Shorter delivery times as a success factor
The e-commerce industry is booming! E-commerce sales have seen extraordinary growth and they have grown even more recently, with the repercussions from the Covid-19 pandemic driving end-customers to shop safely online. Global e-commerce sales rose 28% in June, according to ACI Worldwide, marking the largest year-over-year increase since the beginning of the pandemic.
As this industry grows, it is very important that your supply chain evolve alongside it, in order to appeal to the consumer driven demands. Consumers expect instant gratification and that is pushing faster and faster delivery times. Almost 80 percent of consumers in a recent RetailWire survey reported that free, two-day shipping was important to them while online shopping.
72 percent of customers said they likely wouldn't do business with an online brand after a poor delivery experience.
This consumer driven e-commerce market requires supply chain and logistics companies to focus on processes to speed up delivery times, at the best cost value and ultimately appeal to increasing consumer demands. By being transparent, reducing delivery times, processing orders quicker, driving down costs and being more flexible, companies are able to increase end-customer satisfaction. In the summary below, we discuss ways to create customer satisfaction by using innovative solutions; such as predictive delivery ETA, peak holiday capacity planning, technology and automation.
The customer experience is more important than ever when it comes to customer satisfaction. Predictive estimated times of arrival (ETA), extracted from statistical modeling, are critical for relaying delivery expectations to keep customer satisfied. With an accurately predictive delivery ETA, retailers are able to deliver on their promises to their customers. By capturing points of data directly from carrier partners in order to calculate the ETA, supply chain and logistics companies are more effective in meeting consumer demand. This data can then be analyzed to devise insights, trends, and discussions for better business outcomes to maintain the service manufacturers and brands expect.
The omnichannel strategy has been a critical endeavor to creating a more seamless approach to meeting consumer demand. Supply chain and logistics companies should also offer a variety of payment, fulfillment, and delivery solutions to create customer satisfaction. Reducing delivery times is a key consumer expectation in e-commerce and is increasingly important as logistics professionals strive to stay ahead of the clock. The top retailers and brands, such as Amazon continue to push delivery times to two day, or some to even same day delivery times.
Capacity planning during holiday seasons drives success
The holidays bring massive spikes in sales and shipment volumes over a short period of time. The seasonal peak time, from Black Friday until Christmas, can account for up to 40% of annual sales for many retailers. Proper forecasting, planning, and flexibility is needed in order to meet the surging consumer demand. Obtaining the proper cargo capacity based on forecasts is one major hurdle many fail to overcome during their peak planning. On the opposite end of the spectrum, flexibility to accommodate unforeseen surges in order volume is also a key to success.
Being flexible is one of the most important factors for supply chains because of the ever changing and uncertain essence of today's consumers. By having strategic locations in different regions, supply chain and logistics companies are able to be flexible and offer end-consumers the fastest delivery times at an optimal price.
Rising e-commerce demand and the need for speed drive the need for technology and automation
Technology makes supply chains more efficient. By deploying the correct technology in warehouses, supply chain and logistics companies have the potential to make warehouses more efficient across the board. When you think about e-commerce on a Cyber Monday or a Black Friday, you could have four to five times the order volume, depending on the contract brand or manufacturer, compared to a normal day of deployment. By using technology and automation, supply chain and logistics companies are provided the capabilities to effectively manage and speed up a wide range of repetitive processes.
To sum it all up, the e-commerce industry is growing by leaps and bounds every day and brands and retailers, as well as the suppliers serving them, need to grow even faster alongside it or become extinct. This includes something as big as having a fast processing time to something as small as having your package gift wrapped for the end-customer.
“Something as simple as packaging plays a major role in the peak planning process and overall customer satisfaction. Shipping in a box too large for the goods being transported is not only more costly for both the packaging and the transport aspects but can impact outbound capacity since overall package volume is larger than necessary. In addition, large boxes utilized for smaller items are more susceptible to damage in transit. These damages create a disgruntled customer and a potential bottleneck of returns,” explains Sean Stokes, Director of Transportation and Logistics at Arvato Supply Chain Solutions.
We recently released an interesting new online shop packaging study that goes into the specific details of why packaging is such an important part of the customer journey, especially in fashion and beauty e-commerce. Our Arvato team placed extensive orders with online shops from the fashion and beauty industry and analyzed their packaging, accompanying customer communication on and in the package, and the returns process. The results of this study reinforce why seemingly small details, such as choice of outer packaging convenience to including samples in gift packaging, is so important in creating e-commerce end-customer satisfaction when a package is delivered.