5 Shipping Trends for Small Ecommerce Businesses To Watch

5 Shipping Trends for Small Ecommerce Businesses To Watch
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Shipping is the final (and arguably most important) frontier when it comes to satisfying customers. Big box retailers have made shipping a priority by routinely examining and revamping their fulfillment methods, resulting in solutions like Amazon Prime, Walmart’s two-day shipping subscription and eBay’s Fast ‘N Free initiative.

Keeping an eye on trends and adopting new, relevant shipping methods will not only help improve customer satisfaction, but it will also help small business owners meet their bottom lines and compete with the big dogs.

Here are five logistics trends and strategies that all retail business owners should evaluate.

1. Free shipping is expected.

According to a Deloitte survey, free shipping is the top priority for shoppers when it comes to retail policies, and nine in 10 shoppers prioritize free shipping over fast shipping when shopping online.

For small businesses to remain competitive, and avoid shopping cart abandonment, they’ll need to strongly consider incorporating free shipping as an option. As all businesses know, shipping is never really free.

On a basic level, there are a few strategies to help businesses cover the cost of free shipping. First, increase product prices to cover shipping costs. In this case, the customer pays. Second, the business pays the full price of shipping. Third, the company slightly increases prices of products to cover some shipping costs, so that both pay a portion.

Businesses can also get creative, offering free shipping when a customer hits a minimum order value. This strategy can help by increasing an average order size; therefore, increasing profits to help offset shipping costs.

2. Deliver packages at a specific time.

Some of consumers’ biggest pet peeves are receiving those “sorry we missed you” postage slips on their front door, or even worse, having a package stolen off their doorstep.

According to a Temando survey, 76 percent of consumers want a specified time slot for delivery, and 37 percent are willing to pay a premium for it. The good news is that the major carriers’ tracking information have significantly improved, helping recipients know where their package is on its route and the estimated delivery date. In addition, most consumers know roughly when their mail carrier arrives each day and can oftentimes plan accordingly.

For even greater control over delivery times, businesses can consider offering local customers on-demand delivery services, such as UberRUSH or Deliv. With these services, shoppers can specify the exact time of day they would like to have their order arrive.

To ship smaller items to out-of-town customers with unusual or difficult schedules, USPS also offers a Hold for Pickup option, allowing the customer to pick up the parcel at a specified post office location. It also offers Package Intercept, which allows customers to reroute their domestic packages if they go on a vacation or business trip.

3. Drones will deliver.

Drones will soon be able to deliver small items to local areas quickly and efficiently. Amazon and Google are investing in drone delivery, among countless other tech companies.

However, there are still operational limitations standing in the way of drone delivery. The Part 107 drone regulations announced recently that it does not cover a variety of operations crucial to delivering packages, such as flying beyond a pilot’s visual line of sight, at higher altitudes and over laypeople.

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So while they’re not buzzing overhead quite yet, business owners should keep drone delivery on their radar to make sure their business is ready to adapt quickly once regulations allowing drone deliveries are in place.

4. More options drive customer satisfaction.

Traditionally, shoppers are given a few shipping options at checkout: standard, expedited and overnight. However, consumers are looking for more flexibility when it comes to how and when they receive their orders.

According to an Accenture study, 66 percent of consumers have chosen a retailer based on the number of available delivery options.

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To avoid shopping cart abandonment and upset customers, retailers should think about adding additional delivery choices such as local pickup, carrier-specific options, same-day shipping and more.

USPS is generally the most affordable option for smaller, lightweight packages while UPS and FedEx are better suited for larger items. Allowing customers to select specified carriers - UPS, FedEx or USPS -- may create satisfied, repeat customers as it gives them some control over the process.

5. Big data transforms shipping.

Business data has been around for a long time, mostly sitting in filing cabinets as an untapped resource. Thanks to new technologies, small businesses can now leverage their data to better serve their customers.

With the right tools, businesses can automatically analyze information, such as pricing histories, mobile device usage, website traffic, locations, parcels’ time in transit and shipping destinations to make informed business decisions. This eliminates inefficiencies and bias; therefore, reducing overall business costs and improving practices.

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There are countless ways small businesses can gather, analyze and make sense of all the data at their fingertips. For example, Endicia uses package data and predictive analysis to guide ecommerce business owners’ decisions, ranging from where to plant warehouses to how to improve delivery for the end-consumer through forecasted shipping costs and time in transit.

By taking a look at where most products are shipped and how long they take to get there, business owners can determine the optimal location for a warehouse that will save the most time and money.

Shipping is a challenging aspect of any ecommerce business and every small business will have different tactics and challenges to create the most efficient shipping strategy possible. Keeping an eye on shipping trends and strategies while implementing and tweaking it as needed, will help businesses determine what works best in order to be successful and competitive with the ecommerce retail giants.