The Importance of an eCommerce Fulfilment Strategy for Your Shopify Store
Setting up a store on Shopify is just the first step to taking your business online. Making a few sales on your store is the next. But unless those orders reach your customers, you’re not closing the cycle or running what we call a ‘successful’ eCommerce business.
Yes, we’re talking about order fulfilment, and in this blog, we’re sharing how important it is to have a strategy in place from day one.
Let’s start from the beginning.
What is eCommerce order fulfilment?
In simple terms, order fulfilment refers to delivering the products a consumer has orders from your Shopify store to their doorstep. Essentially, there are 3 main steps involved in order fulfilment - receiving, processing and shipping.
While Shopify makes it easy for one to receive orders, it’s the processing and shipping process that often gets tricky. This is where you need to partner with a shipping service provider that has a warehouse to hold, prepare and ship the orders for you.
Now you’re probably wondering that this is pretty obvious for a business to have. Why are we talking about it?
Also read: When it the right time to outsource fulfilment by Shopify
eCommerce order fulfilment strategy - Status quo
As of today, most eCommerce businesses running on Shopify simply take into account the areas they receive orders from. Then they look through directories to find shipping partners, collating data such as serviceability, delivery speed, limitations on cargo size and weight, delivery mechanisms, proof of delivery, and more.
They do this for multiple shipping partners, every time bringing all their data to the forefront while order allocation to ensure timely deliveries to customers.
While this approach worked for most businesses, the pandemic uncovered a new problem with the strategy. The manual benchmarking led to many businesses not being able to pick the right partner for order fulfilment.
It became harder for them to take into account factors that would impact delivery times or the status in which orders were reaching customers.
Why is it important to recreate your order fulfilment strategy?
If you’re still relying on the age-old tactics, here are a few reasons why you need to relook your fulfilment strategy.
1. It impacts your operational costs
When you rely on manual benchmarking of performance data, you’re bound to miss out on critical factors. Rather, you’re sure to miss out on aspects that are dynamic in nature and may have changed over a period of time.
This results in you not being able to make the right choice of fulfilment partner in terms of the costs involved. In most cases, looking at simply serviceability and delivery speed, you’ll end up overpaying for order fulfilment.
2. It impacts the customer experience you offer
Imagine you place an order from a new brand online. The order takes more than a month to reach you. The first thought in your mind isn’t about how good the purchase is, but a lot of anxiety about whether the order is going to even reach you in time and safely. From a consumer standpoint, your experience with the brand is already compromised.
From a business standpoint, you failed at delivering a great online shopping experience to consumers. All that time spent building a beautiful website for your brand, adding functionalities like virtual try-ons and more, just went waste.
3. It impacts how many customers come back for repeat purchases
If a consumer is continually worried about their orders while making purchases from you, they are less likely to come back to you again. If your fulfilment partner is continually missing estimated delivery times, not keeping customers up-to-date with their orders, or is not taking enough care of the packages as they get handed over, you can expect these shoppers to walk away from you.
They’re not going to blame your fulfilment partner for the experience. For them, the person who delivers their order is a part of your team.
56% of consumers walk away from brands after one bad customer experience.
4. It impacts your overall brand reputation
Damaged deliveries. Untimely deliveries. What does that say to you?
A brand that cannot keep up to its promises to a consumer. A brand that is not reliable.
And for no fault of yours, except not having a fulfilment strategy in place. As statistics suggest, 52% of consumers tell their friends and family about their experience with a brand. You definitely don’t want the wrong word getting out.
What does your fulfilment strategy need to include?
Apart from the obvious things like fulfilment partners for the areas you want to service, there are a few other things you should be including.
1. Leverage a logistics aggregator
Instead of partnering with fulfilment centers and service providers on an individual basis, make use of a shipping aggregator. A shipping aggregator essentially partners with service providers pre-emptively, bringing all their performance data onto one dashboard. This reduces the time you spend collating and benchmarking their data and getting shipping costs from them.
2. Implement a logistics recommendation engine
Stop relying on manual tactics to choose the right fulfilment partner for your orders. By using a logistics recommendation engine you’re able to benchmark partners on more parameters than just delivery speed and serviceability. This ensures your orders are reaching your customers at the right time and the fulfilment services are well within your budgets.
3. Map package movement and health with a data logger
A data logging solution basically enables you to keep track of your packages - where they are and what condition they are in. Your fulfilment partner essentially uses a mobile scanner to keep you up-to-date on things. This way you know the impact a package may have received during transit and you’re able to take corrective measures before it is delivered to the customers. Even if that means updating them about it.
4. Branded tracking pages and order status updates
Now from a consumer’s perspective, your fulfilment strategy needs to include how you’re communicating with customers until the order reaches them. The best way to keep WISMO calls and emails at bay, and order anxiety at a minimum is to implement branded tracking pages on your store. In addition to that, automating your order status updates on email and SMS can further make things better in terms of the customer experience.
Is it time for you to focus on your fulfilment strategy?
If you have been seeing a steady drop in the number of customers coming back to your Shopify store to make another purchase, yes.
If you have been seeing customers reach out to you to know their order status via email or SMS all too often, it’s time to re-evaluate your fulfilment strategy.
If you have been noticing your operational costs increase over time, it is the right time to step back and take a look at your fulfilment strategy again.
Want to know the biggest indicator of your fulfilment strategy not working?
Take a look at your Net Promoter Score.
If you’re seeing an all-time low NPS, it’s an indicator that customers are not happy shopping with your brand. And if your products are up to the mark, it’s likely that it is because of your fulfilment partner that the experience is tipping towards the negative.
Do you have a fulfilment strategy in place for your Shopify store or would you like us to recommend partners that can help you create one?