Introduction
Last-mile delivery is the most critical part of the entire logistics process but also has the most significant impact on customer loyalty.
Suppose you’ve ordered a pair of luxury shoes. You’re already notified that it had left its last distribution hub and was on the way to reach your location. Your excitement level is off the chart.
But as the day progresses, there is no further communication of your order’s whereabouts. You’re left in the dark- wondering where it is and doubting the brand’s legitimacy.
That’s exactly what happens with your customers when you don’t optimize last-mile delivery. But it’s just a sneak peek.
In this article, we’ll go into more detail about how last-mile delivery influences customer loyalty. Plus, we’ll also provide you with some pro tips so you can manage the last leg of the delivery journey in the most efficient way.
What is last-mile delivery in eCommerce?
Last-mile delivery refers to the last leg of the logistics process - where the package finally reaches the end customer from the last distribution hub.
It often includes tasks like route optimization, direct communication with customers, failed delivery management, and so on.
In a nutshell, last-mile delivery encompasses all the activities needed to successfully and efficiently hand over a parcel to the shopper.
When performed right, last-mile delivery skyrockets customer retention rate and improves customer loyalty.
Otherwise, inefficient last–mile delivery operations result in dissatisfied customers and a decline in overall revenue.
How Last-mile delivery impacts customer loyalty in eCommerce
Below, we’ll check some key factors of last-mile delivery that influence customer experience:
1) Speed of delivery
A recent study by Statista shows that around 41% of customers want to receive their deliveries within 24 hours. Another report claims that the global same-day delivery market size is going to touch $26.4 billion by 2027.
These statistics are enough to understand that people want fast delivery. Speed has become synonymous with convenience and loyalty. On the other hand, if they don’t receive the parcel on time, they are less likely to buy from that brand.
As delays mainly occur in the last leg of logistics because of traffic congestion, lack of accessibility, and address issues, efficient last-mile delivery management helps deliver the order to its customers on time. It further contributes to enhancing customer loyalty and improving overall sales.
2) Real-time updates
When the customers hit the buy button, their only concern is, “When will I get my order?” Knowing their package’s whereabouts in real-time empowers them with a sense of control. This also frees them from uncertainty and shows the brand’s commitment to the buyers.
Plus, when they get to know exactly when they will receive the orders, they can plan their day accordingly.
Most of the time, brands send their customers urgent notifications if any problem like delayed deliveries occurs. These minute steps in last-mile logistics help in improving customer loyalty.
On the flip side, when they don’t get real-time notifications, they lose trust in the brand, which negatively affects the shoppers’ experience.
3) Flexibility & convenience
Often, brands let customers choose where and when they want to receive the order. In fact, a few businesses even empower customers to reschedule for urgent scenarios.
Brands that prioritize this level of flexibility build a great relationship with their customers. But if any brand has a rigid delivery process that lacks flexibility, it leads to unsatisfied customers.
4) Issue Resolution
Failed delivery and fake delivery attempts are the two most common challenges in last-mile delivery. When brands take proactive actions on these issues, it highlights that they value customers’ expectations. It, in turn, strengthens customers’ trust and loyalty.
Conversely, if such problems are overlooked, customers may feel undervalued or scammed. It sends them a message that their concerns aren’t a priority, which creates a sense of detachment from the brand.
5) Package and goods condition
How products are being delivered to the customers plays a crucial role in building long-term relations with the customers. Think of getting your favorite showpiece without any bubble wrap and in a broken condition.
Will you ever buy from that brand again? The same happens with your customers. When they finally receive the products after waiting, they expect good packaging and undamaged products.
And when brands meet these criteria, it fosters customer loyalty. If not taken care of these things properly, they lose buyers.
6) Transparent delivery costs
In the last-mile logistics process, where customers directly interact with brands, being transparent about the handling cost is a must.
In the worst-case scenarios, customers face unexpected surprises like additional delivery charges, redelivery charges (in case of failed deliveries), handling costs, etc.
If the brand doesn’t make the customers aware of these extra charges, it degrades their reputation and affects customer loyalty.
7 strategies to manage last-mile delivery for improved customer loyalty
Let’s explore some game-changing tips to optimize your last-mile delivery operations.
1) Go for a specialized last-mile logistics partner
Every carrier has its unique strengths and weaknesses. While some are good in first-mile logistics, some of them are in the market to empower last-mile deliveries.
The specialized last-mile delivery service providers strategically place their distribution hubs across the country. As a result, they can reach customers way faster than traditional carriers.
Apart from that, these companies are specialized in delivering to residential addresses.
It means they can easily deal with potential issues related to home delivery, such as diverse delivery time windows, package consolidation, different delivery preferences, navigating congested urban areas, and so on.
Consequently, they make the final mile delivery more efficient and improve customer satisfaction.
Here are some examples of carriers that offer specialized last-mile delivery services:
- Delhivery
- FedEx
- USPS
- Onfleet
- Starship Technologies
2) Optimize delivery routes
Route planning is a secret sauce of last-mile delivery success that further fosters customer trust in the brand.
Why? It incorporates AI technology and takes into account some factors, such as customers’ locations, delivery time windows, traffic patterns, and vehicle capacities, to find the optimal route for last-mile delivery.
In fact, if any unexpected challenges like traffic congestion or road closure occur, route optimization software can immediately identify them and find alternate routes. These out-of-the-box strategies not only minimize the delivery timing but also help meet customers’ expectations.
Oftentimes, last-mile logistics service providers already come up with built-in route optimization features. You can also integrate dedicated route optimization tools like Rootwarrior and Samsara with your shipping software to avail of the route planning services.
3) Maintain transparency with thorough communication
Providing real-time automated tracking notifications is a no-brainer to improve customer loyalty. But your responsibility doesn’t end after just sending automated updates.
If you want to build long-term relationships with your customers, go the extra mile and blend personalization with it. For example:
- Include a precise estimated time of arrival in the message.
- Provide the contact details of the delivery agent.
- Offer a branded tracking portal.
- Send messages via different channels like Gmail, SMS, and WhatsApp.
- Make them aware of the POD (Proof of delivery) process.
- Send notifications for delivery delays.
Such little adoptions won’t require extra time yet will create a huge difference and make your brand stand out among the crowd.
4) Offer next-level delivery flexibility
Customers want to control their delivery. They want to receive the orders at their preferred timing and places.
Thus, brands that offer flexible delivery processes always stay at the forefront of customers’ minds. For example, Amazon allows customers to change their delivery slots at their convenience.
Here are some other ways you can provide next-level delivery flexibility to win customer loyalty:
- Let the customers choose the delivery time and place.
- Allow them to change delivery location/timing even in the last-mile delivery process.
- Provide contactless delivery if the customer wants.
- Offer delivery services on weekends and holidays.
These services mostly depend on the carrier’s offerings. So, check whether or not your last-mile delivery partner offers these services. If not, switch to another one that aligns with your requirements.
5) Take action on fake delivery attempts & failed deliveries
In most cases, delivery agents fake the delivery attempts and mark them as “canceled by customers” for those orders that fall out of the planned route. It directly harms brand loyalty even if you’re dedicated to customer service.
Thus, ensure to incorporate proactive measures like “OTP-based cancellation process,” “GPS tracking for delivery vehicles,” etc to tackle the problems.
Like fake delivery, failed delivery is another growing issue that needs to be addressed to improve customer loyalty. There are a few shipping software like ClickPost that efficiently communicate with the customers and solve failed deliveries.
6) Harness the power of autonomous vehicles
Unlike human drivers, autonomous vehicles can operate 24/7 and provide unstoppable delivery service - even to the most congested areas.
At the same time, they are eco-friendly. These features are quite beneficial to adhere to customer needs for fast deliveries and sustainability.
Plus, these vehicles are equipped with advanced sensors that keep the products/orders safe from unexpected theft and accidents. You can also go for delivery drones to reach the hard-to-access area.
Amazon’s Prime drone technology (the MK30), for instance, can work in adverse conditions and reach delivery locations within hours.
7) Collect customer feedback after each delivery
This is an overlooked yet game-changing way to improve customer loyalty in last-mile logistics. When you ask for customer-centric feedback, it shows you actually care for your customers.
Plus, when you get to know the areas of improvement, you can better strategize your last-mile delivery services.
For the next time, if they see their feedback is getting prioritized, it fosters trust among them, and they remain loyal over time.
How ClickPost can help you enhance customer loyalty in last-mile logistics
As you already know, you need to efficiently manage last-mile delivery solutions to boost customer loyalty.
But is it possible to manually improve the last-mile delivery process without dedicated software? Not at all.
That’s where ClickPost takes center stage. It offers a single-click carrier integration through which you can easily access specialized last-mile logistics companies. As a result, you don’t need to go back and forth with multiple sites at a time.
From a branded tracking page and notifications for delivery delays to multi-channel communication, you’ll benefit from everything you need to improve customer loyalty.
Plus, automated fake and failed delivery management processes and customer NPS flow will help you build a long-term connection with your customers.
Final Thoughts!
Now, as a retailer, you have two choices: embrace advanced last-mile delivery strategies and watch your business grow. Or neglect it to risk your brand reputation.
If you choose the first one (you must!), you can enhance customer loyalty to a great extent and skyrocket customer retention rates. In this process, if you need additional help, book a demo for ClickPost.
FAQs
1) What are the biggest challenges with last-mile delivery?
The last mile delivery often comes with several challenges. The major ones among them include traffic congestion, maintaining different delivery time windows, and fake & failed delivery management.
2) How does last-mile delivery affect loyalty?
Nowadays, customers want superfast and safe delivery. As most issues like traffic congestion and fake delivery attempts occur in the last stage of the delivery process, efficiently managed last-mile delivery improves customer loyalty. Either way, it results in frustrated customers and a damaged brand reputation.