How On-time Delivery Impacts Customer Satisfaction

By Bianca Barath

When the shopping paradigm shifted from brick-and-mortar to e-commerce, the focus was initially on convenience — shopping from the comfort of our homes. However, with the development of technology within the e-commerce space, shoppers started expecting (and businesses strive to provide) replicated experiences of physical stores, online.?

There was a time when fast deliveries were a key differentiator for e-commerce businesses. However, with the Amazon effect and e-commerce giants setting high standards for delivery speed and reliability, customers now expect similar levels of service from other brands to the extent that it has been normalized.??

An on-time delivery rate of 95% or above is considered exemplary.

You can understand why there's such a high standard for OTDs, as more than 20% of shoppers say they won’t shop from the same store again after a late delivery incident. On the other hand, on-time deliveries play a key factor in customer satisfaction and your brand’s reputation in more ways than one.?

1. Impact on customer loyalty and retention - When a package arrives on time, it reinforces the customer's trust in your brand and leaves a positive impression to the extent that it not only affects immediate customer satisfaction but also has a profound impact on customer loyalty and retention. Research shows that 92% of customers are more likely to make a repeat purchase after a positive delivery experience.?
2. Contribution to positive reviews - 47% of customers share their positive experiences online and 93% of customers read online reviews before making a purchase. Connect the dots and witness for yourself the impact of positive reviews on your brand’s online reputation and in attracting potential shoppers.?

TLDR: Repeated delivery delays erode trust and drive customers towards competitors who meet their ‘bare minimum’ expectations. On the other hand, frequent on-time deliveries have a positive impact on your retention rates and create a positive WoM.?

Thus, the benefit is clear. But we aren’t going to leave you to figure things out by yourself. Here are some actions you can perform to ensure on-time deliveries (even during busy times like the holiday season).?

What You Can Do to Ensure On-time Delivery

1. Use Predictive Analytics and AI for Accurate Delivery Estimates - Leveraging AI and ML-based predictive analytics can help you come up with accurate delivery estimates by factoring in various conditions such as carrier performance, weather conditions, and historical data. This approach ensures that customers receive realistic delivery timelines and reduces the likelihood of ‘delays’.
2. Partner with Multiple Carriers - Shipping carriers strain their capacity during peak season times, making delays not only inevitable but common in occurrence. With different carriers (and service types) having different performance levels, choosing the right carrier with a lower likelihood of delays is a difficult process. This is where you can use multi-carrier shipping strategies to optimize delivery routes and reduce the risk of delays.
3. Hold carriers accountable for their service failures - Shipping carriers are bound by SLAs that mention that you are entitled to a refund of their shipping costs when parcels are delivered late. However, the refund claim process is a hassle when done manually as it involves a lot of paperwork and time from your end. Instead, you can make use of an automated parcel audit and refund solution that helps you save on shipping costs. Frequently auditing your invoices and claiming refunds keeps your carriers in check and ensures that you receive better service quality.??
4. Employ analytics to make post-purchase operations improvements -?Take advantage of reporting tools that tell you more about on-time delivery performance (across shipping carriers, service types, and geographies). You can make use of these hard insights to guide your supply chain decision-making to drive operational efficiency and better meet customer demands.?

Delays Happen, So What?

Post-purchase is an area where events happen outside anyone’s control: weather-related incidents, roadblocks, carriers handling huge volumes of shipments — all factors make delays visibly inevitable. But does that mean you start losing customers for each incident? Absolutely not.?

While on-time deliveries are something that customers expect from your brand, they are considerate enough to accept substitutes that are close enough to reduce their frustrations (from late deliveries).?

In cases where delays are unavoidable, customers expect you to notify them of the delay rather than the other way around (them checking carrier pages and informing you about it). But what if there was an even better way to do this??

Delivery Experience Management platforms like LateShipment.com enable you to monitor shipments in real time and proactively manage delivery exceptions. Here’s how it works: By keeping track of parcels at all times, you can proactively notify customers about the status of their order to manage their expectations and mitigate frustration. Ultimately, customers will start appreciating your efforts to improve their delivery experiences and will give you another chance.?

Mitigate the impact of delays

Yes, on-time delivery is a crucial factor that directly influences customer satisfaction, loyalty, and brand reputation. However, brace yourself for the harsh truth — even with the best possible operations on all fronts, delays are bound to happen.?

While the focus is steadfast on reducing delays, you also need to prioritize proactive communication that exceeds customer expectations of your brand and fosters lasting relationships.?

As the holiday season approaches, ensure that delays are the least of your concerns on customer churn and employ proactive communication strategies to drive growth.?

About the Author:

I work with leading e-commerce merchants to optimize their post-purchase experience, minimizing delivery issues and maximizing customer satisfaction (and profits) through innovative technology solutions. Reach out if you want to discuss how to improve your post-purchase process!