Research From the Leader in On-Demand Fulfillment Reveals Quick Shipment Guarantees Are More Powerful Than Discounts, Driving eCommerce Cart Conversions
ATLANTA--(BUSINESS WIRE)--Ware2Go, the UPS (NYSE:UPS) founded on-demand fulfillment network and integrated tech platform enabling merchants of all sizes to offer one-to-two-day shipping, today announced results of a new merchant survey focused on customers’ shipping preferences, as well as their fulfillment strategies to meet evolving customer demands.
The Need to Ship Faster
According to merchants, customer behavior shows that faster shipping is more effective in driving conversions than discounts, with 65% of merchants reporting an increase in eCommerce cart conversions of up to 25% when they offer a one-to-two-day delivery promise. In fact, merchants said that the most impactful tactics to drive cart conversions involved shipping promise:
- 56%, free shipping
- 52%, 1-2-day shipping
- 29%, free gift with purchase
- 26%, in-cart discount
A significant majority of merchants (75%) believe that offering two-day shipping makes them more competitive, with 60% of those polled currently offering one-or-two-day shipping guarantees.
What’s more, fast shipping inspires customer loyalty, particularly during a time when 87% of consumers are shopping from home due to the global coronavirus pandemic.
- 71% of merchants find that customers are willing to pay extra for one-to-two-day shipping to receive their products sooner
- 59% say that offering two-day shipping guarantees brought more repeat customers
- 39% say it gets them better online reviews
- 22% view fast shipping as a way to beat out their competitors
These insights demonstrate that as customers do more shopping from home, the delivery experience becomes increasingly important and that businesses hoping to compete in the eCommerce space must build a fulfillment strategy to meet growing customer expectations.
Evolving Expectations Mean Evolving Operations
Fully one-third of merchants (33%) characterized themselves as B2E, or “Business to Everyone,” vendors, signaling the continued need for merchants to deliver effective service across multiple channels, including LTL and FTL shipments to wholesalers and retailers, as well as small parcel direct-to-consumer.
“Meeting consumer expectations for fast shipping requires powerful behind-the-scenes operations, from supply chain to last-mile delivery,” commented Ware2Go CEO Steve Denton. “Merchants who optimize those operations through strategic partnerships are poised for success in today’s eCommerce-driven, B2E economy. This research validates the need for the type of flexible and scalable infrastructure Ware2Go’s model affords its merchant partners.”
Managing Warehousing and Fulfillment Workflow
Operationally, merchants do face several key challenges, most notably:
- Insufficient inventory management (33%)
- Incorrectly filled orders (31%)
- Slow delivery speeds (30%)
- Lack of labor availability (30%)
Some 50% of merchants currently insource their warehousing and fulfillment and plan to continue doing so, while 32% say they both insource and outsource. Merchants do see positives associated with outsourced warehousing and fulfillment providers, characterizing outsourcing’s key benefit as reduced operational pain points, at 44%. Of those merchants who do insource, 21% say they recognize they should move their operations to an outsourced provider.
When it comes to barriers to adopting an outsourced warehousing and fulfillment provider, 34% of merchants cite difficulty finding vendors with the flexibility to meet their unique requirements. In this shifting economic landscape, many merchants have seen their customer base shift, requiring them to pivot to a new B2E model of business. These merchants would benefit from partnering with an integrated fulfillment provider with technological capabilities to connect all of their sales channels to their fulfillment operations in order to automate complex processes.
About the Survey
The survey was conducted in August 2020 by Propeller Insights on behalf of Ware2Go. It polled some 250 merchants operating both online and brick-and-mortar businesses, with revenues ranging from $2 million to $200 million.
Ware2Go, a UPS Company, operates a turnkey nationwide fulfillment network designed to help merchants easily position products closer to end customers for a fast, inexpensive and reliable order-to-delivery experience. Ware2Go offers an integrated solution for storage, pick, pack, and shipping services to businesses of all sizes through an intuitive cloud-based technology platform that makes it easy to extend your distribution footprint and scale up and down as your operational needs change. Ware2Go simplifies nationwide fulfillment to help you meet your customers’ needs and expectations.
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