The Changing Face of Delivery Part 1 | The challenge of customer happiness in the age of immediacy
In the age of immediacy, both B2C and B2B customers have increasingly high expectations when it comes to delivery.
Next Day Delivery is now the norm, and Same Day Delivery isn’t far behind.
Businesses are now faced with the challenge of providing their customers with super-fast, low-cost delivery, frequent notifications and an immediate response to queries. All whilst running a streamlined, cost-effective service.
In this post we will take a deeper look at these challenges to help you understand what you are up against.
The power of the B2C consumer
Let’s begin with one of the most influential forces within retail; the B2C consumer. Notably, the digital-native Gen Z alongside the tech-adopting millennials have been causing some significant shifts within B2C retail, and with Gen Z alone expected to account for about 40% of all consumers by 2020 retailers need to sit up and pay attention.
Changes to customer expectations
Technology has become a significant liberator for consumers; opening up a world of choice and thus forcing brands to become more competitive than ever before. Brands are now having to listen to exactly what consumers want from their retail experience, and it turns out expectations are high. Particularly in relation to service and delivery.
We are now living in the age of immediacy, meaning that consumers not only expect to find products easily, but they also want to get their hands on their purchases straight away. Fast delivery is such a significant factor in the buying process that more than two thirds of consumers today would switch to another retailer if better delivery was on offer, and 58% of Gen Z shoppers say they’d pay more than $5 for one-hour deliveries. In fact, by 2021 experts predict that ‘instantaneous delivery’ will be the expected norm.
To add to these expectations, consumers are becoming increasingly comfortable with telling businesses what they think, most often via reviews on retailer websites or via social media. In fact, 40% of Gen Z shoppers say they give feedback often or very often after purchasing.
Add to this that 78% of consumers say they’ve experienced packages arriving late (up from 70% in 2017), and 56% of consumers received damaged packages (up from 42% in 2017). With this in mind, the power of the review could have detrimental effects for many brands who do not embrace customer satisfaction.
Delivery isn’t the only element of retail that is facing a significant change. How consumers research and buy is evolving at a rapid pace; widening the availability of reviews and information available.
B2C consumers don’t simply want to visit a retail store, nor spend hours browsing online.
Instead, they choose to combine both options, as well as add social channels to the mix; creating a true omnichannel shopping experience. In fact, 38% of retail purchases are now made via multiple channels.
Social platforms, in particular, have evolved into a channel where consumers expect customer service, delivery updates and immediate interaction with a brand.
But.. what about B2B?
Sometimes the industry needs a friendly reminder that the B2B sector are consumers too. In fact, it would be foolish to think the buying habits these consumers pick up in their personal, B2C purchasing does not influence their B2B purchasing behaviour.
B2C consumer behaviour has resulted in similarly high levels of expectations in the B2B sector; Chief executive of Redwood Logistics, Mark Yeager, said although his company was not “heavily reliant” on retail, the impact seen in the B2C sector was “definitely” having an impact on his business.
B2B are millennials too
In the past two years, the overall change in the B2B researcher demographic is dramatic. If we look back in 2012 there was a fair even mix of age groups, however, in 2014, the change started to begin the increase of millennial researchers went up to 70%.
Additionally, the enterprise technology buyer is changing. One-third of Millennials reported having budget and/or sign-off on enterprise technology purchases of $10,000-plus. In comparison, 23% of Baby Boomers and 27% of Gen X reported the same authority.
Notably, Millennial favourites such as one click ordering and next day delivery are having a particularly large impact on many industrial and construction brands, who have traditionally relied on the model of storing goods near the consumer so that they can come and buy it.
Old habits die hard
Yes, delivery is changing. However it’s important to acknowledge the legacy processes which are still prevalent today.
Specifically, those which have been traditionally followed by businesses fast become set in stone; being followed by multiple people and departments within a business.
For example, a restaurant that traditionally receives a food order at 7am on a Monday will have processes set around this time, such as opening hours, vehicle access, staff starting times.
This results in very high expectations for delivery. Even if an ETA is given, when a company is used to a order being delivered at a specific time each week, this is what they will continue to expect.
As businesses evolve to meet the needs of an evolving audience, it is important that they don’t let down the businesses who require regular, set deliveries. A delay in this regular delivery can have a significant impact on the day-to-day running of the wider business.
B2C expectations are increasing
Digital-native Gen Z alongside the tech-adopting millennials have been causing some significant shifts within B2C retail, notably:
- High expectations for fast and accurate delivery
- Frequent reviews of brands, including the delivery experience
- Diversity in channels used to research products and delivery before they buy
B2B buying behaviour is changing
The personal buying habits of consumers is influencing their B2B buying behaviour. Particularly for millenials, who are naturally making up an increasing amount of the B2B population.
Legacy processes still exist
Many businesses have set processes built around regular, specific delivery times. It is important that these businesses are remembered as suppliers address the challenges of an evolving audience.
Watch this space for the next installment in this blog series, where we share our secrets to keeping your customers happy.
Or, if in the meantime you would like support in keeping your customers happy, get in touch with one of our experts.