Delivery still an issue for online retailers

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The growth on online sales seems to be unstoppable. In the UK, for example, high street sales have fallen over the past couple of months but online sales are growing strongly.

However, the latest IMRG Capgemini e-Retail Sales Index also highlights a widening gap between multi-channel and online-only retailers. Those with both a high-street and online presence witnessed a 19 per cent growth on average last month compared with March last year, while online experienced just six per cent.

Combine that information with results from the latest “Global E-Commerce Delivery Report 2011” from Hamburg-based market research firm and some of the challenges facing retail supply chains are thrown into sharp relief.

The report shows that delivery and logistics have become an important factor for e-commerce in the competition for customers.

It points out that in the USA some traditional retailers seek to compete with the efficiency of online retailers such as by forging new possibilities to process online orders also at their retail shops.

It also found that the most popular advertising method to boost e-commerce during holiday periods is to offer free shipping. In Japan, online retailer has introduced free shipping for food items as a regular service and was wooing customers at the end of 2010 with a discount of ten per cent.

British e-commerce portal has in the meantime introduced free shipping for orders above £25 for customers from 17 European countries.

Nevertheless, delivery remains a problematic area. Tellingly, found that in the Netherlands, one third of all online customers responded that they would purchase more goods online if delivery options were to improve.

It is becoming more and more apparent that one size does not fit all when is comes to delivery. Although the range of options has increased, there is no doubt that retailers and carriers need to do more work on the delivery requirements of their online customers to optimise their service offerings.

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