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News & Views

Shipping determines where people shop online

For online retailers, the next great hurdle to customer loyalty is delivery. Next-day delivery has been a standard expectation for years; now a growing number of consumers are looking for an e-commerce experience that includes same-day or even within-the-hour service.  According to a recent study, over half of consumers say that delivery defines who they shop with — and if they’re not offered the right delivery options, they’ll walk.

MetaPack’s 2017 State of E-Commerce Delivery consumer research report, carried out across 3,577 consumers in the US, UK, France, Germany, Spain and the Netherlands, found that 45 per cent of online shoppers have abandoned a basket because of unsatisfactory or unavailable delivery options. And a negative delivery experience has a profound impact on that consumer’s decision to shop with that brand or retailer again; 43 per cent said they wouldn’t return within a month, and 38 per cent said they would never shop on that site again.

54 per cent of respondents in the report said that delivery defines where they shop regularly online, while the same number said that one-hour delivery should be available within metropolitan areas. Interestingly, a large proportion of consumers expressed interest in loyalty programmes and subscriptions; 31 per cent are willing to pay a monthly fee in order to get unlimited next day deliveries, à la Amazon Prime, while 55 per cent would choose an online retailer that offered a delivery loyalty scheme over one that didn’t.

Delivery is an outcome-critical component in the FMCG sector of e-commerce, especially in the UK, where growth is the highest in Europe, but on the verge of stalling, according to Kantar Worldpanel’s Annual Future of E-Commerce in FMCG report.

“E-commerce retailers are bound by the limitations of the current delivery model,” says Fraser McKevitt, Head of Retail & Consumer Insight at Kantar Worldpanel. “Home delivery is the norm for the British consumer, even more so since the growth in popularity of services like Deliveroo. However, this is an expensive option for retailers, and substantial delivery costs are an obstacle to completing orders at the quick turnaround shoppers demand.  This hasn’t stopped retailers innovating to find new ways of satisfying this ‘right here, right now’ mindset, such as one-hour delivery from the likes of Tesco and Sainsbury’s, or Amazon’s up-front Prime Now subscription model.”

Existing delivery models are still working to an extent — MetaPack’s research found that 73 per cent of people purchase additional items in order to reach the minimum spend for free delivery — but refining your delivery offering, and making a greater deal of options available, might be the key to ensuring your customer doesn’t go elsewhere.

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