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How to compete on delivery and returns in ecommerce

By: Paul Durkin

Retailers, suppliers or service providers working elsewhere in the supply chain; we are all ultimately at the mercy of the customer and their growing expectations.

But the only reason shoppers have come to expect so much, is because so much is possible.

This article will explain how to maintain a positive customer experience, even when things go wrong with delivery.

Expectation and reality

Glowing box

The online shopping experience no longer ends at the final ‘click’. Customer satisfaction relies as much on the ease of delivery and returns as it does on the product itself.  The need to demonstrate a brand’s seamless delivery and returns capabilities at the point of purchase has never been greater.

With pureplay ecommerce retailers like Amazon having set the bar so high, shoppers now expect to have their purchase delivered when they need it, where they want it and, more often than not, for free. And this is the case whether they buy from an online retailer or from a high street brand.  What’s more, if the goods are not suitable, customers want to be able to return them and be refunded quickly, at their convenience and, again for free.

And the cost of failure has certainly never been higher. Reputational damage from negative reviews, social media posts and word of mouth gives shoppers reason to browse elsewhere. 

It is fair to say that a retailer’s brand reputation is as much about how they deliver and take goods back as how they sell them.

Returns fulfilment 

As the number of online purchases grow, so too does the number of returns. A great returns process is a crucial catalyst for the success or failure of a retail operation.  But for returns to be a positive differentiator, they must be swiftly processed, with stock recycled and customers reimbursed, ready to make their next purchase.

This is where it gets tricky.  A “buy anywhere, return anywhere” culture is raising a host of logistical challenges for retailers and their logistics partners. Returns are unscheduled and haphazard by nature.  They are complex to process; they may need investigation (think product recall or manufacturing fault), sorting, recycling, repacking or reworking to maximise the retail value of the returned product.

When a product is returned, what happens next? Does it go to the warehouse to be resold? Or to the supplier for repair?  Is it damaged and if so, can it be recycled or donated to charity? Or sold in an outlet? And from a financial perspective, on which department or store’s profit & loss account does this now sit?

It is only when a retailer has access to complete visibility of their delivery and returns network, and subsequently the answers to these questions, that they can improve the effectiveness and efficiency of the operation.

From supply chain to dynamic network

Retailers need a robust fulfilment capability to meet customer demand for increased choice and flexible delivery and return options; from warehouse, through carrier, to the point of delivery and back again. A traditional model of a retailer handing off to a carrier has done the job until now. But changing expectations require scrutiny of the status quo.

A supply chain is far more than a linear sequence of events.  It is no longer simply a relay race where products pass from manufacturer, to logistics company, to retailers and finally the customer. The logistics model is evolving to be less of a chain and more of a connected and dynamic network.  An ecosystem if you like.  And it is digitisation which will enable it to operate as such.

What were once slow, manual, paper-based processes can now be conducted at lightning speed through a succession of screens and cloud-based applications relaying information around the world.

Through the advent of the Internet of Things, we have the potential to give all devices and products in the supply chain a ‘voice’; the ability to identify themselves, and their surroundings and transmit that to their handlers. It is this visibility of where products are, where they have been and where they are going that enables their handlers to make informed decisions.

With the data that they need at their fingertips, retailers and their carrier partners can then work collaboratively to make fulfilment function efficiently and cost effectively, communicating with the customer every step of the way. 

Only then can they be in a position to meet the levels of service shoppers are yearning for. Retailers’ concerns over putting their brand (and their customer) in the carrier’s hand can be alleviated.  This collaboration changes the very nature of the relationship – combining to generate a great delivery and returns experience will boost both brands exponentially.

Communication

A customer experience can still be a positive one, even when things go wrong.  What we want as shoppers is for our suppliers to do what they say they will do, and when they say they’ll do it.

Keeping shoppers in the dark is not an option. If retailers want to delight their customers, frequent and accurate communication is essential to making the delivery and returns element a success.

Again, the key to this is collaboration.  As far as the customer is concerned, their relationship is with the retail brand alone – not with other parties in the supply chain who are responsible for managing the returns process. 

So, to support this, behind the scenes there needs to an open and effective communication channel between the supplier, the retailer, the carrier, the end customer and back again. It is the visibility of where the product is in the network and the ability to keep the customer up to date with its progress that will help to set expectations and drive a positive customer experience.

Delivery drivers as brand ambassadors

Man fixing sofa

Technology alone cannot solve the returns quandary.  It is the skills of the people delivering (and collecting) goods which makes all the difference, particularly with big ticket items. And we have seen evidence of this in our work with major high street brands.

The role of the delivery driver is changing.  What was once a simple drop off now often extends to product installation, assembly and in some cases, repairs. The delivery drivers — whom we refer to as ‘delivery technicians’ —  are taking the retail experience into the home. They are an extension of the retailer’s brand, an ambassador and ultimately a salesperson.  

Picture this: a major high street retailer is delivering a leather sofa.  The pre-arranged delivery is fulfilled by a crew of two technicians who transfer the product into the customer’s home.  The customer spots a scuff on the leather, they’re disappointed and request a return (not ideal as it had been bought in time for guests arriving at the weekend).

Instead of returning the sofa to the van, the technicians (on the agreement of the retailer and the end customer), repair the scuff in the home.  It takes a matter of minutes, a return is avoided, the customer is happy. 

With the right training and experience, these delivery technicians can prevent a return, upsell a product, deliver a positive customer experience and support brand loyalty and repeat custom.

A customer dissatisfied is a customer lost

In the ecommerce world deliveries and returns are, without a doubt, a key differentiator.

Over time, we will see retailers and carriers increasingly working together to solve the challenges posed by a complex supplier network, whether this is in a literal or technological sense.  They will have to, to survive.

By harnessing data, exploiting the benefits of digitisation and adopting a culture of collaborative working, carriers and retailers can not only move to meet customer expectations, but be in a position to anticipate them.

By Paul Durkin, Director of Home & eFulfilment, Wincanton

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