With the final quarter of the year nearly upon us, we’re revealing which shipping challenges are causing the most stress for online retailers in 2023. We presented 398 US brands with four sets of challenges—domestic delivery, tracking, returns, and cross-border delivery—and asked them to rank the most and least challenging from each.
The values in the following charts represent deltas, or differences, between responses. Simply put, high positive numbers reflect responses most frequently chosen as “most challenging,” while low negative numbers indicate responses most often picked as “least challenging.”
Because we know ecommerce brands’ needs and challenges depending on business size, we segmented responses by annual direct-to-consumer order volume, designating 250k+ annual orders as “high-volume,” and 25k-249k as “low volume.”
Domestic delivery: Cost comparison as clear as mud
Domestic delivery takeaways:
- The top delivery challenge for online retailers: difficulty comparing carrier cost structures. While it’s no shock that untangling complicated rate structures (and mythical volume discounts) is the primary thorn in shippers’ sides, the emphasis that high-volume retailers place on this challenge is somewhat surprising, especially given that these brands have more resources available to dedicate to cost analysis.
- We always advise that, when collecting bids, retailers put the onus on carriers to build a personalized business case comparing their rates to competitors’. For example, at Pitney Bowes, we use our proprietary BOXlab software to model specific savings comparisons and design best-fit services based on a shipper's parcel profile and logistics strategy.
Tracking: Difficulty standing out in the crowd
- Delivery tracking is a highly mature and largely commoditized space, teeming with several dozen tracking software providers and carrier-offered solutions. Given the maturity of this space, it’s no wonder that “difficulty differentiating customer tracking experiences” tops the list of tracking gripes for retailers of all sizes.
- Meanwhile, affordable multicarrier tracking with advanced features (i.e., SMS/text and email notifications, a map to trace order shipment progress, and order-specific details) is a close second for lower-volume retailers.
Returns: Mitigating fraud and abuse
- Managing fraud and abuse far outranks every other returns challenge for retailers across the board. We often hear from online brands that arelooking to strike the right balance between strict policies that are harder to abuse and inconvenient policies that drive away honest customers. Our top two recommendations are:
- Use AI to tailor returns policies according to specific customer behavior. As AI continues to transform the ecommerce landscape, seek out returns vendors who are harnessing intelligent decisioning to distinguish honest customers from policy abusers and downright fraudsters, then apply the appropriate logic in each scenario. AI can help reward honest customers with full refunds, early credit, and fast exchanges; discourage policy abusers with return shipping fees and deferred refunds; and turn away fraudulent customers by disallowing returns.
- Employ package-less and label-less returns drop-off. Because the consumer can’t simply hand off a sealed box at a drop-off location, incidents of incorrect and missing items being shipped back drop dramatically. Package-less also helps reduce exceptions, which ranked as retailers’ second-most pressing returns challenge. By shifting the task of packing the return from the consumer to a professional, package-less returns vastly reduce the number of exceptions caused by poor packaging quality (i.e., damaged/unreadable shipping labels, poorly sealed packages, loose tape/cardboard that can get caught in conveyor systems, etc.). As a final bonus, the first-mile consolidation of returns volumes also drives lower transportation costs.
Cross-border delivery: Finding a carrier who can do it all
- When it comes to international shipping, finding one provider who can handle both compliance and logistics is the top challenge across the board, while difficulty localizing the buyer experience is a close second for high-volume shippers.
BOXpollTM by Pitney Bowes, a weekly survey on current events, culture, and ecommerce logistics. Conducted by Pitney Bowes // 398 US retailers surveyed May-July 2023. © Copyright Pitney Bowes Inc.