Battling Basket Abandonment: Mastering Delivery Choice & Convenience

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10 Minute Read

 

 

Our report (produced in partnership with GFS) highlights key opportunities for businesses in 2023 to adapt their delivery options to reduce basket abandonment during online shopping and what factors are most important to consumers.

Below are some exerts from the report, download the full report to access even more insights and data - Click here for more information 

 

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What can you get from this report?

• A deeper understanding of consumer expectations when it comes to delivery

• Consumer opinons on delivery split by different factors

• Strategies to reduce online basket abandonment 

• Strategies to improve overall delivery system

• Top delivery options for consumers

• Cost of unsuitable delivery options on retail

• An understanding of the pain points for consumers throughout the delivery experience

 

Contents:

• Introduction

• Section one: Unpacking Basket Abandonment

• Section two: The Cost of Failing to Deliver

• Section three: 5 Strategies for Customer-First e-Commerce Delivery

• Summary: Key Takeaways

• Conclusion

 

Introduction

In this report, we explore the critical role that delivery plays, as brands strive to create outstanding shopper experiences within a frictionless customer journey.

In today's hyper-competitive retail landscape, attracting and retaining customers is an immense challenge – particularly with the current economic backdrop. Squeezed incomes have led to more considered purchasing decisions, resulting in a resurgence of physical shopping as consumers prioritise convenience and genuine value-for-money. In this landscape of fragile customer loyalty, the appeal of online shopping is being put to the test. Consumers expect a positive, quick, and hassle-free online shopping experience, encompassing reliable delivery services and prompt returns, and have become intolerant of delays or unnecessary obstacles along the customer journey. For many retailers, meeting these expectations will be the difference between success or failure.

This report explores what customers expect from their delivery experiences and how retailers can meet the constantly shifting needs of shoppers. It offers a comprehensive and data-driven analysis of the challenges and opportunities regarding delivery, providing brands with actionable strategies to improve customer choice and convenience. The report is aimed at retail industry leaders (and related-industry professionals) to help better deliver seamless delivery experiences, and importantly, reduce online basket abandonment.

 

Section One: Unpacking Basket Abandonment

"Everything, everywhere, all at once" – elevated customer expectations in the digital age

Consumer expectations are higher than ever before. Shoppers unconsciously navigate between digital and physical channels, leveraging the latest technologies on the path of least resistance towards the products they desire. The pandemic-induced digital shift led to significant investment in this space, expanding customer choice across every stage of the customer journey. 

Indeed, 80% of UK consumers frequently rely on both physical and digital channels for the same purchase, resulting in increasingly complex, dynamic customer journeys as shoppers pursue the most rewarding experience that suits their personal preferences - whether online, offline or a blend of both.

In this new landscape, where customer journeys are complex and loyalty is fragile, retailers must engineer a seamless, reliable, and frictionless shopping experience. This research shows that delivery choice and convenience is a crucial thread underpinning customer satisfaction, with the potential to ‘make or break’ customer journeys.

 

Fig 1: Delivery choice can ‘make or break’ the customer journey

 

 

Delivery Experience Critical Across Entire Customer Journey

Our research found that 81% of consumers consider delivery options integral to their decision to shop with a non-food retailer.

The influence of online delivery on consumer decision-making starts well before the checkout. In fact, one in three consumers requires knowledge of a retailer's delivery and return options before they consider adding items to their online basket.

Indeed, information about delivery options holds near equal importance to shoppers at the pre-purchase consideration stage as it does the post-purchase and final mile as consumers weigh up their options.

Therefore, it’s crucial for retailers to be transparent and effectively communicate delivery and returns information to customers early in the buying journey. In doing so, delivery can be leveraged as a powerful customer acquisition tool, helping to attract, convert and retain shoppers.

At checkout, delivery options play a crucial role in either facilitating seamless transactions or causing friction that leads to abandonment. Customers expect convenient and flexible choices that align with their individual needs at the time of purchase.

Post-purchase, the delivery experience is pivotal for customer satisfaction and loyalty. Providing estimated or guaranteed delivery times, transparent communication, timely updates, tracking, and reliable performance are crucial in building trust and encouraging repeat business.

 

 

Delivery Disconnect: Retailer Perceptions vs. Customer Realities

Retailers unequivocally recognise the importance of offering customers a compelling delivery proposition.

More than 95% of retailers think delivery options are a deciding factor in consumers’ decision to shop with them. In fact, three in five (61%) retailers consider delivery and return options to be as important to customers as the product itself, even overriding considerations such as price or quality of the product if their needs are not met, leading customers to choose to shop elsewhere.

However, the research highlights a perception gap between what businesses think about their delivery offerings versus what online shoppers actually want. For instance, 83% of retailers surveyed believe that they offer a wide range of delivery options that meet customer needs, but less than half (48%) of consumers agree with this statement.

 

Fig 3: Gap between retailers and consumers’ perceptions of the delivery experience

Source: GFS, Retail Economics

 

The True Cost of Basket Abandonment

£31.5 billion left at checkout as shoppers turned off by poor delivery options

Despite significant investments in enhancing digital and supply chain capabilities since the pandemic, online basket abandonment remains a constant battle for retailers, with delivery-related friction often being the root cause.

One in four (24.8%) attempted online purchases are abandoned by UK shoppers due to a lack of preferred delivery options at the checkout.

Retail Economics modelling shows that online basket abandonment caused by delivery issues costs retailers an average of £605 million per week, as shoppers abort the transaction and seek out competitors who can provide a more seamless delivery experience that fulfils their needs this translates to a staggering £31.5 billion in potential sales which are left at checkout over the course of a year due to multiple delivery-related factors.

Customers' lives are unpredictable and dynamic, which directly affects their delivery needs and behaviours. As such, shoppers require delivery options that cater to their ever-changing circumstances. They expect flexibility, affordability, and timely delivery options, and retailers that fail to meet these expectations run the risk of losing them to competitors offering greater choice and convenience.

In short, by providing a more comprehensive range of delivery options, retailers increase the likelihood of customers converting – and not ‘dropping out’ at the last hurdle.

 

Younger shoppers more likely to abandon baskets due to delivery

 

Shoppers aged under 45 (i.e. Gen Zs and Millennials) have the highest basket abandonment rates. They give up on a third of their intended online purchases due to delivery issues (Fig. 5). This suggests younger customers have higher expectations for delivery options than older age groups and are more likely to seek out alternatives if unsatisfied.

 

Fig 5: Digital natives (under 45s) most likely to abandon baskets

Source: GFS, Retail Economics

 

 

 

 

Section Two: The Cost of Failing to Deliver

 

This section focuses on three key themes to support retailers in shaping their delivery strategies. We explore the complexities of consumer behaviour and delivery personas, emphasize the significance of delivery choice, and highlight post-purchase delivery pain points and the importance of hassle-free returns to enhance the overall customer experience.