This is a guest post from InPost.
Online shopping in the United Kingdom is booming, with consumer expectations and behaviours playing a pivotal role in the shape and pace of eCommerce.
Yet, despite many innovations and enhancements in the customer experience, such as 'try before you buy', the use of virtual reality and AI-powered personalisation, conversion still reigns as one of the greatest challenges for e-retailers, with basket abandonment rates still averaging at 76% and a staggering £18bn lost on potential sales in the last year.
Consumers expect a seamless journey and stellar customer service from the moment they land on your online store to the point of unboxing their items, and whilst a sizeable proportion of basket abandonment can be attributed to downfalls in the user experience and price comparison, it’s actually failed expectations and dissatisfaction around the delivery options on offer that will see half of them go elsewhere.
For the shoppers that do convert, a smooth and positive delivery experience encourages customers to shop again and more often, hence improving their lifetime value. A poor delivery experience, however, can have the opposite effect, with 55% of consumers saying they’d go elsewhere after a bad experience receiving their items.
In this article, we discuss what today’s online shoppers want when it comes to their delivery options and provide recommendations to help you convert and retain your customers.
What are the delivery deal-breakers?
Given the significant number of shoppers being deterred from making a purchase at the final leg of their journey, delivery is a chance for you to differentiate from your competitors by giving them what they really want.
eCommerce is renowned for empowering the consumer to seek out the best possible deal, and, arguably, the same rule applies where delivery options are concerned.
The cost of delivery has a major influence over purchasing decisions. Of those who abandon their basket due to delivery, almost 70% do so because it is too expensive.
In fact, free delivery is rated as the most important consideration for shoppers when making an online purchase, with 95% of Brits more likely to make a purchase if delivery is free. More shoppers are also choosing to pick up their items in-store or at their nearest collection point in order to avoid “rip-off” delivery charges.
Similarly, 50% of shoppers claim that a free returns policy is the deciding factor in influencing their purchase decision, believing that retailers should foot the bill.
This behaviour suggests that few are willing to compromise when it comes to the cost of delivery and returns.
The need for speed
In this age of instant gratification, it’s hardly surprising that fast delivery is ranked as the second most important delivery consideration for online purchases.
In fact, over half of online shoppers opted for next day delivery in 2017 and 20% have taken advantage of same-day delivery. For some this doesn’t go far enough, with 54% of urban consumers wanting their eCommerce orders to be delivered within the hour.
With consumers accustomed to getting what they want, when they want it, e-retailers face increasing pressure to meet these demands.
The willingness of consumers to pay for the luxury of faster delivery varies, with just over a third of shoppers being prepared to pay more get their items delivered when and where they want.
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Just as consumers can shop online when it suits them, there is an inherent demand to receive goods how, when and where they want to, in order for their deliveries to fit in seamlessly with their everyday lifestyles.
Failure to enable this can result in these time-poor shoppers going elsewhere, with 60% purchasing from one online retailer over another if the delivery options offer greater convenience.
This means consumers expect to find a variety of delivery options at their fingertips so that they can pick and choose the one that best suits their needs.With readiness to ‘wait in’ for a delivery at an all-time low and anxieties abound over the prospect of a missed delivery, home delivery services alone just won’t cut it anymore.
Instead, shoppers are taking advantage of alternative options such as collecting from a local pick-up point (39%), delivery to the workplace (19%), or a locker (11%).
Affordable, speedy delivery without breaking the bank
Free delivery will undoubtedly help ‘seal the deal’ in checkout, being a major driver of purchasing decisions. Whilst absorbing the cost of free delivery can be an eye-watering prospect, there are a few things you can do to soften the blow.
Offering free delivery on a minimum spend threshold is a popular mechanism among retailers to help maintain margin and avoid losing money on smaller transactions.
It’s also an excellent marketing tool to encourage people to spend more, with 73% of shoppers admitting to overspending to qualify for free delivery.
Another way to offset the cost of free deliveries is by offering a delivery loyalty programme.
By offering unlimited free standard or next day deliveries for a monthly or annual fee, you encourage your customers to shop more with you, thereby increasing their life-time value. The popularity of such schemes is far from abating, particularly amongst millennial's, with almost 70% subscribed to up to seven delivery loyalty programmes.
In terms of reducing the surface cost of your delivery options, last-mile logistics partners that offer click & collect via parcel shops or lockers should be considered.
Generally, these services are able to offer better rates on next day services due to their multi-drop models. This factor also offers more reliability when it comes to achieving the promise of next day.
Offer your customers choice
Online shoppers want to feel in control of their delivery experience, without disruption to their daily routines. One of the main ways that retailers can fulfil this need is by offering a variety of delivery options, including click and collect.
Whilst we can assume that most, if not all, online retailers offer at least one home delivery service, a large proportion still do not offer the option to click and collect from a parcel shop (40%) or locker (71%), despite consumers increasingly opting for these services.
In fact, retailers not taking advantage of these options may be missing a trick.
Click and collect promises an element of convenience to consumers that more affordable home delivery services are falling short of. It also minimises the risk of an anxiety-ridden delivery experience by side-stepping the chance of a missed or failed delivery, thereby improving the retention of your customers.
Keep returns free, simply and transparent
Conquering delivery is arguably only half the battle, with the returns journey also bearing a significant impact on customer conversion and loyalty.
We know that providing paid-for returns has a strong influence over purchasing decisions, so it’s worth advertising it liberally in the buying journey. This will offer reassurance to the customer that if they are dissatisfied with their purchase, they won’t have to pay to change their mind.
In so doing, you are removing a barrier to conversion.
As for the physical journey, almost a third of consumers find it difficult to return unwanted items and over half think the process is too complicated. In fact, over 80% of consumers say that they would shop more frequently with an online retailer that makes the returns process easier, highlighting the importance of a clear and straight-forward returns experience.
Ultimately, customers want to be able to easily locate and understand the returns policy, so they don’t feel like they’re having to jump through hoops to return unwanted items.
What’s more, customers desire choice and convenience when it comes to returns as well, meaning that retailers must think beyond the post office.
Enabling customers to return via parcel shops or automated parcel lockers gives them access to a greater number of locations as well as flexibility on when they can return unwanted items.
This means that they can return on the go without being restricted by regular opening hours, and can benefit from a quick and stress-free returns experience.