The 2021 Dilemma: How to Provide a Great Customer Experience Despite Shipping Delays and Supply Chain Shortfalls
Holiday Hustle to Avoid Customer Hassles
It’s no secret. Retailers in the United States – and around the globe – are struggling to meet customer demand due to supply chain and shipping issues. With record shortages of both goods and labor, and ongoing carrier shipping delays, meeting customer expectations for the 2021 holiday season may seem daunting.
The Hidden Costs of Missing Expectations
But what is the real cost of missing customer expectations? Consider this: a study shows 69% of customers are much less likely to shop with a retailer if an item they purchased is not delivered within two days of the promised delivery date. Further, 14% will stop shopping with a retailer altogether if a package is delayed by even one day.
Maybe you think your customers’ “holiday spirit” will bring you more grace – think again. The abovementioned study shows 86% of online shoppers have even higher expectations during the holiday season. Even if the late package had nothing to do with the retailer and everything to do with the carrier, the customer is more likely to blame the retailer.
A late shipment means much more to your business than an unhappy customer or a critical review. Late shipments directly affect the bottom line of your business. Consider the cost of replacing that lost customer. According to this study, acquiring a new customer can cost anywhere from five to twenty-five times more than retaining an existing customer (numbers vary by industry).
Late deliveries drastically reduce customer lifetime value and return on customer acquisition. Late deliveries also increase your customer acquisition cost. When you lose a customer because of a bad customer experience, negative word-of-mouth can make it much more challenging to find those new customers.
Beyond the added costs of acquiring new customers, unmet expectations cost you in other ways. You may need to hire additional contact center staff to deal with incoming support inquiries. Customers may return items received late. You may also feel compelled to offer discounts or gifts to your customers to entice them to shop with you again.
Crafting Positive Customer Journeys
The importance of keeping your customers pleased with your brand is clear, but you might wonder how to do this when there are factors out of your control. It might be tempting to simply point the finger at your supplier or shipper when issues arise. This approach is not effective and won’t get you out of the “doghouse” with your customers.
If your customer, for example, found the most perfect outfit to wear for their holiday party on your website, of course, they are going to be disappointed, stressed, and angry if the outfit shows up two days after the party. Let’s explore ways to ensure a great customer experience even in the most challenging of times. Craft your customer journey with empathy.
- Maintain consistently clear and proactive communication with your customer. When you can influence your customer’s expectations, you set yourself up for success. For example, if you know your selected carrier is going to be late delivering your customer’s package, it’s on you to reach out to your customer. If you’re uncertain when your customer’s package will arrive, don’t promise delivery by a certain date. You could instead say something like, “we are currently experiencing shipping delays and will strive to keep you informed every step of the way.”
- Customers today demand immediate and easy interactions on their buying journey. Make it easy for your customers to self-serve by providing tracking information in real-time. Your order management system should be equipped to send out tracking updates via email and/or text messages.
- Anticipate your contact center will be extra busy not only with seasonal holiday volume, but also with higher-than-normal shipment inquiries. Equip your customers to serve themselves with self-service portals, chatbots, and voice assistants. Put your customers in the driver’s seat by giving them the option to select the carrier they feel the most confident and comfortable using.
- As a retailer, you can also be proactive in managing customer feedback. Since you understand your customer’s shipping experience might lead them to give you an undeserved product rating, consider injecting some friction in the review process. In other words, don’t make it as easy for your customer to leave you a bad review that has little to do with your product and everything to do with outside factors.
A final word of advice is to remember “UPOD – under promise and over-deliver.” Not sandbagging, this phrase is about being intellectually honest in setting expectations. Your customer’s journey will be much more positive if you inform them upfront that 2-day shipping might actually take 5-6 days because that’s what you have been experiencing with your shipping carrier. This beats the alternative of promising a two-day delivery only for your customer to receive the item a week later. While customers might be initially disappointed when you give them realistic information, they will appreciate your transparency.
Here is a final statistic to consider from the Harvard Business Review: an improvement of just 5% in customer retention causes profitability to increase two-fold. Keeping your customers by delivering a positive experience is essential to the bottom line of your business.
There is no reason the challenges your business is currently facing with supply chain and shipping must ruin your customer’s experience. By using the above suggestions, you instead have an opportunity to create some long-term loyalty with your customer base – a loyalty that will directly enhance your profitability this holiday season and beyond. A gift that keeps giving.