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Today we’re joined by RetailX, a company that specialises in performance research and analysis in multichannel retail.
UK’s retail e-commerce sales surpassed 30% of total retail sales due to the pandemic. To adjust to this surge in demand, more retailers began to offer delivery alternatives to provide customers with a fast, reliable and safe shopping experience.
With that in mind, we examined some popular delivery methods offered by Top 500 retailers in the UK.
Elevated demand for next-day delivery options:
Withe-commerce orders on the rise, the demand for faster delivery services also increased. More consumers in the UK are expecting businesses to offer next-day delivery as they shift to online shopping. Based on RetailX’s data, 57% of the top retailers in the UK offer next-day delivery.
“While the shifting retail landscape presents a major opportunity for brands to broaden their audience, it’s not without challenges. Consumers are coming to expect the same delivery options as they get from Amazon – notably free delivery – from across the retail sector as a whole.” – Peter Martin, Managing Director at SMP, said in an article covered by Retail Times.
However, our findings show that the average domestic transit time in the UK misses the mark at 1.9 days. This could be partially attributed to the shock in the logistics and supply chain industry during the pandemic, as average transit time peaked at 2.7 days during the lockdown period. Nevertheless, we believe this may change as transit times start to normalize and as retailers place more emphasis in e-commerce delivery experience.
The rise of alternative delivery methods like collection points and click-and-collect options
54% of UK’s top retailers offer click-and-collect as a delivery alternative. The efficacy of this delivery method is also evident from our data; 97% of parcels delivered to collection points are successfully picked up.
Click-and-collect as a delivery alternative has been growing in popularity even before the pandemic Expecting to to double by 2025 in the UK.
An online survey by SaaS provider Qudini found that 46% of UK consumers were more likely to use click-and-collect for essential stores such as grocery or pharmacies during the pandemic. The convenience of collection points allows consumers to opt for a convenient and safer option to collect their parcels.
Upcoming holiday season, combined with the e-commerce boom resulted in a 29% surge in parcel volumes
During the Christmas season last year, there was a 29% surge in parcel volumes.
In December 2019 alone, UK consumers reportedly spent £52.79 billion on holiday shopping. Looking back at the e-commerce boom in the first half of 2020, this holiday season is expected to set new records for online retail sales.
British Retail Consortium (BRC) has also started encouraging consumers to shop early this holiday season to spread the demand amid the pandemic. Retailers on the other hand, are also preparing for the peak season crunch time by offering delivery alternatives like BOPIS (Buy-Online, Pickup In-Store). With 21% of the top retailers in the UK already offering free delivery for all orders, will more retailers follow suit to encourage British consumers to shop more this Christmas?
Redelivery costs fell due to fewer missed deliveries.
Research by IMRG and NetDespatch in 2019 found that deliveries in the UK cost the industry more than £1.6 billion yearly. Fast forward to 2020, more people are staying home and are able to receive their deliveries. With less missed deliveries, we should similarly see a drop in the number of redeliveries made this year. Indeed, our data shows that 93% of parcels were successfully delivered at first attempt.
Supporting this finding, RetailX’s data shows that 13% of retailers offer nominated-day delivery service in the first half of 2020. Offering this service is also a great way to reduce the number of missed deliveries, and therefore the cost of rearranging deliveries.
Fireside Chat with Arne Jeroschewski, CEO & Founder of Parcel Perform and Martin Shaw, Head of Research at RetailX
RetailX is a research company that specialises in performance research and analysis for retailers and brands, sectors, markets, tools and people in multichannel retail and direct-to-consumer digital commerce. RetailX’s mission is to provide the data, analysis and insights to build successful and profitable businesses.