What is a delivery exception?
In simplest terms, a delivery exception is when a package experiences a delay while in transit. A package might experience a delivery exception for a wide range of reasons, ranging from a problem with the recipient’s address to a missed hand-off or an issue with the carrier, whether that’s USPS, FedEx, or PMX.
It’s important to note, however, that a delivery exception doesn’t necessarily mean that a package’s expected delivery will be missed or that its delivery status will be dramatically impacted.
How and why do delivery exceptions occur?
Delivery exceptions are inevitable, whether you’re working with FedEx, USPS, or another shipper. In fact, delivery exceptions affect 11% of all shipments. And of course, during the pandemic, we’ve seen shipping delays become much more common. Even as e-commerce businesses have seen their profits soar over the past year, fewer orders are being delivered on time.
No matter the reason for the delivery exception, the customer experiencing the exception is guaranteed to feel frustrated when their expected delivery is missed or when they’re subject to a late shipment. From there, a customer might reach out to the company or carrier or voice a complaint on social media — neither of which will reflect well on your brand.
Why are delivery exceptions important for e-commerce retailers?
Delivery exceptions can quickly have a serious impact on e-commerce retailers’ bottom lines and affect a number of critical metrics. And, of course, in the worst-case scenario, a customer might decide to return their package, meaning a major loss of money for your brand.
Often, delivery exceptions will lead to a higher rate of WISMO, or “Where Is My Order?” calls. These calls occur when a customer feels out of the loop on a delivery exception. Generally, WISMO calls account for up to 50% of inbound calls to customer care centers, and on average, each WISMO call costs roughly $5 to resolve. That’s partly why offering clear tracking information and updates on delivery status are critical measures.
Delivery exceptions can also increase your business’s churn rate, with our research showing that poor post-purchase experiences are a major source of customer churn. And according to Last Mile Delivery Wars, 98% of shoppers stake their entire brand loyalty on the delivery experience.
A dissatisfied customer who’s just experienced a late shipment is also much less likely to recommend your business to others, which is why delivery exceptions can take a heavy toll on your net promoter score (NPS). Figuring out ways to address delivery exceptions proactively can lead to a 3-point higher NPS score for businesses.
The 6 most common delivery exceptions and what they mean
There are plenty of reasons a package might experience a delivery exception, but here are some of the most common:
- Incorrect address. If the delivery address on the package’s label is incorrect, unclear, incomplete, or undeliverable, the chance of a delivery exception occurring rises dramatically. This is a very common exception when dealing with international shipping.
- Weather delay. Inclement weather or severe weather conditions like winter storms, wildfire, hurricanes, or other acts of God can make delivery routes impassable, leading to delays.
- Lost in transit. Even if everything is going according to plan, a package may be lost in transit. If no one can locate it, this can be the most severe type of delivery exception.
- Damaged package. If the shipping label is damaged and illegible, it can prevent delivery. Similarly, if the package itself is damaged, it might be necessary to cancel the shipment and immediately send out a replacement.
- Holidays. On federal holidays, shipping carriers are less likely to be operating, meaning this delivery exception can occur. Fortunately, consumers are most forgiving about delivery exceptions related to national holidays.
- Missed drop-off. Another frequent occurrence, this exception happens when a delivery driver arrives at your home or apartment and requires a signature to finish the delivery, but no one is home.
Delivery exceptions vary in terms of how long they last, though it’s entirely possible a delivery exception can remain a problem for several days. Obviously, it’s in your best interest to resolve the exception as quickly as possible, to nip a negative consumer reaction in the bud.
What customers expect when a delivery exception occurs
Due to the increasingly high standards set by Amazon, customers have many expectations when it comes to dealing with delivery exceptions. Understanding what your customers want and when they want it is the first step in optimizing their post-purchase experience.
When a delivery exception occurs, roughly 93% of customers want a notification from the company explaining the exception. On top of that, 97% of customers expect that the brand will offer them some form of a self-service option to help correct the issue.
Additionally, many customers want clarity upfront when it comes to delivery dates — 97.8% say that it’s at least somewhat important for retailers and brands to indicate the delivery date when their package will arrive. Our data also shows 47% of customers will avoid ordering from a retailer if they sense a lack of visibility (often provided by tracking pages) during the delivery process. Providing tracking information, an easily accessible tracking number, and updates on delivery status can go a long way towards increasing communication.
And if a delivery exception does occur, expect to make amends if you want to keep your customers. We found that 51% of customers expect brands to offer them appeasements — whether that’s a refund or a discount code for future orders — when a delivery is missed.
How to respond when delivery exceptions occur
As we’ve seen, delivery exceptions are inevitable. It’s how your brand responds when they happen that really counts. In fact, delivery exceptions can actually be excellent opportunities to turn a negative experience into a positive one, reducing post-purchase anxiety for your customers in the future and ensuring they come back.
Responding rapidly and — most importantly — preemptively to delivery exceptions is the name of the game when it comes to managing the post-purchase experience. Delivery Experience Management, the art of proactively ensuring your customers get their orders how and when they expect and taking intelligent action to address exceptions, is at the heart of successful delivery exception responses.
Brands that are practicing and living the customer-first mentality of Delivery Experience Management (DEM) — increasing transparency, creating flexibility for customers, and delivering on promises — are already realizing the benefits. By implementing DEM, Grove Collaborative reduced WISMO calls by 50%, increased their NPS scores by 3 points, and saved $65 per damage claim and $23 per incorrect address.
Leveraging Convey Engage and Recover, Boll & Branch integrated its Shopify order feed with its carrier data. Drawing together disparate data in this way helped its team reduce the resolution time for customers by an impressive 66%. The team also set up new tracking pages and customizable alerts that helped reduce WISMO calls by 30.8% overall, and, most critically, boosted revenue and conversation rates.
Learn more about and demo Convey’s solution for delivery experience management.
What top Retailers are doing to combat delivery exceptions
The leading strategies aimed at combating delivery exceptions today revolve around communication, visibility, and creating opportunities for preemptive action. In practice, those values take the shape in a number of strategies, including:
- Tracking pages. The first step in increasing visibility is offering customers a detailed, clear, and easy to navigate tracking page.
- Shipping alerts. Providing real-time, detailed shipping alerts that reach customers on their preferred channel will allow you to take charge of the narrative when a delivery exception occurs, all while cutting down on pricey WISMO calls.
- AI-powered transportation analytics. AI models like those offered by Convey offer brands the power to run prescriptive analytics, allowing them to see where delivery exceptions might occur before they happen — a crucial interval that can mean the difference between keeping a customer and losing one.
Future trends in managing delivery exceptions
As e-commerce competition continues to grow and it gets easier and faster to get shipments to customers, maintaining customer expectations will only get more important. Gone are the days when brands could ship out a package and forget about it. It’s now mission-critical that you previsualize your shipping experience by integrating AI into your supply chain technology.
In the near future, we can expect to see several trends in delivery continue, with an emphasis on the last mile. Greater flexibility and communication, combined with the personalization of the delivery experience — enabling customers to update their pick-up or delivery instructions, for instance — will take precedence as brands continue adapting to meet the modern shopper’s needs.
And as the delivery experience grows in complexity, it will only be more important to increase your grasp of the supply chain with Delivery Experience Management.