In the age of thriving e-commerce, consumers are facing more freedom of choice than ever. There's the endless range of goods, the simplicity and comfort of one's home, the instant dopamine of impulse purchases. There's one common exception though — the delivery experience they get.
Consumer behavior trends show that delivery is more likely than not to affect the joy of online shopping. We've all been there — expensive rates, faulty tracking, missed deliveries. You simply don't know when exactly the courier will knock at our doorstep. Most likely as soon as you decided to step out for a moment.
No matter the quality of your products and an enticing website, a bad delivery experience will affect the general feeling consumers have towards your brand.
"For e-commerce stores, your online store is what draws your customers to you, but your shipping strategy and execution is what brings your customers back for return purchases," James Green, owner of Cardboard Cutouts, says. "It sounds simple, but it's actually quite complicated and requires you to put time and effort into developing a great delivery strategy for e-commerce."
The inconvenient truth about delivery convenience
"Typically, the delivery offer belongs to the checkout process — something consumers reach at the end of the shopping journey," Piotr Zaleski, CEO and Co-Founder of Ingrid says. "However, many consumers shop based on the delivery experience. They want to know which products and which merchants offer the most convenient, cheapest and fastest delivery option — all before reaching the last step."
Doing business the opposite way commonly results in shopping cart abandonment. Imagine an excited customer going to checkout only to realize that the available delivery option won't be an option for them. At best, they decide to go with it and anxiously wait for an undetermined home delivery. Would the consumer re-order the product again? More commonly, they drop out of the checkout process without completing the order.
According to data, online cart abandonment remains as high as 69.5%. You're missing out on 70 out of 100 potential orders.
What consumers really want is an effortless, dynamic solution at each step of the delivery journey. It's the easy checkout process, intelligent last-mile flexibility and an accurate delivery promise that make it a success. And it's not the speed that counts for a great delivery experience.
You need to be focusing on 'when', not 'how soon', as well as helping your customers feel in control of the process by letting them choose a preferred method of last-mile delivery services.
E-commerce delivery options that fit
Preferred means dynamic — consumer habits, seasons, item specifications and estimated delivery times are some of the factors that determine which delivery method works for a specific purchase. Again, it's 'why', not 'how soon'.
To end this pain, e-commerce delivery has already started transforming into an area with highly differentiated, data-driven delivery pricing and last-mile solutions, which are overtaking product pricing and stock as the primary brand differentiators.
Amidst rapidly growing global competition and evolving consumer expectations, strong e-commerce delivery strategy boosts customer retention and repeat purchases — key assets to set up an e-commerce business for long-term success. Online brands are now able to increase checkout conversion and average order value (AOV), lower the cost pressure of logistics and actually make some profit on deliveries, which has not been the case for many years.
It's time for the industry to pick up the trend and change the delivery strategy for e-commerce in line with the increased consumer standards
What to consider when building your delivery strategy
There's no one-size-fits-all delivery logic that can solve all existing pain points in e-commerce. That being said, you're not beholden to one solution at the exclusion of another. You can have the best of both worlds by using delivery in a way that benefits both the customer and your business.
Rates and costs
"Salaries and the costs of products are big expenditures for any merchants, but delivery costs are also there," Anders Ekman, Co-Founder and COO of Ingrid, says. "In the last six months, those have been increasingly more important for merchants to keep an eye on. Many of our clients have seen a huge uplift in their sales during COVID-19, though now the trend's coming to an end. It's an adjustment to normal levels, which requires e-commerce companies to focus more on revenue than growth."
If you're not sure where to start, consider your associated shipping costs and combine multiple delivery rates and methods to find the best fit for your company. One frequent rate structure would be to set a free delivery criteria for a certain shopping cart value, combined with a fixed delivery rate across all products, if they are fairly similar in dimensions, or groups of products.
Based on your AOV, for example, you could charge a flat rate for orders under 50 EUR to get the delivery costs back and provide free delivery for orders over 50 EUR. If your typical order size is 30 EUR, this strategy may be advantageous. It encourages your consumers to swap delivery fees for additional items in their carts.
"Merchants are going to try to get more of the delivery costs back. They'll start charging more for deliveries and they will start experimenting more with a free shipping criteria. It's a solution that can address both sides of the coin — cutting costs and boosting revenue."
Create an even better delivery experience by investing in intelligent integrations with local carriers. Evolving consumer expectations put an increased demand on e-commerce to offer the most convenient last-mile solutions while at the same time lowering the cost-pressure of logistics.
Adapt to consumer locations, depending on people's life patterns and seasons, be it in a big city or at a summer cottage in the countryside. They need to be offered the best delivery options possible, both affordable and reliable. To do so, you always need to think about adding more carriers and negotiating the best deals to deliver your orders on the consumer's terms no matter where they are.
Entering new markets and scaling your business is a lot easier when you’re integrated with the best local carriers. Be local globally, as we say at Ingrid.
According to Calloway Cook, President of Illuminate Labs, order fulfillment and delivery management are one of the most time-consuming aspects of an early-stage e-commerce business. "I do believe that managing order fulfillment in-house makes sense until the business is profitable, but as soon as the business achieves profitability one of the first investments should be in an outsourced 3PL provider."
However, there are other avenues available to e-commerce brands of any stage.
The key to executing a flawless delivery strategy for e-commerce
That's where e-commerce merchants need to start integrating with the right software to suggest real-time, most cost-effective and convenient delivery options for every purchase and location.
End-to-end solutions like Ingrid Delivery Platform connect merchants, carriers and consumers to create a better shopping experience that fits people's lives.
We enable merchants to achieve sustainable growth with seamless multicarrier integrations and personalized brand experience from checkout to delivery. Our smart solutions give you more control over your delivery management operations and help you turn them into a competitive advantage.
Even if you don't yet have an IT-team in-house that’s capable of integrating more delivery options in the checkout, we support our clients in carrier API integration to reduce complexity and save time.
Our products and business logic create smarter results at all stages of the customer delivery journey.
- Conversion-optimized checkout — offer fast and flexible delivery options to let your customers choose what works best for them
- Advanced order tracking — build trust with e-commerce order tracking that begins instantly after the purchase
- Easy transport management — manage all your delivery orders in one, cloud-based transportation management tool
- Fast store-to-door delivery — Use brick-and-mortar stores to your advantage and send orders even faster with store-to-door solutions
E-commerce delivery strategy example: Nudie Jeans
Some of real-life examples of successfully executed delivery strategies include Nudie Jeans, a Gothenburg-based sustainable denim brand. They ship to over 50 countries worldwide. To start offering the best delivery options in each area and reduce carbon footprint at every step of the delivery journey, Nudie Jeans needed the right tech solution they could integrate with various systems they already had in place.
"As an SME company with our main Department of Commerce in Northern Europe serving a global market, it’s a challenge to provide fast, cost-efficient and sustainable deliveries to consumers. Our volumes are not big enough to enable fulfillment from local DCs in every market." — Maria Johansson, Chief Operations Officer at Nudie Jeans.
With Ingrid In-store solution, they have been able to leverage their brick-and-mortar stores into local warehouses and fulfill web orders directly store-to-door. Not only has it shortened the delivery time, but also contributed to lowering the greenhouse emissions through more sustainable delivery options for every purchase made. Read more about the results Nudie Jeans achieved with Ingrid.
Since we have a store network, we saw the possibility to go more local and utilize store capacity, lower our operating cost, increase customer satisfaction and, most importantly, lower our carbon footprint. With Ingrid’s help, we were able to make this happen."
E-commerce delivery strategy example: Adlibris
Adlibris, Nordic’s largest online bookstore, has spearheaded book industry development for decades. Staying on top of the game in a competitive landscape is part of the dexterity that has gained Adlibris their huge client base.
Handling great order volumes requires a solid logistics process. Having faced the challenge of keeping the customer satisfaction high without high delivery costs, Adlibris saved 10% of net delivery cost using the Ingrid Checkout.
"Through Ingrid's checkout optimization we are able to create the best possible delivery experience for all customers, while benefiting from both conversion uplift and lower net delivery costs." — Nicklas Törnqvist, Supply Chain Manager at Adlibris.
Ultimately resulting in an even better delivery promise, larger consumer base and stronger customer loyalty, Adlibris position as market leading pure-play remains unthreatened
We are moving towards a delivery-first society. Shopping online should be as simple and convenient as possible. Merchants need to reduce consumer anxiety and provide a much better shopping experience through intelligent choice of delivery options — every time, for every purchase.
Trying to give your e-commerce delivery strategy a boost? Book a demo to find out more about Ingrid.