Rules of engagement
Are Brands concentrating enough on their post-purchase experience? If not, they are missing a key avenue for engagement says parcelLab CEO Tobias Buxhoidt
It is widely thought that the basic principles of customer loyalty and consumer engagement have been put into flux by the pandemic. Search the pages of informative loyalty and retention advice publications and you will find study after study showing that customer loyalty is not what it once was. Some common theories explaining this draw attention to the disconnection with (mostly) online brands; the fact that habitual purchasing does not constitute loyalty and trust, or the struggle to provide truly personalised experiences via the many engagement avenues now offered.
These learnings are not without merit and being agile to change is something brands must always keep in mind. But it is worth stating that some of the fundamentals that undergird a retention strategy have not changed despite the evidently changing playing field of online retail. These include providing genuinely useful content to consumers through initial engagement and reengagement. Being responsive to customer queries and demands rather than ignoring them. And finally, being transparent about the service that the consumer is paying money for. This is more important than ever at times when inflation is surging and the decision to purchase goods or a service may come at a greater cost and with more thought from the consumer. Brands must never take a purchase for granted and must understand their responsibility to be as transparent as possible.
Yet it seems that too many online retailers are ignoring these basic principles by failing to invest in customer experience that is truly end-to-end.
Widespread failure to invest in post-purchase
Nowhere are these failures clearer than post purchase. This thrown around yet often ignored term refers to that moment following the customer clicking the order button but before the parcel arrives at their door. Post-purchase experience is something forgotten because brands believe that their responsibility for orders now lies with a third party and that their opportunity to drive loyalty with customers is gone. Both feelings are misguided and potentially very costly. What’s more, those who heed this lesson could stand to benefit immensely.
Examining the performance of the UK’s top retailers year on year can tell us something about their long-term attentiveness to different areas of the end-to-end customer experience. Our findings have revealed that – for the second year running – brands are failing to meet consumer expectations between checkout and delivery, and generally still providing a subpar online shopping experience post-purchase. Our study examines some of the biggest players in online retail - from Asos to Amazon, Louis Vuitton to Apple. By placing orders and testing the performance across various areas we were able to present an accurate picture of the performance of a retailer in the often-ignored post-purchase space.
What we found was that the size of a company, their public perception as a challenger brand or the relative depth of pockets appeared to be inconsequential when it came to adequate investment in post purchase.
Firstly, nearly eight out in ten retailers put to the test failed to communicate with customers after dispatch of a parcel, creating a blackhole moment between order and delivery. The radio silence, or blackhole moment, between customer and brand is important for several reasons. Orders at this stage are often passed onto third party carriers meaning responsibility for timely and secure delivery is something of an open question - or at least it is in the eyes of the shopper waiting for their parcel. Previous parcelLab research has shown this to be a time of great angst for consumers, who dislike the fact that retailers seem to pass on total control and responsibility to carriers. So why is it that just one in ten of the UK’s top retailers communicated directly with their customer during shipping, with 11% of retailers communicating alongside the carrier.
This demonstrates little thought into the impact of order responsibility at best, and an active choice to use this ambiguity to shift responsibility for orders and engagement onto third parties at worst. Taking active steps to own post-purchase communications, even when third party carriers are used will embed trust in customers and help to promote loyalty in the long run.
A missed opportunity
What’s more, controlling communication between order and delivery is not just important from the perspective of embedding trust in this blackhole moment. It should also be seen as a key opportunity for engaging with consumers in a useful manner.
It is widely acknowledged that post-purchase communications represent an opportunity that has typically high levels of engagement with customers. Emails sent post-purchase often have open rates upwards of 80%, compared with the 20% usually seen with marketing contact.
However, a word of caution - brands should not be opportunistic about these open rate figures by looking to fill post-purchase with run of the mill marketing content. They must keep in mind the longer-term benefits of customer loyalty above and beyond a quick hit extra purchase. Embracing the fact that customers expect to find something useful in this post-purchase correspondence, and that is why they choose to open them at such high rate, is crucial. To continue that sentiment, offering additional information about products purchased, relevant items that they might choose to buy alongside their product or perhaps recycling or returns information are some good examples of content customers might consider useful.
Failing to engage during the post-purchase window clearly amounts to a missed opportunity when it comes to driving brands trust and embedding loyalty. Yet what is worse, is that too many of the brands tested were also failing to provide the very basic information required by customers – information regarding delays. Whilst our research found that the vast majority (89%) of orders were delivered on time, one in ten packages were still delayed. This is not in itself a problem, and consumers are generally understanding especially when headlines are filled with news of global supply shocks and border issues.
However, when delays did occur, brands were still unwilling to communicate this to their customers leaving them in the dark about the status of their order. 70% of the delayed orders were not responded to with information from brands, but rather complete silence – this leaves customers with no way of knowing what had happened to their parcel. It is this sort of radio silence that can drive resentment and mistrust from customers. Customer’s forgivingness only goes as far as brands are willing to earn it via proactive communication, and those that do so stand to benefit.
Global problems demand active responses
Some may respond to these findings with scepticism and point to the fact that if some of the UK’s most path breaking brands are failing to do something, then perhaps it is not worth doing. However, this misunderstands what the value of customer loyalty in the long term truly is. Taking your customers for granted, and taking actions that could brew resentment, can leave brands exposed to the risk of customers ending their habitual purchasing in times of turmoil and fleeing to competitors.
This is especially true in the difficult trading environment with which we live, and with the logistical vortex of challenges retailers have recently faced, it is vital that brands put maximum effort into providing their customer with a first-class, memorable shopping experience.
What is clear is that little progress that has been achieved among the UK’s leading e-commerce brands within the last year when it comes to the state of post purchase. It is surprising, amid the challenges faced by online retailers, that more has not been done to negate these issues and to manage consumer expectations through providing a transparent and efficient online shopping experience. There is clearly a huge opportunity for brands to leverage every touchpoint and maximise direct engagement with their customers. The brands that do this will differentiate themselves from the highly competitive market and will be remembered for it. E-commerce must react and place the customer at the heart of everything they do, providing timely, clear, and proactive communications to their customers.