You must stand out to survive in this world of booming ecommerce brands. And part of surviving is understanding that the customer is king. Customer experience has emerged as one of the leading drivers of success for brands that sell online. Leveraging supply chain technology can help you meet — and exceed — customer needs and expectations, winning you customer loyalty and repeat revenue.
There are four common touchpoints where the supply chain and customers intersect: discovery, purchasing, delivery and returns. You can use supply chain innovations at these touchpoints to tweak your processes, improving your customers’ overall experience so much that your brand wins fans for life.
This article explores these common touchpoints and discusses how your ecommerce brand can leverage supply chain technologies to stand out from your competitors.
The discovery experience
Your supply chain can be more than the mechanism of moving orders to customers. The supply chain is often thought of as back-of-the-house processes and technologies but doing something innovative with your supply chain could bring customers to your business.
Here’s an example. ThredUp — an online thrift store — and retailer Madewell have partnered to leverage the supply chain as a differentiating factor. At Madewell retail locations, patrons can request a ThredUp clean-out kit to fill with previously worn or purchased clothes to send to the online consignment store. Once at a ThredUp distribution center, the clothes undergo an assessment process where they’re inspected and assigned value to be resold on ThredUp’s online store. Then, customers receive a Madewell gift card that reflects the value of the returned clothes.
What makes this partnership so great is that this upcycling process is driving people to both brands. Madewell and ThredUp are leveraging the reverse supply chain to promote the circular economy and increase customer loyalty, especially when customers are increasingly choosing to support brands that employ sustainable practices. This partnership drives awareness, reduces clothing landfill waste and instills customer loyalty because of a stellar reverse logistics operation. Plus, when a shopper is equipped with a Madewell gift card, they’re more likely to shop there. And there’s a high chance that their total purchase cost will exceed the gift card amount, making Madewell money.
The purchasing experience
There have been many major innovations in payments and checkout experience technologies that ecommerce brands can use to differentiate themselves. This functionality helps make the purchasing and checkout experience easier for your customers, and Shop Pay is an excellent example.
Shop Pay is Shopify’s accelerated checkout method. Once a customer makes a purchase at one brand that uses Shopify, the customer’s shipping and payment details are saved by Shopify in the background. Then, the next time that customer purchases from a merchant using Shopify (even if it’s a different store), the customer can be sent a one-time code, and their details are automatically retrieved without requiring the customer to log into an account. From the customer experience side of things, it’s so much simpler to complete their purchase. And as we all know, once a customer has decided to buy, the customer and brand want as seamless of a checkout experience as possible. Shop Pay securely enables this. And not only is this convenient, but this experience also increases checkout speed by 4x.
Other technologies are trying to digitize impulse purchases, including the one-click solution SmartCommerce. These technologies make it as easy as possible for customers to buy, but some brands are trying to master the sell-up. For example, when a customer purchases a product, they might see recommendations of what they can add to their cart without impacting the anticipated delivery date. This is because these payment systems can connect with a fulfillment center’s API and know what related products are being stored in the same fulfillment center. That way, the customer purchases more products (increasing average order value and overall revenue) while marginally increasing shipping costs because the products are all shipping from the same distribution center.
The delivery experience
Two-day delivery has become the norm and the expectation. But how can products get to someone’s door that quickly? Smart fulfillment networks, like Saltbox, Amazon Multi-Channel Fulfillment and Shopify Fulfillment Network.
Smart fulfillment networks are logistics systems that use cutting-edge technologies to optimize the order fulfillment process. These networks are designed to provide greater efficiency, speed and accuracy in getting products from manufacturers to customers. In a smart fulfillment network, products are stored in strategically located warehouses to give ecommerce businesses a competitive advantage by providing a highly efficient, fast and accurate way to fulfill customer orders.
But how do these fulfillment networks work? Brands send all their orders to these networks. The networks then leverage intelligent systems to learn where demand for certain products comes from and naturally optimize the storage of goods to fulfill quickly. From the brand’s perspective, they don’t have to worry about where they store their goods — that is handled automatically. Plus, some of these networks can send recommendations to the brands, such as “Your product XYZ is selling really well, and based on historical trends, we recommend you increase your storage of this product by x%.”
There is another important delivery-related customer demand ecommerce brands need to account for: Customers want their orders delivered ASAP but also want to know where their order is. Ecommerce brands can elevate the customer experience by updating their customers on their orders’ location and progress via email notifications and alerts.
While Amazon has been doing this for years, many smaller up-and-coming brands are hampered by legacy technology and old-school 3PLs. You can share updates with your customers by integrating your warehouse management system with systems that automatically monitor updates to orders and proactively send customer notifications on order status changes. That way, your customers know when their package has been delivered, lost or if their neighbors took it.
MOO does this well. We order business cards from MOO and get notifications when our orders are received, printed, packed, shipped and delivered. They email us when an order gets delivered — even before our coworking space alerts us that we have a package.
The returns experience
It’s a tale as old as time. A customer receives an order but no longer needs it and wants to return it. Data shows that if you create a solid returns experience, 92% of customers will buy from your brand again. Because of this, ecommerce businesses must provide stellar returns experiences.
Optimizing the reverse supply chain can be a secret weapon, especially for ecommerce brands. After all, online retailers’ return rates hover at more than 20%, compared to their brick-and-mortar counterparts’ return rates of 9%.
Returns management is a crucial component of the customer experience, and being able to initiate a return online or via a portal is becoming increasingly important. You can create a seamless returns experience using Narvar, a post-purchase customer experience platform, or create an online portal that directs your customers through the returns process. When the returned product is on its way, you can share order tracking information with customers so they can stay updated on their order’s progress.
But sometimes, it might be better for the customer not to return the product. One of the aspects that makes returns management challenging is the complex decision logic that goes into deciding what happens to the product, both when it’s received back at the warehouse and before the customer has even returned it. Say, for example, that wholesale prices have plummeted. At that point in time, you would lose money paying for the customer’s return shipping and trying to wholesale the product. Some return management solutions can connect to real-time data sources to pull information (like current wholesale prices) to determine whether a customer should return or keep a product.
Whether the return makes it back to you or not, the critical aspect is making the returns process easy for your customer. Because they have bought from you before, and you want them to buy from you again.
Supply chain as your competitive advantage
The end-to-end supply chain is full of opportunities to boost customer experience. From little tweaks to more significant upgrades, ecommerce brands must take advantage of the innovations coming out of the supply chain industry to stand apart from the competition.
Using the supply chain as your competitive advantage has many benefits, including increasing operational efficiency, saving time and reducing costs. What are you waiting for?
About the author: Jonathan Porter is the founder and CEO of PorterLogic, the supply chain stack for ambitious brands. After graduating with a degree in Industrial and Systems Engineering from Georgia Tech, where he was also a Denning Technology and Management scholar, Jonathan spent his career working with supply chain and business intelligence software at large, established firms — such as Manhattan Associates — as well as startups. He founded PorterLogic in November 2020 to help high-growth brands better manage their supply chain operations and fill gaps across their entire value chain. Follow him on LinkedIn to stay current on supply chain innovations and trends.
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