When it comes to building a customer retention strategy for your e-commerce store, it’s natural to think of customer-facing activities like improving customer service processes, building customer relationships and personalizing customer service.

These strategies are valid and should be incorporated into your e-commerce customer retention strategy. But have you thought of looking at other, less obvious but just-as-important areas like your supply chain and choice of carriers?

If not, here’s why you should look at this often-neglected area to improve your customer retention.

parcel perform customer retention strategies logistics

Consumers now expect quicker delivery times.

Fast delivery drives customer loyalty and purchase intent.

Did you know 99% of U.S consumers said ‘fast delivery’ is important when making an online purchase?  In same-day delivery company Dropoff’s study of U.S consumers, 43% of U.S consumers now expect companies to have a ‘much faster’ delivery time in 2018, a 23% increase from last year.

They’re also more willing to pay for same-day delivery services and expect a professional delivery service.

But retailers aren’t meeting their expectations.

According to the same study, delivery providers aren’t meeting these expectations of delivery quality and speed. Consumers are seeing a rise in sub-standard delivery experiences with items arriving damaged or late.

impact of logistics performance on customer retention

Source: Drop-off

And they’re frustrated.

When 43% of consumers say they will never shop with a retailer following a negative delivery experience, they have expressed their expectations to both merchants and carriers loud and clear.

Transparency in the last-mile delivery process drives customer retention

For merchants, the implications are clear.

Your choice of delivery partners and their performance is a direct representation of your brand and customer service values. How they perform during the delivery process reflects on your brand’s service quality and determines whether they’ll come back to you again.

logistics determines customer retention

Source: Drop-off

It’s therefore important to select the right logistics carriers and understand how they’re performing to make informed decisions.

Take note of these delivery metrics of when evaluating your logistics set up:

  • The number of on-time pickup and deliveries
  • Delivery success rate by carriers and country (if you are operating in different markets)
  • How often do unforeseen events and delays happen when your delivery is in progress?
  • Delivery issues your carriers are facing and why they occur

Do you know how well your logistics carriers are performing?

With transparency over your logistics setup performance and when deliveries arrive, you’ll be able to answer customer inquiries more effectively, delight your customers and keep them coming back to you.

When the vast majority of your customers expect proactive updates on delivery status and check it multiple times a day, an understanding of your delivery performance allows you to give more accurate deadlines to your customers and manage their expectations better.

In peak shopping seasons where customers are pressed for time and expect delivery forecasts to be accurate, offering such transparency (and sticking to these deadlines) can determine if your customers stay with you after the initial sale.

In Conclusion: Logistics Transparency Is Crucial In Your Customer Retention Strategy

When you have customers to meet and deadlines closing in, analyzing your logistics setup and carrier performance can be the last thing on your mind.  But, as we’ve demonstrated here, delivery performance has a significant long-term impact towards your customer retention rates.

Do you have transparency on this entire process? Where do you even get started?

Well, fret not. With Parcel Perform’s logistics management capabilities, you’ll have all these information at your fingertips and in a single overview. We provide complete visibility on your logistics setup with all key logistics KPIs at your fingertips. 

Our tools help you drive customer loyalty by helping you proactively stay on top of your logistics updates. Start here! 

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