The impact of lost or missed deliveries on retailer reputation

The demand for fast and accurate online delivery has never been bigger, but the knock-on effect lost and missed deliveries has on reputation for retailers is a growing problem. So how do we solve it? HubBox explain all.

Shopping online is fast, it’s seamless, and it’s easy. Or at least, that’s what the likes of Amazon have led consumers to expect. In a world where over (51%) of retailers offer same-day delivery and 65% plan to offer it within two years: the expectation has never been higher. And yet – TrustPilot reviews reveal that retailers are taking a battering, as missed and late deliveries are creating an online storm of discontent. Items arriving damaged, items delivered to the wrong address, items arriving late (despite the customers paying top dollar for so-called ‘next day’ delivery)… all this is causing customers to quickly fall out of love with brands. And all this is impacting retailers where it hurts with a fifth of Brits (17%) stating they are less likely to order online if they have a negative experience of online delivery communications. 

The term missed delivery is misleading. It suggests that the recipient was somehow lax or remiss in their behaviour – they weren’t home when the driver called, for example. The term actually covers a whole raft of different scenarios, such as:

• The carrier turned up at the right time, but dropped the package at the wrong address
• The carrier turned up at the right house, but a day too late
• The carrier wasn’t able to get a signature for an item that had to be signed for so was forced to make a redelivery attempt
• The carrier turned up at the right place, at the right time, but no-one was home
• There was no suitable or designated ‘safe place’ for items to be left 

In all these scenarios, many parties could be at ‘fault’ – and unpicking the reasons behind them all is complex and difficult to remedy. Yet it’s nearly always the retailer that loses out, regardless of where customers decide to place the blame, or where the issue originated from in the first place.

Here are just some of the reasons behind missed deliveries:

Carriers not being accountable

Some goods turn up damaged – and some don’t arrive at all. Yet proving who’s at fault costs time and money. Often, it’s easier to replace as a goodwill gesture than go through the mill of proving that a road closure prevented the carrier making good on their delivery promise.

Signatures being required

Most of us can’t or won’t commit to being home 2-3 days’ ahead – so what chance does the carrier actually have of getting us to sign for something? From clear roads and good weather conditions to driver availability: if an item needs a signature, then you’re looking at a lot of factors to converge to make it happen. Only for the customer to pop out at the last minute and the whole thing falls apart.

No safe place to leave the package

With the best will in the world, customers will sometimes miss that text that asked them to update their delivery preferences. The result? Yes, sometimes, packages will get left out in the rain. Or left unattended and stolen. Or taken away until the customer is driven by pure frustration to update their preference for a ‘safe place.’

Incorrect data 

Bad data, whether entered by the customer or mangled through a series of siloed software systems, is a big issue for carriers. How often have you seen your package merrily make its way down the next street? This all results in packages being left with the wrong recipient or subject to a redelivery schedule which only serves to frustrate both customer and carrier.

Who gets the blame?

According to research, consumers are more likely to blame the carrier (43%) than the retailer (34%) if their package arrived late. Yet a quick Google reiterates the same message to consumers over and over: the buck stops with the retailer. And it’s the retailer that ultimately loses out in the long run, with over half (57%) saying that they’d not use the retailer again if they used a bad experience. 

The impact on retailer reputation

What’s the impact on a company’s brand perception and bottom line? Let’s dig in.

Unpicking the reasons behind a missed delivery is complex, with many logistical elements at play. Regardless, it’s nearly always the retailer that loses out. For example:

Damaging Public Reviews

Retailers that fail to provide an adequate response to customer complaints can expect negative reviews. These can pop up in many places online, whether gathered intentionally as part of the customer experience process, or unsolicited via social media channels. Research shows that customers aren’t shy about doing so either: with 28% of customers saying that it’s more effective to voice a complaint about an online order publicly rather than contacting the retailer directly. And potential customers take note: a whopping  86% of customers hesitate to purchase from companies with negative reviews.

A decrease in returning customers

If you’re in the business of getting packages to people on time, then a failed delivery is a major black mark: Figures vary depending on the source, but the bottom line is: when faced with a negative customer experience, customers lose faith, sometimes never to return.

According to research by Zendesk, 50% of consumers will switch to a competitor after one bad experience, and 80% will switch to a competitor after more than one bad experience.  Layer in the fact that people will also avoid a company based on someone else’s experience – let alone their own (see point above) – and it’s clear that missed deliveries are a ticking time bomb.

Shipping costs & reimbursements

Package delivery failures create a cost spiral for retailers. According to a report by PCA Predict, British e-commerce retailers lost out on £183,000 a year through lost or failed deliveries, compared with £155,816.06 ($216,171) in the US and £107,538.30 (€121,804) in Germany. Whether through refunding delivery charges, to offering goodwill gestures such as discounts: the costs of failed deliveries can quickly add up, eroding paper-thin profit margins.

Future investment risks

A good reputation serves a company well, but a lousy reputation inflicts damage and potential ruin, says Entrepreneur in: Why Investing in Reputation Management is Crucial for Your Business Strategy. Strong social proof of a company’s mission to make good on its delivery promises is attractive to investors, whereas a string of negative reviews is not. 

Interestingly, it’s not just smaller companies that cause customers to shake their heads in dismay: as we’ll see, retail giants, such as ASOS, Boohoo and Nike, all have a substantial portion of delivery-related complaints and experiences. So the takeaway here is: smaller companies can take on their larger counterparts by building a reputation for reliability. [Ideal stat: xx% customers feel more confident placing an order with a company that delivers consistently]

Customer acquisition costs

Acquiring customers is hard enough. Throw in the cost of failed deliveries and all this work can be dispelled in the time it takes to write a negative review on TrustPilot. From marketing campaigns that create clicks to having the right stock in the right place at the tight time. To sourcing, shipping and warehousing. All this must fall into place. And then: through outdated, siloed thinking, retailers literally fall at the last mile when the package fails to reach its destination. And just like that – all that work is blown. But it’s not all bad news: customers that have a good delivery experience will return.

The Top 3 customer delivery complaints – and How HubBox helps solve them

As a smaller retailer, it can feel particularly deflating to work on a next-day or even same-day delivery option, only to find your competitors just launched the exact same. However, it’s not all bad news. Ecommerce retailers that utilise technology to create consistently good delivery experiences, that make good on their promises to get that package where it needs to be, at the customers’ request, can steal an edge over competitors. 

Let’s look at some of the most common reasons for missed deliveries – taken from genuine customer data – and how our pickup point software can help overcome them.

Incorrect address information 

Nike: “Paid for delivery. Used DPD. We’re tracking in real time and see they went to the next street, and then sent a message saying sorry we missed you.”

Although carriers are striving to ensure that customers validate the correct delivery information, there’s no getting away from the fact that some erroneous data can sneak through. For example, the sender’s system might not list an up-to-date property directory, so the buyer opts for the closest match. Or, even worse, the sender has to type in their address manually. In this case, the carrier may have, quite innocently, delivered to the next street, all because the customer typed the address wrong.

How HubBox reduces the chances of packages going to the wrong place:There is no lengthy form fill data entry at checkout. All customers need to do is enter their postcode to see a predefined list of suitable locations. This reduces manual data entry and the chances of selecting the ‘wrong’ residential address is significantly reduced.

Broken promises

ASOS: “What is the point of the premier feature for next day delivery anymore? 9 times out of 10 it doesn’t come the next day or even the day after.”

There’s a heap of reasons why packages don’t turn up on time, from delays in the carrier network caused by road blockages and labor shortages, right through to disconnected software systems that mean order information doesn’t pass through quickly enough to be picked and packed in time. 

How HubBox helps improve a brand’s reputation and save customers money: carriers take packages to a central location rather than to the residential address. This makes it easier for retailers to consolidate drop-offs and confidently offer next day, or even same day, delivery. By giving the customer the ability to collect as soon as the goods are delivered, there is no need for the process to fail at the ‘final mile’.

The result: customers don’t feel cheated out of spending the extra dollar in the hope that the goods will arrive faster. They save money, have more control over the process, and are more likely to order from that retailer again.

The safe place wasn’t safe

Shein: “My order over £65 was delivered and left in my bin shed!” 

How HubBox helps reassure customers that products will be kept safe: retailers use a bewildering array of carrier services, or that’s what it can feel like as a consumer. HubBox puts an end to the need for customers to constantly update their delivery preferences by ensuring that all items go to a confirmed location of the customer’s choice. The locations are chosen to be safe – properly safe, with CCTV and employed staff – rather than merely being out of sight (or indeed, left in the bin shed).

How HubBox reduces the impact of lost or missed deliveries on retailer reputation

For all these reasons, over 6,000 locations worldwide are turning to HubBox software. HubBox is a retailer solution that enables customers to pick up their package at a time and place that suits them, which prevents them abandoning their basket online or risking not being home for their delivery.

The HubBox solution is proven to drive conversions by giving customers a dependable alternative to home delivery. Fully customizable, cost effective to implement: HubBox is proven to reduce customer complaints, reduce shipping costs and increase your revenue. Intrigued? Check out HubBox FAQs or book a demo.