Last mile logistics and supply chain have changed at an unbelievable rate in the last twenty years. As eCommerce soars and becomes a more important channel for retailers, it is becoming ever-critical for retailers to manage consumer expectations on how, when, and in what condition their customers’ deliveries will arrive at their front doors.
However, information needed to make delivery experience management a reality has traditionally lived across a hodgepodge of Excel spreadsheets, emails, care tickets, carrier reports and web pages. In fact, in a survey done last year, 68% of supply chain and logistics leaders said that Spreadsheets were their primary tool to pull delivery data together.
It’s up to logistics and supply chain managers to either change — or to spend hours collating bar code scans, shipping pages, tracking numbers, truck telematics and more. If it wasn’t hard enough collecting all of that data in the first place, logistics teams have to make sure it’s updated in real-time as well.
Meanwhile, customer service teams are also trying to understand and collect information for their customers. When a customer calls in about a delivery exception, a customer service agent has to go find tracking information, carrier information, and they have to resolve the issue. Retailers have reported that each exception can take hours for each agent to resolve, especially if they have to dial through phone trees to reach the carrier and find answers for their customers.
The Challenge of Connecting Data in the Last Mile
Data types and formats vary widely depending on factors such as the shipper, the carrier, the leg in the delivery journey and the freight mode. They may include emails, bar code scans, shipping pages, tracking pages, truck telematics and mobile device updates. But without a way to “normalize” all these different inputs and scenarios, and see updates in one place, it’s hard to understand early warning signals and implications before they become potential customer problems.
In a recent survey with EFT, we discovered that ⅔ of supply chain and logistics leaders said that connecting disparate data quickly is among their top three challenges, and 18% reported that they had zero visibility into distressed shipments. Even if there are issues with deliveries in-transit, only half of supply chain leaders surveyed did not have a process in place to support escalations with carriers.
“Retailers are left with either the ability to address and process customer issues in a siloed manner, or a heavy lift to integrate the relevant data.”
According to REI’s Matt Bergerson, there’s no good way to process all of the information. He says that teams need support from internal and external parties to get visibility into data, and process it into insights to make improvements. He says, “Retailers are left with either the ability to address and process customer issues in a siloed manner, or a heavy lift to integrate the relevant data.”
Disconnected Delivery Systems Break at Scale
Even successful companies have struggled with finding processes to scale their businesses, using hacks along the way to “make a problem better.” While this band-aid will temporarily slow the bleeding, it does not solve the root of the problem.
Delivery exceptions are expensive, and “fixing” them quickly requires teams to quickly have a way to pull together disparate data in real time and then take action. As Grove Collaborative aimed to scale shipping volume, it found that delivery exceptions rose as well and created a burden on its Customer Happiness Team. Day-to-day, team members would get various exception messages from carriers into their email inboxes, parse through the inconsistencies. The team as a whole had little control over internal workflows, speed, and accuracy of responses.
The team created a Zendesk hack to tie together shipment issues with customer service complaints, but they still had issues understanding when, where, and how delivery exceptions would come up. They felt like they were putting the responsibility on their customer to call in and correct the issue when it came up.
While there is value in spreadsheets, hacks, and more on an individual basis, it doesn’t allow teams to make the customer experience better, work together with other teams and improve last mile delivery. By connecting disparate data together, companies like Grove are able to reduce their response time by up to 77%. In just a month, Grove’s small team was able to resolve over 110,000 exceptions, and they spent their new-found time supporting customer initiatives that would increase their AOV by 50%.
Automation and Collaboration are Necessary to Compete in the Last Mile
There is simply too much at stake in the last mile for retailers to spend countless hours doing data entry and piecing together data entry in spreadsheets, which are error-prone in nature — 88% of Excel spreadsheets contain multiple errors.
Customers today are not bound to shopping in their local vicinity. Online competition continues to grow, Amazon has taken over 49% of market share, and customers increasingly rely on the last mile as an indicator of whether or not they will remain loyal.
If a shopper has called in asking, “Where is my order?” (WISMO), it’s already too late. At Home Delivery World, Greg Dahlstrom, Bodybuilding.com’s VP of Logistics, emphasized the cost of exceptions to customer experience. He said, “If you aren’t able to resolve these issues, it’s going to be damaging to your business, and damaging to your reputation. As a company, we have to be able to stay on top of these exceptions and resolve them, or we’re going to lose customers.”
“If you aren’t able to resolve these issues, it’s going to be damaging to your business, and damaging to your reputation. As a company, we have to be able to stay on top of these exceptions and resolve them, or we’re going to lose customers.” -Greg Dahlstrom, VP of Logistics at Bodybuilding.com
It’s important to see the data pulled together, but it’s even more important to be able to act on it, in a quick and organized way. According to our recent customer survey, customers want to know that brands have a plan of action if their delivery goes off the rails. When 93% of customers want to be notified of delivery exceptions, retailers should not only monitor shipments for damages and issues that happen in-transit, but use connected data to trigger automated actions, such as alerts, to improve customer communication. Customers need to know that their retailers will have their back when delivery goes awry, or they will shop elsewhere.
Acting Quickly on Delivery Exceptions Saves Time, Money, and Customer Happiness
In a world where consumers have endless options to shop, any delivery that misses expectations risks losing a customer — 84% of shoppers will not return after a poor delivery experience. Brands who understand when, how, and why delivery exceptions happen can get ahead of them and optimize their operations. Companies such as Grove Collaborative, UncommonGoods, and Bodybuilding have started using Exception Recovery — because they can see and understand their delivery data, they can now optimize their deliveries to ensure that customers can get the best experience possible.
By proactively handling shipments, Grove saved $65 per shipment from damage claims and $23 per shipment from resolving incorrect addresses, in addition to increasing its NPS scores by 9.4%. Through Exception Recovery, Bodybuilding.com increased its NPS scores by 6.3% and has improved on-time delivery by 4.5%. UncommonGoods uses Exception Recovery during high-volume holidays to ensure that they keep customer promises — as a result, they have gained a cult following.
Download our report, The Perfect Delivery: Overcoming Roadblocks in Customer Experience, to get more insights and tips on how to perfect your last mile experience, and learn more about Exception Recovery here.