How The Online Retailing Industry Influences Lead Times

Lockdown restrictions continue to limit the way in which physical retail locations can service their customers. In these stores’ absence, online shopping has taken over. Shopping online has made for the safest and most convenient experience for consumers to get their hands on the necessities throughout the pandemic. Customers can browse through entire stock lists and compare products based on different features, competitor pricing and even customer reviews. These sorts of advantages have given online retailing the upper hand over the physical shopping experience. In fact, the growth of this industry in 2019, pre-pandemic, was staggering. Online retail spending was over $3.5 trillion dollars globally from a contributing 2 billion online shoppers.

The online shopping experience would not be what is today without the contributions of Amazon. Since their emergence, the e-commerce space has continued to evolve and provide more than many would’ve ever considered possible. Today, their offerings extend over 12 million different products. Most of which are offered by the third-party merchants that utilize the platform. These products are searched daily by the 200 million monthly users. While this is only a portion of total online shoppers, many smaller online retailers have felt a squeeze as a result of Amazon. Not only do online shoppers expect more products from all online retailers, they also expect some incredibly fast leads times as a result of Amazon. Their prime members receive expedited shipping, with most products arriving in two days. This has contributed to the overwhelmingly 88% of shoppers indicating their experiences with Amazon have made them expect faster shipping times from other retailers in the industry.

Few online retailers will be able to match the logistical prowess of Amazon. The online retailers struggling to keep up with these types of expectations should find ways to improve the customer experience in the meantime. For example, knowing their shipping times may be longer than average, providing customers a branded tracking page can make all the difference. Customers can keep up with their shipment each step of the delivery process, sometimes up to the minute. At the very least, this offering will settle any worries customers may have that their package could be lost in transit.

While these branded tracking pages are a great start, online retailers can offer more for their customers. Improving the benefits that users receive is another great way to enhance the customer experience. For example, allowing first time visitors to create an account and save all critical shipping, billing and user information immediately. This way customers can be encouraged to return to an online retailer’s website and place additional orders without the stress of having to input all of their information again. Quicker orders or re-orders can often be the difference between a customer placing additional orders or never returning to a website.

It’s also worth considering ways in which these smaller online retailers can reduce the shipping costs incurred by customers. Recent research done on online shoppers has indicated that cost and speed of shipment are the most important factors in deciding where an online shopper purchases goods. Not only do these shoppers want their products delivered in a timely manner, they also want to pay the lowest possible costs that they can. In fact, customers would rather wait longer for their orders assuming they don’t have to pay for the shipment. Smaller online retailers should then prioritize ways to decrease the shipment costs their customers incur. Finding the cheapest solution for shipping orders is often accomplished through an automated storage and retrieval system for an organization’s warehousing and transportation solutions. For additional information on how to integrate these systems into your organization, check out the featured resource accompanying this post.

Author bio: John Hinchey is VP of Sales for Westfalia Technologies, Inc., a leading provider of logistics solutions for plants, warehouses and distribution centers. He has more than 20 years of experience in manufacturing and warehouse automation.


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