Inbound Logistics | January 2023

FREE SHIPPING IS THE #1 DRIVER FOR CONSUMERS TO COMPLETE AN ONLINE PURCHASE not come back to the website.” Platforms like Locus calculate optimal nal-mile routes, in turn helping shippers procure their desired service levels. Retailers have a shopping cart’s worth of last-mile delivery options. n rst-time buyers make up a higher percentage of orders,” he says. “If it’s a bad experience, that customer might

store nearby has a few of them left over,” Kline explains. “That becomes distressed inventory because the retailer has to mark it down 40% off to move those coats. “If someone in New York is looking at three more months of winter, they might order the same coat, at full price online. The retailer just made back 40%.” Even without the added expense and planning of traditional distribution networks, ship from store comes with details to iron out, cautions Kline. Sales associates must be trained—and nd the time—to pick out and package items for shipment on top of their existing job duties. And stores might have to be retrotted to accommodate additional activity, especially if they lack an adequate back room. DELIVERY WINDOW SHOING As e-commerce grows in popularity, the delivery experience has become foundational to shoppers’ perception of a brand. In The Last Mile Mandate , a June 2022 survey conducted by FarEye, 85% of consumers said they would not shop with a retailer again after a bad delivery experience, while 88% of shoppers reported abandoning an online cart because of poor delivery terms. One way to avoid that outcome is to tailor the delivery experience to a customer’s preferences.

There are several ways to accommodate customized delivery. One is self scheduling. Ryder, a third- party logistics provider based in Miami, built the RyderView platform that allows consumers to schedule two-hour delivery windows for white-glove orders. Shoppers receive shipping updates via a means of their choosing, and they can reschedule deliveries through the RyderView app. “RyderView is meant to create the type of experience that the consumer is looking for,” says Jeff Abeson, vice president of last mile at Ryder. “One person taking a delivery might prefer a text and they can press that link and schedule right online. Someone else may prefer to get an email or a phone call.” Coordinating customers’ preferred delivery windows adds a layer of complexity to nal-mile operations. And poorly coordinated routes can compromise service levels, risking the odds of an unsatisfactory delivery experience. “Retailers struggle with guring out how to lock in capacity to deliver on service level agreements,” says Walter Heil, senior vice president of developed markets at Locus, a Wilmington, Delaware-based last-mile logistics platform. “Especially during peak season,

Customer service Reviews Brand anity

I don’t know Knowing the exact date the order will arrive Other

Free shipping Fast delivery Price

Source: Fabric survey of general merchandise retailers, brands, and consumers BRANDS RECOGNIZE THAT FREE SHIPPING IS OF CRITICAL IMPORTANCE FOR CONSUMERS What are the top drivers for consumers that help in conversion to purchase?

FREE TWODAY SHIPPING IS ALREADY TABLE STAKES FOR CONSUMERS How much do you think you should spend on an online order to get free two-day shipping?

76% of consumers expect free two-day shipping if they hit a minimum spend of $40

Free shipping

Customer service

Price

Brand anity

Fast order delivery

Reviews

Other

25%

50%

75%

100%

Spend up to $20

Spend $20 - 40

Spend $40 - 60

Spend $60 - 80

20%

40%

60%

80%

Source: Fabric survey of retailers, brands, and consumers

Source: Fabric survey of general merchandise retailers, brands, and consumers

170 Inbound Logistics • January 2023