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Retailers and brands must differentiate in order to survive
Mid-market ecommerce retailers and brands must differentiate in order to survive against the considerable might of Amazon, Alibaba and eBay. This was the urgent message from Patrick Wall, founder and director of MetaPack, in his keynote speech at The Delivery Conference in London last week.
“The only way retailers and brands can avoid the dangerous middle ground in the ecommerce sector is to drive a distinct proposition. This can be based on cost, or differentiation based on specialisation, range authority, brand loyalty, design or experience.”
– Patrick Wall, founder and director of MetaPack
Patrick added that that the three main marketplaces were predicted to dominate up to 40% of the ecommerce market by 2020 and this was echoed by Sir Ian Cheshire, Chairman of Debenhams.
“Amazon looms extremely large in our market by thinking differently and driving change. They are a player with a commitment to innovation which is quite extraordinary, and as retailers we have to add value and work out where to focus, where to invest and where to be flexible.”
– Sir Ian Cheshire, Chairman of Debenhams
Couriers and personalisation
Couriers are picking up the mantle with a raft of new services aiming to assist retailer in differentiating their experience. There has been a profound move within the industry from a focus on the parcel and moving boxes from A to B and instead putting the emphasis on the customer and tailoring the delivery experience around their life.
There are many ways that carriers are aiming to serve customers better from extending delivery hours into the evenings and weekends, to offering differing options for when the customer isn’t at home such as safe places, collection shops and leaving parcels with neighbours. However what it all comes down to is a lack of data and knowledge about the customer coupled with a drive for better communications. For instance, if a courier attempts to deliver mid afternoon several times and the customer is never at home, it’s likely that they won’t be home mid afternoon next time they have a parcel but to date few couriers capture this data in a manner in which it can be utilised to adjust future delivery events.
Yodel and CollectPlus, Hermes and Royal Mail all told Tamebay how they are working to enhance deliveries to enable retailers to differentiate their offerings in 2018.
Yodel already collect around 40,000 pieces of data a week from customers through their ‘Have your say’ feedback service which are being used to influence how they provide their services. Neil Ashworth, CEO at CollectPlus and CCO at Yodel points out that whilst the high street have now had Sunday shopping for 22 years, consumers are still prevented from acquiring goods on the day they want them due to lack of weekend and evening delivery options.
Adrian Harris, COO of Yodel has described the goal to be a ‘Boringly reliable’ courier service and this has nothing to do with being boring but everything to do with the consumer almost being unaware of the efforts the couriers go to in order to ensure parcels arrive safely with a complete lack of fuss and bother.
You can read more about Yodel and CollectPlus in our interview with Neil Ashworth.
Hermes have for a number of years been investing for the future and will roll out a new website and a new mobile app to compliment their new Rugby hub, pay and print in store offering and photo and GPS delivery confirmations. They also have a new IT system being rolled out and it’s all coming together to extend the value focused proposition that they are known for to also offer a premium experience.
The premium experience that Hermes will offer is all tailored around the customer experience with new notifications, inflight redirections and one click returns. The aim, Hermes UK CEO, Martijn de Lange explains, is to delight consumers and retailers alike with the ‘WOW’ factor and what will differentiate Hermes in the future is their belief that premium services shouldn’t cost the earth.
You can read more about Hermes in our interview with Martijn de Lange
Royal Mail are growing their Tracked and Tracked Returns services at an incredible 31% year on year and as with all couriers are hypersensitive to the customer and how to personalise the delivery experience. That’s why in 2018 you’ll see a raft of new delivery notifications including the day before delivery and then on the day of delivery an expected delivery time window which over time will be narrowed as the service becomes established.
This is all been made possible by their investments in hand held PDAs which power their new system of Track and Trace. To further personalise the delivery experience there are new retailer branded notifications – 7 retailers are already on the programme for nationwide branded notifications and more will follow as this becomes more widely available.
The PDAs will also keep customers better informed when they’re not at home when a parcel is delivered – photos of safe places and names, house numbers and signatures if a parcel is left with a neighbour will all be captured and passed directly to the consumer so they’ll know before they even get home and find a ‘While you were out card’ on their doorstep exactly what time their parcel was delivered and where it was left.
You can read more about Royal Mail in our interview with Roger Morris, Head of Royal Mail Parcels.
What should retailers and brands be looking for from deliveries?
The delivery choices offered to consumers directly reflect on the retailer and the customers impression of them. If the delivery experience is flawless and returns, if needed, are a seamless integrated experience then customer retention will be higher with repeat purchases. Sadly, the opposite is also true and whilst a consumer might blame a particular courier for a less than optimal service a reluctance to buy from the same retailer in the future is natural.
Choices are ever growing and retailers as Patrick Wall points out marketplaces are already capturing a sizeable percentage of ecommerce sales. Amazon in particular in the UK have built their own logistics offering in addition to utilising the best of third party courier services and to compete with this retailers have to delight their customers.
Carriers are already working to assist retailers, for instance in their new mobile app, Hermes will even be able to enable consumers to correct addresses without any retailer intervention necessary. Yodel with their Xpect Returns home collection service aim to make the process of returning an item as simple and familiar as a delivery. Royal Mail are to make receiving a parcel a branded experience.
Retailers now have a dizzying array of services personalised to the consumer to choose from and it’s likely that no one single solution will be the right fit all of the time. To assist MetaPack rolled out their Delivery Intelligence tool offering real-time, accurate and actionable data and highlighting delivery exceptions giving retailers an early opportunity to intervene if required.
2018 is going to be a pivotal year for the carrier industry as the leading couriers offer ever more personalised services and those who traditionally offered value based carriage now start to compete with couriers operating at the premium end of the market. The one thing that’s certain however is that the delivery experience is just one part of how a retailer can personalise and tailor the entire customer experience but it’s also the part of the buying journey which is starkly highlighted and likely to be long remembered when things go wrong.
Choosing multiple partners who can offer the experience the customer desired along with technology solutions to monitor the delivery, enable intervention when needed, enable the consumer to custom tailor their delivery on the fly and keep them informed in advance through notifications will be crucial in order for retailers to differentiate themselves and stand out from their competitors.