Same Day Delivery Expectations are Growing
How can online retailers compete?
By Brendan Heegan, founder and CEO of Boxzooka
Same day delivery has been around for a while – think flowers, Dominos and auto parts. UberEATS, Door Dash and your local grocer expanded the same day food delivery sector dramatically during the pandemic. And, thanks to Amazon, Target and Walmart, people are receiving more than food delivered every day to their front door. In fact, 100 million Prime members in the USA are spoiled with same day options on virtually anything. Forgot a birthday? No problem, let’s see what we can get today!
These heightened consumer expectations make it difficult for online brands and retailers to compete. Most online retailers have a “same day shipping” option with a cut off time for purchases to be packaged and shipped using an overnight ship method (FedEx, UPS, DHL) to arrive the next day. Expensive, but effective and a cost that the consumer can choose.
It is worth noting that a customer may incorrectly view same-day shipping and same-day delivery as one and the same. These mistakes are easy to make, particularly with up to 50% of orders placed on mobile devices these days. It is important to make the delivery promise distinction clear at checkout so there is no confusion. Transparency is a best practice to help build customer loyalty.
Same day delivery options are less common for most online retailers and can be expensive. Amazon Prime is $139 per year – not free, but it feels like it when the option for same day delivery pops up. In major metro areas in the U.S., a handful of same day couriers are available (check Google in your area). In most cases these services cater to high value items with a limited delivery area.
Here are a few of the best practices for online retailers to consider to meet the rising consumer expectations:
Offer fast Shipping or free shipping – not both
E-commerce retailers can offer fast shipping options on every order as long as fulfillment operations are capable of shipping on the day the order is placed. Retailers generally offer free shipping at a price point that makes sense for the order value. Consumers understand these choices and are more tolerant of slower delivery when they get a “deal.” Setting expectations for the delivery date is important and providing an expedited ship method for a premium is a common practice.
Prompt delivery updates and tracking information
Retailers are motivated to provide consistent and reliable updates to order status and delivery updates. Mobile purchases are the routine and naturally demand a steady flow of tracking messages. When presented effectively, order updates and tracking information are positive experiences that enhance your brand. For example, getting your company’s order tracking information via UPS or FedEx does not promote your brand as much as the carrier’s brand. There are methods for presenting tracking information in a window with your branding and messaging.
Retailers that are not providing enough updates can be disappointing customers and opening the door to negative reviews.
Optimized warehouse operations
Managing a productive warehouse operation or having a top tier third party logistics (3PL) service is necessary for meeting the expectations of today’s ecommerce shopper. Warehouse operators must have their buildings optimized for workflow to minimize order processing time and get orders fulfilled accurately. There are dozens of opportunities for leveraging automation in fulfillment operations to streamline repetitious processes for material handling, packaging and shipping. Same-day order processing has become the industry standard which means people, processes and technologies have to work flawlessly every day.
Leverage technology wherever possible
Today’s consumers have high expectations for quick answers, clean websites and apps. Having your technology platforms and partners effectively integrated is important to providing real time updates and positive user experiences. Brands need to be thoughtful about what technologies are integrated into fulfillment and transportation processes to enhance accuracy and speed, including order management systems (OMS), barcoding, artificial intelligence (AI), warehouse management systems (WMS) and transportation management systems (TMS).
For instance, have you considered implementing route optimization software for delivery efficiency? There are several sophisticated TMS options available to help manage the complexity and costs of shipping methods.
Regional distribution centers reduce delivery time and expense
Having your products closer to your customers naturally cuts down on shipping time and expense. For most customers, 3-to-5-day delivery times are acceptable. Distribution centers positioned for East Coast and West Coast order fulfillment can leverage less expensive transportation services and make the delivery promise possible.
There are also several important techniques for managing inventory to optimize your distribution network. Brands with low numbers of stock keeping units (SKUs) can manage split inventory with fewer complications than brands with high SKU counts. The goal is to make sure the majority of your products are fulfilled completely from the ‘local’ warehouse and avoid any split shipments, with one item from one warehouse and one item from another warehouse.
What mechanisms are in place for regular evaluation and improvement of fulfillment processes? How do you gather feedback from customers to enhance the overall delivery experience? Are your operations positioned to scale with the business? Having a continuous improvement mindset is a necessity to keep meeting customer expectations while controlling costs.
Addressing these questions, businesses can develop strategies to not only meet but exceed customer expectations in this world of same-day delivery and information at your fingertips.
About the Author
Brendan Heegan, founder and CEO of Boxzooka, a quality-focused third-party logistics (3PL) provider with great technology, lean operating processes, happy clients and a vibrant culture. Learn more at www.boxzooka.com.