MHI

The Value of Postal Delivery in your eCommerce Shipping Strategy…

12 Oct 2020

There are numerous articles out there professing to know the secret of improving your eCommerce customer experience. And, without fail, one of the bullet-points will always be faster shipping, or free shipping, as if that alone will grant you competitive advantage in the world of online shopping.

In 2020, that’s no longer true…

A highlight of the MetaPack Delivery Conference earlier this year – fast and free no longer gets you ahead of the pack. They simply stop you from falling behind.

In 2020, the real key to gaining competitive advantage in delivery is choice.

But what does this mean?

Well, let’s take one of the countries that you sell your products into, say Germany – when a customer gets onto the shipping screen, they can choose the option that fits them best. They may prioritise price, or speed, or transparency. Ideally, you’d have an option for each.

A premium courier service would be the most expensive, but it would guarantee the best transit time and end-to-end tracking. A standard tracked courier option would be the middle-ground, providing a reasonable delivery time and milestone tracking. The third option is the one I want to discuss, the trusted, old-as-time option:

The Post.

Isn’t the post for sending letters? Shouldn’t I be using a courier service for parcels?

You should be using both. Granted, when you order something in the UK, you usually get sent a tracking link from Hermes, DPD, or even Royal Mail Tracked. These are all tracked courier services where you receive transparency of where your item is during transit.

However, continuing to use the UK as an example, Royal Mail also offer a cheaper alternative – for parcels too. This is the untracked option. Where transparency isn’t quite as important. The item will have an address on it, it will be injected into the postal system, and from there, the next time you hear anything about it, it’ll be at your front door.

Whilst it’s rarely advised for high-value goods. There are many times when an untracked postal service will be a good delivery option for you to offer to your customers. Alongside a standard courier option, if you really want to gain competitive advantage in your delivery strategy, then you should be looking to make use of the post.

Here are five reasons why…

Boost Sales

At the core, adding a cheaper option for delivery at check-out is almost always going to boost sales, as it converts the customers who are dissuaded by an expensive shipping cost.

If you offer a premium courier option and a standard tracked option, you will guarantee your customer transparency and, in most cases, speed. However, the cost of this service may be quite high, which will deter cost-sensitive customers from converting once they reach check-out.

By offering a postal option, you let them know that speed and transparency are not important – but price is. With this additional option, you will attract a wider range of customers who have different shipping priorities.

Save Money

The price of postal delivery is different depending on the country, but it is almost always more cost-effective than a courier option. This is because it requires less rigorous handling in sortation centres and isn’t always required for customs checks.

By offering a postal option, and having your customers select it, your delivery bill will be reduced – providing a cost benefit not only to your customers, but to yourself as well.

Incentivise purchases of lower value products

We’ve all been there. At check-out, trying to buy a cheap, insignificant product, only to be faced by a check-out page with an extortionate delivery cost. This is something Amazon do well through their Prime service, but most retailers do not have such a luxury when their delivery options are limited to high-service delivery options.

By offering a postal option, you increase the volume of low-value purchases from your website as the shipping cost is less of a deterrent to customers.

More cost-effective to offer free shipping

As stated previously, free shipping is no longer enough on its own – but it’s still a great slice of added value. For most retailers, however – especially those with a low volume of orders – it eats into profits and in some cases, almost eradicates it. This can make the offering of free shipping very painful to the bottom line when the delivery service you’re paying for is a premium one.

By offering a postal option, your own shipping costs are lower, and therefore it is more financially viable to offer free shipping to your customers.

Decrease Checkout Abandonment

There are many articles written on reducing checkout abandonment, one of the best can be found here on Shopify. And being clear on shipping costs and delivery times is always high on the list. But choice is a large part of this.

By offering a postal option, a customer will get to check-out and find there are multiple options for delivery, rather than just courier – negating the final barrier to conversion.

What to be aware of…

Naturally, there are drawbacks to offering a postal service, and to your customer of using one. There is no tracking available, and the delivery times are typically longer. However, the key is communicating this on the shipping page. Let them know that they are taking their own risk by using a saver option.

A sure-fire way of increasing check-out abandonment is to leave out transit times, and characteristics of each service at check-out. Be honest with your customer and explain the benefit to them of choosing each delivery option.

Naming the service is another great way of adding value. Whether that is a saver option, or as simple as an untracked option; it helps to differentiate the option and provide an explanation as to why it is likely cheaper than the alternatives.

Here’s a generic example of your three delivery options…

Transit times depend entirely on country and service, and therefore these times are to illustrate typical service characteristics only.

Premium Courier: 1-3 days

Full end-to-end tracking, speedy delivery. You’re there the whole way.

Standard Tracked: 3-5 days

Milestone tracking. Efficient delivery. The safest option.

Postal Saver: 6-9 days

No tracking available. Non-priority delivery times. High chance of delivery. Some risk.

Bottom line:

There are some companies who won’t see any benefits to using a postal delivery service. Their products are too expensive to take the risk of having no tracking, and the customer is willing to pay for premium delivery because of the value of the purchase.

But if you have any medium-to-low value products in your catalogue – clothing, books, beauty, accessories – then you’re missing out by not utilising a postal service for every country that you sell into.

MHI have 80+ direct injection contracts with couriers and national postal authorities in over 200 countries. If you want choice and want to take advantage of a full rate card for all major destinations, including tracked routes and postal untracked routes, then get in touch, and MHI will help you reach a global marketplace.

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