What Same-Day Delivery Could Mean for Your Sales
Posted by Resource Nation on October 28, 2013 in Sales 2.0 [ 0 Comments ]
There are very few companies that don’t have to deal with supply chain issues. It’s simply part of the world of global commerce. Products are manufactured in one part (or sometimes multiple areas) of the world, shipped to another and are distributed to companies or consumers through a number of channels. In effect, the supply chain is one of the most important components of customer satisfaction that the majority of consumers aren’t aware of. Depending on which country a company operates in, the speed of delivery for products and services can vastly influence the level of sales on a daily or even an hourly basis. For example, several Asian countries, such as South Korea, Taiwan and China have e-commerce websites that offer same-day delivery for nearly all products.
Global E-commerce on the Rise
Of course, geography and the size of a country are major factors that affect the way companies can feasibly reach consumers, but the number of online shoppers is growing. According to eMarketer, business to community e-commerce sales around the world grew by more than 21 percent in 2012 when compared to 2011, and have achieved an estimated $1 trillion in total revenue. The increase in sales in North America improved to nearly $365 billion last year, which reflects almost a 14 percent increase. The marketing website indicated consumers have moved to online shopping platforms in response to greater deals, convenience and a broader range of options. However, the Asia-Pacific market has rapidly expanded.
With a large portion of support likely coming from the surging Chinese economy, e-commerce sales saw a 33 percent increase in 2012 (Tweet This Stat!). Beyond the size of the country, there are a multitude of factors that can influence how well-received e-commerce is in different countries and what effect same-day delivery might have on consumers. Small businesses likely don’t have the space or the resources to offer shipments that will arrive in less than a day, let alone 5 or 6 hours. This is why many enterprises have partnered with distributors like Amazon to help deliver their products with greater efficiency.
Improving Purchase Conversions Rates
Dating back to 2009, the online retail giant began offering same-day delivery in limited markets. Storefront Backtalk, a division of FierceRetail, highlighted the fact that giving consumers the option of same-day delivery increased the rate of conversion on sales by between 20 – 25 percent (Tweet This!). That translates to fewer abandoned shopping carts, a phenomenon which has plagued online retailers for some time now. It’s important to note the option was made available only to Amazon Prime members, and didn’t cost them any more than next-day shipping.
Yet the most interesting takeaway from the study was the fact that the majority of online shoppers didn’t opt for same-day delivery. Internet Retailer, an e-commerce news site, indicated other businesses have had a similar issue with offering lightning-fast delivery. During the 2012 holiday shopping season, the Internet retailer Moosejaw Mountaineering offered same-day shipping for consumers in the Chicago and Denver metropolitan regions. The main caveat was customers had to spend at least $99 and pay about $15 for the service. Again, few people expressed interest and no one took the bait.
What’s Holding People Back?
You would assume consumers would jump at the thought of such convenience. One of the main issues is customers come to online shopping with a specific mindset. While you can find great deals and a huge number of products online, you’re going to have to be a bit more patient for your products or services to arrive because of the buying platform. In effect, people aren’t used to same-day delivery.
It hasn’t yet become part of the e-commerce customer experience. For this reason, enterprises looking to take advantage of this service have to ensure their customers know about it. There must be information campaigns that explicitly show consumers the benefit of the service. In reality, shipping options are a way for retailers to personalize the purchasing experience. It shows consumers they’re interested in serving them to whatever length they desire. Shoppers just need to know the option is on the table.