Free and next day delivery are the biggest influences on consumers’ purchasing decisions, but merchants are failing to meet these needs according to research, The Retail Expectation Gap, undertaken by Parcelhub and Brightpearl.
58 per cent of consumers said that free delivery would make them more likely to shop with a brand and would be more tolerant of longer delivery times when delivery is free. The majority (40 per cent) said that they would be happy to wait for up to a week, with only 11 per cent expecting free delivery on the same or the next day.
However, when it comes to paying for delivery, 45 per cent of consumers said the options of next day delivery would make them more likely to shop with a retailer. This was more than double the number who said the same for 2-day delivery and of click and collect, also at 22 per cent of consumers.
For retailers, understanding these expectations enables them to enhance their delivery offering to increase sales. So far, 34 per cent of merchants surveyed do not offer next day delivery and are missing out on these potential sales. Those who have invested in Order Management Systems (OMS) or Delivery Management Platforms (DMP) are in a better position to offer next day delivery as the delivery option availability rises to 74 per cent and 73 per cent respectively, thus enhancing their ability to complete a sale.
Although (73 per cent) of merchants believe they are offering enough delivery options, one-third do not offer next day delivery, the most popular option for consumers. The same issue exists when considering the top five delivery options that consumers would like to see in terms of in-flight delivery options. With many retailers not currently offering these delivery options this presents an opportunity for them to differentiate against competitors.
Retailers that have invested in technology are more confident in meeting expectations because they can offer more choice. 85 per cent of those using an OMS feel confident in the options offered, compared to only 67 per cent who do not use an OMS. Among those using a DMP, 87 per cent feel confident in their delivery options offered compared to only 62 per cent who do not use a DMP.
For SMS notifications, 58 per cent of those using a DMP support this feature today, compared to 33 per cent of retailers who provide SMS notifications but who do not use DMP. Similarly, 29 per cent of DMP users already support the 2-hour delivery window option, which drops to 7 per cent of retailers who support this option but do not use a DMP.
Speed of delivery is also absolutely critical and almost half of retailers agree that they feel that they lose customers due to missed or delayed deliveries. Speed of delivery is highest among OMS and DMP users. For example, in the fastest click to delivery window bracket (2 days), 50 per cent of retailers using an OMS and DMP fell into this category, which dropped to only one-in-five retailers who are not using an OMS or DMP.
Similarly, retailers using a DMP are also faster at delivering to customers, as 40 per cent of retailers in this category report an average delivery time of two days or fewer compared to 22 per cent among those who do not use a DMP.
The survey also reveals how those using DMPs are also much more likely to be considering new delivery options. For example, ‘1-hour delivery window’ and ‘nominate a new day’ are both under consideration by 67 per cent of DMP users. This compares to only 25 per cent who are not using this technology. ‘Picture at the door’ is similarly being considered by 67 per cent of DMP users compared to only 17 per cent not using; and two thirds are also evaluating the option to amend delivery preferences up to point of delivery. This compares to only 8 per cent of those who are not using a DMP.
Steve Marjoram, managing director Parcelhub, said: “The world of eCommerce has undergone a lot of changes and new hurdles in the last year. Retailers need to invest in their order and delivery management to overcome the challenges and to ensure that they can be adaptable and flexible, as well as offering an experience after the buy button that matches the expectations of the consumer.”