Despite eCommerce having been around for over 20 years, last mile logistics continues to grow in complexity and involves many challenges, including cost minimization, transparency and efficiency.
For typical online shoppers, fast and free delivery has become the norm. Next-day delivery is expected from big retail. But not every customer expects instant gratification. Take collectibles buyers for example; they’re willing to wait, but want free shipping and mint-condition arrival of goods in exchange for their patience.
When it comes to last mile optimization, one-size does not fit all.
The ‘last mile’ is essentially the last leg of a product’s journey, where a package arrives at the shopper’s door. It’s one step of a process a consumer is most interested in.
A package arriving safely and securely at its final destination is a key aspect of quality customer service. On the flip side, last mile problems–such as late deliveries or, worse, not arriving at all–can damage a company’s reputation and therefore its bottom-line.
For SMBs competing against the likes of Amazon and subscription box services, issues involving the last mile delivery can be irreversibly damaging.
They say it costs between 5 to 25x more to acquire a customer than to retain an existing one. So why not put in the time and develop a holistic strategy to keep your customers happy?
To optimize your last mile, it’s important to identify, define, develop, and integrate a solution or program that lead to improvements and overall customer satisfaction.
Improving last mile logistics without breaking the bank seems nearly impossible. Fortunately, there are ways SMBs can enhance last mile logistics and delivery without devoting unaffordable resources.
Related blog: 4 steps to last mile success in eCommerce logistics
Offer an unforgettable unboxing experience
Creating a fun unboxing experience is not only an incredible marketing tool to make customers happier, but it will also help spread the word about your business. Customers love taking photos and videos when unboxing their products and share it on social media.
An unboxing experience also allows you to stand apart from a crowded market and spark positive thoughts about your brand, and therefore your reputation. Also, a thoughtful and well-crafted package can even decrease product returns. It’s like opening gifts on Christmas!
Good communication between a brand and a customer begins the moment clicks the “buy” button. SMBs can send build anticipation by communicating with customers post-purchase, pre- and post-delivery via email or SMS.
Stay in touch with your customers even after the delivery is made – follow up and remind them of their great buying experience with you. Real-time package tracking and proactive updates when things go wrong are equally important.
Keep customers well-informed (and your business top-of-mind) with a confirmation email, coupon offers, reminders to buy again, or to review your product and service.
Continuous communication helps customer confidence in last mile delivery, but also reduce the number of emails and phone calls to your customer support team.
Let Customers Choose Their Delivery Window
Give customers greater control over when their products will be delivered by letting them select a delivery window. Not only is it more convenient for the shopper, but it can help lower costs since the process of looking for parking, the possibility of getting ticketed for double-parking, and vehicle idling are key drivers for inefficiencies and congestion.
Small Parcel Delivery (SPD)
To provide customers with an option for expedited delivery, consider partnering with on-demand delivery fleets or same-day messenger services. Many of them will soon offer “moonshot” initiatives such as delivery by drones and robots. These expedited services could drive stronger customer loyalty with lower prices, especially in megacities where the infrastructure exists to accommodate them.
Large-Item Logistics / Less-Than-Truckload (LTL)
Thought of buying a mattress, sofa, appliance, treadmill or a kayak? You’re not the only one. In the age of Amazon, consumers expect online purchases to be delivered fast and free. But when it comes to oversized items, it’s not so easy – not even for Amazon.
A recent study found that 11% of customers reported wasting an entire day tracking down shipment of an oversized product; another 11% of customers said they fought with customer service while the delivery process unfolded; 15% said they missed work while waiting for a delivery; and 13% reported keeping an item because of an overly complicated return process.
When it comes to large or bulky items, your business will need to consider either:
1. Building a warehouse to house all inventory– from small parcels to large bulky items;
2. Working with suppliers to help with point-to-point delivery;
3. Creating a distribution network or leveraging 3PLs to help with less-than-truckload (LTL) deliveries; or
4. All of the above.
Wayfair stays ahead of the curve because the company utilizes (and leads in) all three arrangements. “Wayfair is able to more economically handle what's called the LTL market, which gets the products to that last mile,” as reported in The Motley Fool.
For SMBs to compete in large-item logistics, consider providing customers with proactive updates on their shipment rather than having to research it themselves. Also consider providing customers with more delivery choices in the checkout page, similar to selecting a carrier (USPS, FedEx, DHL or UPS).
In competitive markets, where the likes of Amazon, UPS, FedEx struggle to provide, partner with transport marketplaces or shipping companies for white-glove service. The service fee is fixed, delivery costs are lower and predictable, and transit times are shorter.
Considering all of these options, you might want to hire a dedicated employee to own the last mile routing process, from defining a vision and creating strategies to executing and delivering the solutions.
But don’t forget about technology like TradeGecko’s, which allows SMBs to sort through numerous but often simple data such as transactions, delivery records and customer information.
Your mission, should you choose to accept it, is to generate insight into product demand, how demand is structure, how your customers behave and how you can adapt your last mile delivery and logistics to better serve customer needs.
This is possible through TradeGecko’s wide range of integrations with EDI, shipping, 3PL partners and many more.
Give your business the upper-hand and start a free trial today