Study Finds Expectations Not Being Met in Ecommerce Delivery

Mike O'Brien

June 30, 2017

Retailers can increase revenue by offering more shipping choices for shoppers, according to a new report from Temando, which also revealed a wide gap between consumer expectations of ecommerce delivery and what retailers deliver.

The report also found that the quality of the ecommerce delivery experience is a major contributor to customer loyalty, with 73% of consumers saying they’ll shop more with brands if it’s positive, while 50% of them won’t buy again if it’s negative.

“Our research shows that shipping remains a key driver of cart abandonment,” said Carl Hartmann, co-founder and CEO of Temando. “If the range of consumer expectations are not met, or the cost of the experience is not in alignment with expectations, then inevitably that translates to a missed opportunity for the retailer. By closing the gap and providing more of a range of experiences, retailers can create more revenue.”

For instance, the survey found 43% of retailers drove increased revenue by offering better choices in ecommerce delivery. Among enterprise retailers, 33% reported a reduction in cart abandonment rate when offering more shipping choices, while 50% of mid-market retailers experienced increased sales. Also 27% of small retailers reduced their carrier costs by offering new shipping choices.

A number of the findings highlighted how rapidly consumer expectations are rising, in large part driven by Amazon, and how difficult it is for merchants to keep up. For instance, 59% of survey respondents said they’d buy from a brick-and-mortar store if they felt the online shipping charge was too high, while 66% said the high cost of shipping doesn’t match the experience delivered. Also, 54% reported abandoning their online cart based on shipping cost, and 39% said they did so when no free shipping was offered.

The report was based on a February survey of 1,300 consumers and 270 retailers in the U.S., which was conducted by Research Now.

“The missing piece for many retailers is a solution that balances customer experience-friendly shipping with automation and efficiency,” Hartmann said. “Shipping is truly the last frontier for commerce, and retailers who master the use of technology to optimize the process are giving themselves the best chance to not only survive, but thrive in these trying times.”

Some other findings from the report:

• Shoppers are willing to pay up to $18 for same-day delivery and up to $19 for international shipping, and 65% would increase the size of their order to qualify for free premium shipping
• Only 31% of retailers offering email tracking updates with their ecommerce delivery, while 78% of shoppers said they want it
• Returns influence conversion, with 43% saying they would shop more online if offered free and easy returns
• Retailers are struggling to find a profitable model for premium delivery services and as a result, retailer adoption has slowed. While 53% of them offered same-day delivery in 2016, that figure dropped to 29% this year. Similarly, 34% of retailers offered weekend/after-hours delivery in 2016, dropping to 25% in 2017