Why Is The First Delivery Attempt Critical For Retail?

Why Is The First Delivery Attempt Critical For Retail?

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  • Post last modified:December 3, 2020
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Mastering the retailer’s last-mile delivery is key to winning or losing customers.

Deliveries completed in the first attempt not only provide a superior last-mile experience to customers but also help avoid incurring additional costs.

Listed below are all the reasons why the first delivery attempt is critical for retail businesses and how a last mile delivery optimization software can help.

  1. Helps Reduce Extra Costs:
  • In retail, successful first delivery attempts can reduce costs involved in executing multiple deliveries (for the same order), storage of packages, and management of delivery personnel.
  • The follow-on cost for a second delivery is equivalent to delivering three packages and amounts to increased costs. That is why e-commerce and Third-Party Logistics companies must ensure delivery on the first attempt.
  • A delivery that is unsuccessful in the first attempt incurs extra costs on rescheduling the delivery, informing the customer, and adding the delivery in a future delivery round at a date that suits all parties.
  • For the retailer, first attempt failure means: 
    • Late final delivery to end customers, thereby increasing the risk of customer dissatisfaction
    • More time spent on managing the dialogue with the customer
    • More miles traveled, meaning more fuel costs
    • Need for storage space
    • More greenhouse gases emitted before successful delivery
    • Penalties levied to e-commerce players for not fulfilling terms and conditions
    • Reduced profit margins (Increases in second delivery volumes will negatively affect the overall profitability of the retail business)
  1. Improves Customer Experience and Retention:
  • With one-day deliveries becoming the norm, customer experience is the new differentiating factor for retailers, and last-mile deliveries are the critical touchpoint for the same.
  • An improved first attempt delivery success rate is a win-win for the customer, delivery executive, and the service provider while enhancing customer experience exponentially. 
  • By improving First Attempt Delivery Rate (FADR) in various aspects, such as delivering the package on customer-preferred time windows and providing live ETA via a tracking link, retailers can ensure a delightful customer experience. A fast last-mile delivery service that delights consumers goes a long way in attracting and retaining customers. 
  • Research also indicates that if deliveries are unsuccessful in the first attempt, or if customers receive an incorrect or late delivery, then over 15% of customers may give up shopping with a retailer altogether. So, faster delivery services can ensure higher customer retention.
  1. Increases Customer Loyalty, Engagement, and Spending:
  • As more and more consumers are shifting to online ordering, they are increasingly looking for faster and more frequent deliveries. Therefore, last-mile delivery in the first attempt has become a critical service-level expectation and a “must-have” feature, particularly for food and grocery consumers.
  • Research shows that three-quarters of consumers are willing to spend more if they are satisfied with the delivery services. While 74% of satisfied consumers intend to increase purchase levels by 12% with their preferred retailer, 53% are willing to purchase a paid membership for delivery services.
  • So, offering faster last-mile delivery services to consumers brings the following benefits to retailers:
    • Increased customer loyalty
    • Customer willingness to pay higher delivery charges for quicker delivery
    • Higher average monthly grocery spend by consumers
    • Increase in purchase order size
    • More purchases at a higher frequency
    • Added cross-sell and up-sell opportunities for the retailer
    • Higher chances to sell exclusive memberships to consumers
  1. Increases Consumer Endorsements:
  • Research shows that 82% of satisfied customers share positive delivery experiences with their friends and family. This endorsement helps retailers attract more customers.
  • An efficient and timely last-mile delivery service can increase free word-of-mouth recommendations for a retailer.
  1. Helps Gain Competitive Edge:
  • With expectations increasing and consumers gravitating towards faster delivery options, organizations that provide a superior last-mile experience, including first attempt deliveries, gain a competitive edge over their peers. 

So, if retailers can potentially achieve all of the above benefits, then why not get the order delivery right in the first attempt?

First attempt delivery success is not as easy as it sounds! Last-mile delivery comes with unique challenges, such as:

  • adverse traffic congestion
  • wrong addresses or addresses that are impossible to find
  • wrongly transcribed access codes or telephone numbers
  • vehicle capacity imitations
  • driver shortages
  • limited route knowledge of delivery personnel
  • difficulty in parking or strict parking regulations
  • customer not at home or not reachable at the time of delivery
  • unavailability of the right equipment to unload the order at the point of delivery

How Can a Last-Mile Delivery Optimization Software Help? 

An end-to-end last-mile delivery optimization software can help increase the success rate of first delivery attempts by automating the entire delivery operations, including:

  1. Automated order processing and tracking
  2. Dispatch planning and backend automation for delivery 
  3. Dynamic automated routing to intelligently plan routes for delivery
  4. Mapping any delivery package to the customer with only time of delivery and location
  5. Automated Vehicle allocation and utilization
  6. Automated asset tracking, alerts, and notifications to both shippers and consumers, thereby improving visibility from end-to-end and reducing the risk of first delivery attempt failures
  7. Live tracking link for customers to know accurate ETAs 
  8. Automated inventory and warehouse management 
  9. Enabling delivery through autonomous vehicles, drones, and self-service lockers
  10. Enabling customers with automated order management with features like autocomplete and validation of address, selection of preferred delivery time windows, rescheduling delivery, and canceling orders on-the-go, etc.
  11. Electronic proof of delivery (EPOD) to complete the entire end-to-end order fulfillment process
  12. Insights and analytics to monitor and improve delivery performance

Conclusion:

Given the above reasons, ensuring successful last-mile deliveries to customers, right in the first attempt, is now more significant than ever for retail.

Unified fleet management and delivery management system can help retail businesses to optimize cost, efficiency, productivity, and safety by leveraging location technology and innovation.

So, are you ready to implement a real-time last-mile delivery optimization software to ensure successful deliveries to customers in the first attempt?

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