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Logistics can help e-tailers boost their business, says UPS

Zafirah Salim | June 17, 2015
With greater focus on the customer experience through improving delivery processes, e-tailers can ‘break through’ the low satisfaction rates of Asian online shoppers, said Rob Houck, Vice President of Marketing at UPS Asia.

In addition to becoming more adept at developing innovative solutions in response to retail trends, logistics providers have also had to look at widening their last mile delivery networks. UPS' culture of continual innovation and insights developed from working closely with our customers have allowed us to deliver solutions that empower relationships between our customers and their partners, enabling them to grow their business, improve customer service experience and better manage their supply chains.

For example, a customer may browse through a number of online shops to scout for a product. He/she will then choose one to purchase from, and then want to be able to pick their product up from a traditional brick-and-mortar store. This kind of flexibility requires fluidity between a business distribution centres and their retail locations, which requires logistical planning to ensure that consumers are able to receive their items when they want them. The 'last mile' has become an area where companies are seeking a competitive edge, and smart logistics is key to ensuring that this crucial stage of the delivery process is carried out smoothly.

Delving deeper in the idea of online shopping itself, how does logistics play an integral role along the path to purchase, especially in Asia?

With the growth of e-commerce, online retail competition has increased exponentially and logistics is an effective strategy to compete beyond price. Retailers who are able to satisfy the consumers' desire for a full range of delivery options at checkout, as well as convenient and flexible returns, can gain a significant competitive advantage.

Only 37 percent of consumers in Asia are satisfied with the number of shipping options offered, significantly lower than their counterparts in US (65 percent) and Europe (55 percent). It is important that a range of convenient and flexible delivery options are offered so that consumers can decide on a delivery option that best suits their needs. The ability to provide an estimated delivery date also encourages consumers to complete their purchases, as the study also revealed that 60 percent of shoppers would abandon a cart if an estimated time of delivery was too long or when no estimate was given.

For instance, a retailer looking to drive preference and encourage greater cart sales can incentivise consumers by offering free shipping. The 2015 Pulse of the Online Shopper study revealed that almost half of Asian respondents have added items to their shopping carts to qualify for shipping; indicating that retailers should view this as an opportunity to increase revenue by using free shipping to incentivise consumers to commit to a greater spend.

We believe that with greater focus on the customer experience through improving delivery processes, e-tailers can 'break through' the low satisfaction rates of Asian online shoppers.


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