Shipping and delivery: what customers expect from online retailers

Technology research company World Wide Worx recently produced a report on the growth of internet access in South Africa — including projections for the remainder of this decade. The results provide a clear indication of where retail spend is heading:

• In 2010, 6.8m citizens had internet access with 3.6m engaging in online shopping activity.
• In 2014 expectation is that 5.3m shoppers will engage online (from an estimated 15.6m who have access).
• In six years the two curves move significantly closer to each other, with digital participation set to top 17.2-million by 2020 — this from an expected 20.5m connected citizens, representing an anticipated increase in online shopping participation of 300%+ over the next five years.
• Projected revenue generated in 2014 will be a shade under R6-billion — nearly triple that of 2010.

Clearly retailers who have (to date) not considered providing their clients with an online option need to urgently reconsider their position. They need to do so not only in the delivery of a reliable online retail platform but also in the strategy they will follow in moving the purchased goods from point A to point B.

It sounds simple enough

Provide shoppers with the right products, right purchasing options and quick, reliable delivery (coupled with an acceptable returns policy) et voila, you have a loyal, satisfied customer that will gladly recommend your business to anyone within earshot.

Right?

In reality companies the world over are struggling to decide what steps must be taken to satisfy their online customers’ expectations – especially regarding delivery and returns policies.

This sentiment is echoed by comments made at the recently held “Online Shopping Behaviour Briefing” event in Johannesburg, as well as results from a study of US customer experiences conducted by comScore*.

Delivery times and Cost impact purchasing decisions

Here’s the long and the short (and the logic) of it:

Free and discounted shipping are cited as key drivers in pushing clients towards making a positive purchasing decision – as are projected timing of delivery, clear communication while goods are in transit and clear communication of a company’s returns policy.

Rating out of 11 possible options (regarding shopper satisfaction), survey respondents were clear as to which aspects of their experience they were least satisfied with.

Coming in for a pasting was the lack of a clearly defined returns policy, followed by the ease of making returns or exchanges, lack of “live help” customer service and lack of flexibility in terms of goods delivery.

What online shoppers want retailers to improve on:

• 58% of respondents wanted retailers to improve their “free” or “discounted” shipping options.
• 42% wanted returns and exchange policies and procedures to be simplified.
• 38% wanted the ability to track the location of their purchase (in real time).

Why shoppers abandon carts

It’s not only shipping costs that play a role here. It is, also the poor communication of those costs — often only appearing right at the end of the journey — that puts shoppers off.

It’s that “surprise” element that shoppers do not appreciate, with 40% of respondents having cancelled a purchase because the handling and shipping costs were communicated too late. Fifty-five percent abandoned their carts because the cost of delivery made the total purchase amount unpalatable.

Interestingly, nearly 70% of shoppers have added items to their shopping cart to qualify for free delivery. They would only do that, of course, if they are constantly kept in the loop as to their “shopping performance” so to speak in relation to qualifying for that delivery.

If for example your current basket value is R260, you need a further R90 to qualify for free delivery (worth R100).

That tends to be a no-brainer for most shoppers and is to the benefit of all involved. The final step then is to accurately communicate what the estimated delivery time would be.

For 60% of respondents this information played an important role in them trusting the retailer. Having the ability to track progress and then, obviously, the retailer meeting those delivery promises made — going some distance into garnering customer trust, repeat business and peer recommendations.

• Side note 1: Mobile tracking is important as customers prefer text notifications with their tracking number, text alerts when their package will be delivered and the ability to track their delivery via their phones.
• Side note 2: Most shoppers are willing to wait roughly 5 days for goods to be delivered (under normal circumstances).
• Side note 3: Shoppers want the ability to amend their delivery as needed – either to a different time or location, or having the package held for them to collect. Reasonable flexibility is key.

Returns policy

The ComScore survey found that a clearly defined, easy to understand and simple to execute returns policy played and vital role in online shopper satisfaction.

In addition to the above graph, 63% of shoppers reported looking for a returns policy before making a purchase, with 62% having returned a product bought online.

Here convenience of the experience plays a starring role, with long delays in receiving refunds or having to pay for the return big no-no’s in the eyes of customers.

Most would also appreciate the inclusion of a returns label on the original package or, at least, access to a label that is easy to download and print.

Conclusion

While the above only represents a high-level overview of what online shoppers want in relation to the delivery aspect of their retail experience, it does offer clear indication of areas that require attention.

Some online retailers such as Yuppiechef.com, Kalahari.com and others have made great strides into eliminating much of the friction that stands between company and customer – however, as South Africa increasingly moves to becoming a connected society much still needs to be done in order to setup the correct channels and satisfy the needs of a rapidly growing online market.

From the development of easy-to-use websites and the personalisation of the shopping experience using data harvested, to the ultimate delivery of goods – the process seems simple enough.

Research suggests however that most retailers have not yet struck a balance between customer satisfaction and operational efficiency.

For those who wish to capitalise on the shift in retail behavioral trends — time is fast running out.

*All graphs taken from ComScore Research Paper