Retailers must deliver on fulfillment to drive conversions, a new study by Arvato reveals
January 5, 2018-- New York, US – A new study has revealed the true cost of delivery to retailers, with more than half (54%) of US shoppers saying they have abandoned a purchase online because delivery was too expensive.
The original research of 2,000 US shoppers by Arvato found that the majority (83%) said free delivery was the most important factor when it comes to fulfillment of online orders, followed by speed of delivery (53%) and free returns (52%).
This rang true for basket abandonment too, with nearly a quarter (24%) of shoppers saying they had cancelled an order because of slow delivery speeds, while 26% said that the product had been out of stock and, with no indication of when it would be available, they decided not to proceed with their purchase or shop with another retailer.
When it comes to fulfillment, 45% said that convenience was the most important factor, with 17% saying they liked to be offered multiple delivery options. 56% of US shoppers already use the ‘buy online pick-up instore’ (BOPIS) option, but while only 11% currently use two hour BOPIS options offered by retailers, 32% said they would like to see more retailers offering one or two hour collection spots for BOPIS purchases going forward.
Ferka Vukel, Director Fashion and Cosmetics at Arvato SCM Solutions, commented: “Delivery isn’t just about fulfillment but an integral part of the decision-making process for the online shopper. Those retailers who are not offering a fast, convenient and, crucially, free delivery service are at risk of losing out. With retailers having to balance the rising cost of fulfillment against the cost of losing an order, there is no easy answer, however one thing all retailers can do is to be transparent, giving customers an estimated delivery cost from the outset to avoid frustration at the end of the shopping journey.”
According to Vukel, the importance of delivery will not diminish over time and may, in fact, become even more significant to buyer behavior in the future.
She explained: “Our research shows that within five years, shoppers expect retailers to offer up increasingly innovative delivery solutions - 7% wanted to see driverless vehicles or Uber drivers doubling up as carriers to get their products to them and a further 17% want orders from multiple retailers to be delivered in one go.”
Amazon’s Prime Air has also captured the imagination with 13% of shoppers wanting to see adoption of drone deliveries from retailers, while 11% wanted ‘drive thru’ collection lockers and 8% even thought that retailers should offer ‘to device’ delivery, where an item is delivered to a customer by using their smartphone or tablet to geo-locate them.
What’s more, 12% would be happy sharing their finger prints with retailers so they can ‘sign’ for deliveries with their finger print for more secure deliveries
“At the moment innovations such as drone delivery are more about capturing consumers imagination than reality, but what we are seeing from consumers is that speed, cost and convenience are imperative when choosing to shop online and that is something that is not going to change any time soon,” concluded Vukel.
Notes to editors:
Original consumer research of 2,000 US adults, conducted by OnePoll for Arvato, October 2017.
Arvato SCM Solutions is a leading service provider in the field of supply chain management and e-commerce. More than 14,000 employees work together to provide practical and relevant solutions and services worldwide. Using the latest digital technology, Arvato develops, operates and optimizes sophisticated global supply chains and e-commerce platforms to measurably increase productivity and performance.
As a leading international full-service omnichannel logistics service provider, Arvato SCM Solutions has worked with world-renowned brands from the fashion, beauty, FMCG and consumer electronics industry for over 15 years. Arvato’s brand-specific service portfolio covers globally integrated supply chain solutions, retail logistics, omnichannel and the entire e-commerce process chain: development of online shops, front-end management, B2B and B2C logistics and shipping including returns management as well as payments and accounting, customer service and e-commerce consulting.
With 63 distribution hubs on both coasts of the USA, plus Europe, Russia and Asia, Arvato SCM Solutions provides the necessary scalability, flexibility and experience to give their customers the decisive competitive edge. Arvato is a wholly-owned subsidiary of Bertelsmann.