8 Tips for Balancing Customer Delight and Shipping Costs

by | Dec 11, 2019

4 min read

The holidays are looming, so you’re busy, busy, busy in the shipping department — trying like crazy to keep customers happy and your head above water.

It’s no secret that it’s getting harder than ever to give customers an experience that will delight them without busting your budget in the process. And part of that experience is fast and/or free shipping.

Listen, I love getting my set of steak knives delivered for free in just two days as much as the next person. But as a shipping industry veteran, I know what shippers go through to actually make those shipments happen — and all the ways it can go haywire.

 

Consumer shipping expectations are only getting higher

The shipping portion of your customer experience is one of the most visible — and one of the most polarizing. Seventy-seven percent of online shoppers in a recent global survey have abandoned a purchase because they didn’t like the shipping options. Another 58% said they quit shopping with a retailer altogether after a bad shipping experience.

The stakes are high and the pressure is on your shipping team to get it right. And because budgets are always tight, you need to look high and low for ways to keep costs under control. I’ve assembled a few tips to help.

 

8 ways to keep shipping costs down and customer spirits up

 

On the back end

  • Regularly review order and fulfillment trends to ensure product placement plans are cost-effective and efficient. Other than a potential cost benefit for point of entry into the U.S., it typically makes little sense to individually fulfill ATV snowblades from Jacksonville, Florida, when the shipper has distribution centers in West Virginia, Illinois, and Colorado, right? Watch out for this type of logistical misstep that can throw your costs way off track before you’ve even taken the order.
  • Review your product mix and frequently paired products. This will help you identify packaging options that match up with your carriers’ efforts to optimize their networks. Selecting the right packaging for your items is key, but it’s something many shippers don’t think through.


Before you ship

  • Use your past shipping data and your carrier contract to create routing guidelines that your team can consistently, diligently follow. Whether it’s for inbound, outbound or third-party shipments, putting a plan in place will save expensive mistakes later. Once you have your guidelines in place, enforce them!
  • Validate recipient addresses. Address corrections are costly, but so very easy to fix if you implement a solution or method for maintaining up-to-date information.


In your order management

  • Look for opportunities to consolidate shipments. Whether consolidating orders to a single recipient address or individual shipments to an access point where the shipments will be split for final-mile delivery to the recipient address, medium-sized and large shippers can find these opportunities within their order management system (OMS). Smaller shippers usually rely on their experienced, attentive fulfillment team members for these insights.
  • Let your customer choose to consolidate. Some of the largest shippers, like Amazon, actually let the consumer bundle purchases to be delivered together on a specific day. In return, they give the shopper benefits like reduced costs, credits towards future purchases, or even expedited shipping once the orders are pooled and eventually shipped together.


In your messaging

  • Get the shopper on your side. Share the intent of policies and the value of various shipping options clearly and concisely. Make them part of the process and provide choices — let your customer visualize the cost of getting multiple shipments when one would suffice.
  • Over-communicate. Give updates throughout the shipping process to keep your customer informed and feeling confident they’ll get their package when they expect it. And of course, if they won’t get their order on time, offer them an explanation and an apology.

These are just a few of the ways you can keep a lid on costs while ensuring excellent customer experience at the same time. Of course, actively managing your shipping charges is imperative as well, but that can get cumbersome and time-consuming if you don’t have the right tools.

As your business grows, balancing customer experience with costs will be more and more challenging. But by implementing these tips now, you’ll be better prepared down the line.

Topics: Customer Experience, Distribution Centers, Shipping Data
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