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How delivery options impact dropout rates for online retail

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Delivery of products is something that is often a bit of an afterthought for marketers, but new research shows that convenient and efficient delivery options are actually a highly influential part of the buying process for consumers.
online retail

Is delivery really a marketing problem when it comes to online retail? Oh yes, says Sam Jarvis – research shows customers are increasingly sensitive to a good delivery experience.

Online marketing professionals everywhere will be all too familiar with the process of trawling through mountains of data, scrutinising every potential drop-off point in an attempt to improve conversion rates. We examine every page, button and call to action to achieve marginal gains that will add up to more sales.

Delivery of products is something that is often a bit of an afterthought, or is just part of the process that operations departments or customer services teams should worry about. However, according to new research (the MetaPack 2016 State of Ecommerce Delivery Consumer Research), convenient and efficient delivery options are actually a highly influential part of the buying process for consumers.

Is delivery really a marketing problem?

The report states unequivocally: “Delivery…options and experiences are affecting customer buying decisions more than ever.” It outlines statistics that show customers are increasingly sensitive to a good delivery experience and that the delivery experience impacts, both positively and negatively, their decision to buy from a particular online retailer.

The study is based on an online survey of shoppers in the UK, Europe and the US, and it highlights some remarkable statistics:

  • 43% of consumers said that, following a negative delivery experience, they would not return to that e-retailer within a month
  • 38% of consumers said they would never return to an e-commerce shop after a negative delivery experience
  • 45% of customers had abandoned a basket online because of unsatisfactory or unavailable delivery options
  • 61% of customers said they’d picked one e-retailer over another because the delivery choices offered were more attractive
  • UK shoppers were among the most likely (68%) to shop with a retailer again after a positive delivery experience

Are delivery options impacting your bottom line?

In a competitive market with increasingly web-savvy consumers, it perhaps should be no surprise that previous research told us that 56% of UK customers rate choice of delivery options as the most important factor when deciding on a purchase. Considering the vast combination of choices in products available online, that noteworthy statistic goes some way to illustrating how seemingly minor details can have a huge impact on the shopping experience.

But let’s look at those numbers again. Nearly half of all customers say they have chosen to shop at one particular online store based on the products they offer, only to decide against completing their purchase at the last minute because of a lack of delivery choice. Just imagine how much that equates to in lost revenue, not only for the initial purchase, but also the number of repeat customers that store is likely to be losing.

How can e-retailers stand out from the crowd?

We already know that differentiation in a competitive, crowded market is crucial for online retailers. The challenge is: how to differentiate? There are an almost infinite number of projects and campaigns that e-retailers can spend their time and budget working on to try to grow their business, so where should they be directing their energy?

All the latest research seems to indicate that getting delivery right is absolutely essential for the long-term success of an online retailer. Interestingly, one such study seems to indicate that it is one of the areas where customers aren’t particularly price sensitive, with many willing to pay a staggering six times more for the delivery option that is most convenient for them.

So what delivery options are likely to make the biggest impact for retailers? Natalie Berg, Retail Insights Director for Planet Retail, has some thoughts:

“Click & Collect will continue to bridge the gap between online and offline retailing. Our own research shows that half of global shoppers are now influenced by a retailer’s ability to offer convenient collection points for online purchases. Click & Collect is no longer a nice-to-have, it’s now a prerequisite.”

Blurring lines between online retail and offline

Consumer expectations have now shifted. Flexible shopping experiences offered by retail giants like John Lewis, IKEA, Asda and Next mean customers now expect to be able to shop online and pick up in store, or shop in store and get goods delivered to their home. All of these market leaders now offer Click & Collect, so it should come as no surprise that an estimated 76% of online shoppers will use Click & Collect for a purchase in 2017.

So what is it that appeals to consumers: convenience or speed? Actually, it seems both are very important. Nearly half (47%) of consumers in urban areas say they want a one-hour delivery service, while the vast majority of all consumers expect a same-day option, which plays into the hands of online retailers with a High Street presence.

How can independent retailers compete with High Street giants?

There is clearly a challenge for retailers who sell online. How can they provide the kind of convenient delivery options their High Street competitors offer without upending all their current fulfilment systems? Retailers are often tied into specific couriers and have already invested in establishing robust processes, so adding or changing a courier to implement Click & Collect could disrupt operations.

Similarly, the integration of any solution into a retailer’s check-out process must be seamless in order to prevent damaging the existing check-out experience. Some leading online retail stores have reportedly paid as much as £10 million to build their website, so adding in a plug-in with poor appearance and user experience could potentially ruin their prized asset.

online retail articleThese are two of the challenges that were flagged up again and again when we at HubBox talked to retailers, so we conceptualised a nationwide Click & Collect solution that did not require upheaval of e-retailers’ fulfilment processes. Our service enables customers to select from a choice of more than 1,000 Collect Points when checking out at a retailer, providing improved choice and convenience to the customer and allowing online retailers of all sizes to offer Click & Collect just like the retail giants.

The future for online retail

For many online retailers, attracting and retaining customers is more difficult – and more expensive – than ever before. Customers are decreasingly loyal, so giving each individual customer exactly what they want is absolutely essential for sustainable success in ecommerce. Investing time, money and effort in an exceptional website with wonderful products only to lose customers at the last hurdle is simply not tenable, so offering absolute convenience for the customer is now what will set savvy retailers apart and lead to long-term success.

Author: Sam Jarvis
Founder at HubBox |

For further information about the Click & Collect service, HubBox, click here. 

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