UK retailers face up to the challenge of more demanding customers

Online shoppers in the UK are a sophisticated lot these days and they have come to expect their purchases to be delivered with seemingly effortless and limitless flexibility.

They’ve moved away from seeing retailers as online ‘bargain basements’ and now view them as stylish, niche and independent traders. This is a far cry from the early days of e-commerce when most people went online to grab a bargain and tolerated much slower deliveries and fewer shipment choices.

Retailers encouraged a change in customer perceptions and increased expectations with sleek websites, multi-channel marketing and social media engagement but many neglected to revamp their delivery and shipping services, which remained relatively inflexible. Temando’s independent research shows, for example, that 89% of UK customers expect to see multiple shipping options in their carts as standard. Where this was once a major point of differentiation, today it’s seen by customers as a basic requirement. However, there is gap in expectations; while 62% of UK retailers do offer this choice, more than one third still do not. Our research suggests that the ones that don’t would be wise to reconsider. Almost three quarters of retailers surveyed reported an increase in sales and 60% reported a reduction in cart abandonment once they offered multiple delivery options.

Unlike the early days of e-commerce, today’s online shoppers also want faster delivery options. This goes some way to explaining the growing demand for allocated time slots across the country. Our research suggests that 86% of UK customers have used or would like to use timeslot deliveries and that 71% of would like guaranteed weekend or after-hours shipping. In both instances, around 40% of customers would be happy to pay a premium for the service.

But customer demands don’t stop there. UK customers also want same day shipping capabilities and are even starting to contemplate options that would get orders to them between one and three hours after checkout. However, many micro and small retailers are still hampered by a reliance on manual back office processes, which makes it almost impossible for them to turn around a 24 hour delivery, let alone a same-day or hyper-local options. Mid-sized and enterprise retailers could potentially speed up their shipment and fulfilment processes by decentralising their warehouse operations and using their stores as fulfilment centres. Yet our research shows that almost three-quarters of UK enterprise retailers aren’t doing so.

One thing is for certain, however. The UK’s retail sector is continuing to evolve and, as our research demonstrates, customers across the country are not going to ease up on their demands for more efficient, stress-free and personalised delivery options. This means, regardless of a retailer’s size, the shipping & fulfilment process has got to be re-imagined as a point of differentiation and, instead of being seen as a cost centre, should now be viewed as one of the most effective ways to fight cart abandonment, strengthen brand loyalty and improve customer service.

By Carl Hartmann, CEO, Temando