Winning the last mile race

The upheavals in the economy are an opportunity for those able to automate many of the processes that are currently tripping up retailers and brands unable to keep pace, says Rory O’Connor, founder and CEO of Scurri.

Time was when all the predictions for ecommerce were that it would grow and grow, to the point where it would take more than 50% of all stores’ sales. Some even predicted the end of stores altogether.

And yet, in 2022, the top came off the graph as the value of online retail sales in the United Kingdom fell from £119.6 billion to £106.0 billion according to Statista. Despite all the reasons given, this was not expected, even allowing for post-Covid customers finally being free to shop in store again.

And ever since then the challenges have piled on, not least the rising cost of operating online which is now on a par with running a store. Other challenges have included, rising competition from home and abroad, data protection regulation, ever more demanding customers, and the difficulties in making plans in the face of unpredictable economic indicators.

The result has been several failures of businesses that depend on ecommerce as a result of competition, poor customer service, rising costs and debts being called in by increasingly nervous banks.

No one is immune; even in the last mile delivery space, bad service highlighted by single star customer reviews can bring a player down. And yet, as this market continues to grow and new entrants emerge, here is proof that there is profit in finding the right balance between good service and operational cost management.

What this means for brands and retailers is that they need to have agility built in. In this way they can ride the changes in the market for the benefit of both themselves – in terms of revenue and profit –for their customers – in terms of giving them certainly on service and delivery; and for the planet – in terms of being sustainable through more predictable management.

In terms of what consumers expect, research of over 1,000 UK adults in our recent Getting personal in the last mile and beyond report reveals that post-purchase and delivery considerations rank higher than ever in their list of priorities.

For online direct-to-consumer (DTC) purchases, the price of the item leads with 70%, followed by shipping cost 52%, trusted brand 46%, shipping speed 40% and ease of returns 37%.

Meanwhile, the top two of five purchasing drivers when making a purchase from a retailer were free delivery – either online or in-store, and free returns – either online or in-store.

This proves definitively that post-purchase and delivery considerations are almost as important as the product itself. However, operating effectively and profitably in this space depends on taking much greater control of the various processes. This is particularly true based on the following evidence just by looking at order tracking.

71% of respondents have more confidence in the tracking and shipping update information if sent directly by the retailer while 69% are more wary of unbranded or third party delivery updates as they think they might be scams – increasing to 76% of Gen Z. 53% say tracking updates should come from the retailer rather than a delivery partner while 53% find receiving unbranded updates from a carrier or courier company confusing as they don’t always know which order it is referring to – increasing to 65% of Gen Z and Millennials.

In addition, 82% of respondents are more likely to open emails from a retailer or brand if they are updating them on the progress of their delivery while 81% will always open these emails from a retailer or brand if they are updating me on the progress of their delivery.

Brands and retailers will get even higher positive customer feedback if they personalise these communications.  55% are happy to receive personalised offers in delivery updates (as long as they can opt out of ongoing brand comms once the item is delivered), while 53% are happy to receive personalised offers in tracking updates (as long as they are not sent too frequently).

44% went on to say that receiving personalised delivery updates gives them more confidence in the brand they are buying from while 42% say receiving personalised offers in updates is a benefit that makes them more likely to repeat purchase. A further 39% say personalised offers in tracking  updates would make them more likely to try new products or ranges from another retailer.

Key to managing the complexity in these communications is having access to a single platform that can control costs, operations and customer experience, all fully customisable, backed by branded tracking communications.

From there, the data gathered from all these interactions, powered by AI, will enable even greater personalisation and continuous improvements that will keep costs down, boost customer lifetime value and enable brands to focus on growth through new channels and territories.

For more key takeaways around how taking control of the post-purchase delivery experience can build greater trust, increase customer loyalty, and deliver increased revenue opportunities, download a free copy of Scurri's latest report Getting personal in the last mile and beyond.

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