It's generally accepted that the COVID-19 pandemic simply accelerated the trend towards growing parcel volumes. But it was a bit of surprise how quickly those consumers that were not significant pre-pandemic online shoppers increased their delivery expectations. That, combined with the already heightened demands of long-term shoppers, have really increased the challenges to sellers and shippers. Numerous studies have identified key desired attributes and the ones shown below always at the top of those lists.
· “Free” Shipping – We all know that from the seller’s perspective, shipping has never been and will never be “free”. But from the customer’s perspective, they do not want to pay anything (or any more than they’re already paying, such as Amazon Prime, Walmart+, etc.). Sellers need to look at reduction of any costs that directly or indirectly drive their shipping costs. Perhaps packaging rightsizing to avoid unnecessary dimensional weight surcharges, consolidated loads to shippers, or other process improvements to generally reduce handling costs.
· Timely Delivery – A close second to free delivery is timely delivery. But the definition of “timely” has changed over the last two decades. When Amazon Prime was launched in 2005, even Jeff Bezos referred to two-day shipping as an "indulgent luxury;" now it’s the expected minimum standard. Next-day, same-day, and "I need it right now!" are considered reasonable expectations by many shoppers. Shipping from one fulfillment center to everywhere may no longer be a good idea to meet these new standards. Local micro-fulfillment centers, partnerships with 3PLs, etc. may need to be considered.
· Tracking Visibility – Gone are the days when you placed an order and it just showed up at some point. Now we expect tracking updates from the moment the order is accepted, the shipment is handed to the carrier, and every step until it’s at our doorstep. Sellers need to have a robust internal tracking systems that identifies where the order is within its organization through order release, picking, packing, and shipping operations. Once transferred to the shipper, the seller still should be responsible for proving updates to the customer through a seamless interface.
· Expected Item – This one is often overlooked. Shipping can be free and on-time but if it’s not what the consumer was expecting, it’s a failure for that order and potentially future orders with that shopper. For this discussion, "expected" means the customer got what they wanted in an undamaged condition. The fulfillment operation needs to have adequate quality procedures to make sure that the right item is picked and packed so there are no surprises when it shows up at the customer’s doorstep.
The short story is that it’s not going to get easier for retailers and shippers. However, those that recognize these trends and proactively adopt plans to address them in their operations will have a competitive advantage by driving customer satisfaction.
Jim McLafferty is the Director of Post & Parcel Sales at DMW&H. With over 25 years of experience in the material handling industry, Jim is a thought leader in postal deliveries and parcel shipments, and the equipment and systems needed within a warehouse or distribution center to facilitate package deliveries. He can be reached at JMcLafferty@dmwandh.com or 201-635-3439.