-commerce companies improve the last-mile experience, stand out against competition — and keep customers returning.