The APAC Grocery Sector – Overcoming Delivery Challenges
Melissa AU Team | Australia, Retail |
From a box of blueberries to bake a cheesecake for dessert to everyday lentils and vegetables, a growing percentage of home cooks are getting their groceries home-delivered from e-commerce sites and apps. The APAC food and grocery sector was valued at $4,863 in 2020 and is expected to see a 6% CAGR by 2025.
Understanding The Impact Of Delayed Deliveries
The convenience of shopping online far outweighs having to pay a little extra for shipping. Most online grocery retailers offer free delivery only after customers meet a minimum order value criteria. Unfortunately, when deliveries are delayed, the experience is inconvenient, expensive and frustrating. The impact is experienced by customers and grocery retailers. Hence, this is a challenge grocery retailers cannot afford to ignore.
- Dissatisfied Customers
While customers are willing to wait a few days for a dress or a pair of shoes they ordered online to be delivered, they expect their groceries to be delivered within 24 hours. Patience is in short supply. After all, what’s the point of getting your blueberries after dessert is made…
Even if the delay was because the customer made a typographic error or submitted an incomplete address, the blame still falls on the seller. Overall, the experience leaves a sour taste for the customer and they may visit competitor sites for their next purchase.
- Loss Of Reputation
When online order deliveries are delayed, customers are likely to leave negative reviews, complain on social media and give the brand poor word-of-mouth publicity. Companies may spend thousands on their digital marketing campaigns but customers trust their peer’s recommendations a lot more.
According to a study, 92% of customers trust user-generated content much more than traditional advertising. Businesses with an overall 1-1.5 star rating typically see 33% less revenue as compared to average enterprises in the same sector.
- Lower Margins
Online grocery retailers have very small margins to work with. While customers will pay a little extra for convenience, if the cost difference is too high, most will go back to shopping in-store. Most grocery retailers also offer free delivery for orders above a certain value. Customers usually take advantage of this to buy more than one thing at a time.
When orders are returned on the basis of addresses being undeliverable, the retailer must bear the cost of reshipping the order. Thus, the company’s margins that were low to begin with become even lower.
This goes down further when you take into consideration the fact that dissatisfied customers have a high chance of turning to competitors and you will need to spend more on acquiring new customers.
Overcoming Delivery Challenges
Issues with inaccurate, incomplete or undeliverable addresses given by customers are usually the reason for delayed deliveries. Here are a few ways to address this issue.
- Ensure Addresses In The Database Are Complete
Washington is the name of a city and a state in the USA. Like this, there are many other cities and districts that share names. This can cause confusion if the addresses provided to retailers are not complete and stop at the city name.
Companies assume that customers know enough to fill in all the fields on an address form but this is often not the case.
One way to ensure all addresses entering the database are complete is to use an autocomplete API on data entry forms. As a customer starts typing out an address, the form generates possible street names, cities, states and so on to complete the address.
Using an address autocomplete API has an additional benefit. It reduces the number of clicks required and thus improves the checkout experience.
- Verify Deliverability
Typographic errors are another common reason for delayed deliveries. This is more commonly seen amongst people shopping from their mobile phones. In many cases, these errors render the address entered as undeliverable.
Let’s say, the customer may enter 100 as the apartment number instead of 101 for a complex with apartment numbers starting from 101.
Using an automated address verification tool can help avoid this issue. Address verification tools instantly compare addresses entered by customers with addresses stored in reliable third-party databases.
Undeliverable addresses are immediately flagged so that they do not enter your system and the customer can enter the correct details.
- Pin-Point Locations
Even when a customer’s address is accurate and complete, deliveries may be delayed because the delivery agent cannot find his/her way to the delivery point. Delays get snowballed when delivery agents spend more and more time looking for delivery points.
It becomes easier for delivery agents to plan optimal routes if they can pin point the delivery locations on maps. This is where geocoding becomes relevant. A geocoder converts street addresses into latitudinal and longitudinal coordinates. These precise plotted coordinates help delivery agents plan routes to reach the delivery location in the shortest time possible.
- Verify Phone Numbers
Deliveries may also fail simply because there is no one at home to receive the order. He/she may be out running an errand or may have forgotten the delivery slot. Hence, it is always best to have delivery agents call the customer before attempting delivery. For this, you need verified phone numbers.
Verifying phone numbers ensures that the number entered is complete, correct, in use and linked to the right customer.
In conclusion
The number of grocery retail players in the e-commerce space is steadily growing. This means there’s competition. When it comes to packaged groceries, there isn’t much that can be done in terms of quality or pricing. Customer service and delivery timelines are thus the most apparent differentiators. Customers will shop from websites and apps where they are offered the quickest deliveries and the best checkout experience.
Retailers don’t have to work very hard to get customer addresses and phone numbers. It’s what they do with it that defines its usefulness. Working with verified addresses and phone numbers empowers grocery retailers to plan the most time-effective routes for deliveries and minimize the risk of late or missed deliveries.