How to win the eCommerce battle in Nigeria Africa in 2018
Most people have a story to tell about a new toy that missed a birthday, a gift too late for a wedding or some other frustrating failure of online order delivery. Many of these stories end with: “I won’t be shopping there again.” And as delays increase, so does the number of dissatisfied consumers.
This issue became painfully obvious for eTailers over the most recent holiday season as higher than expected online orders overwhelmed several delivery services1 and led to thousands of angry customers and cancelled orders.
While safe, secure, timely delivery has always been a priority for post and parcel organizations, delivery has never been as essential to the bottom line as it is today. This increasing importance means it now affects pre-purchase decisions just as much as repeat sales. Two-thirds (66 percent) of consumers have chosen between eTailers based on delivery options.
Most alarming of all is the moment of decision, where dissatisfaction with delivery options causes 68 percent of instances where shopping carts are abandoned before orders are submitted.
Selecting the right delivery partner has become a critical business decision for eTailers. Our research, based on a survey of more than 1,000 eTailers across 10 countries (Australia, Brazil, Canada, China, France, Germany, Italy, Japan, United Kingdom and the United States) reveals how digital is dramatically blurring the boundaries between eTailers, marketplaces and delivery providers. It highlights both the new opportunities and the new threats emerging as eCommerce evolves, and why adapting to both—urgently—is critical to future growth.
eTailers get strategic about delivery
Nearly half of eTailers (46 percent) are seeing their online sales growing above 11 percent, while 86 percent are investing in expanding their eCommerce activities over the next 12 months. They are chasing a rapidly expanding market, in which delivery is becoming a critical differentiator and a strategic priority.
Seven out of 10 eTailers (70 percent) use more than one parcel provider to ensure they get the best price (73 percent) and to mitigate the risk of relying on a single provider (68 percent). This makes good business sense, so it is not surprising to see that larger businesses with between 251 and 500 employees, are more likely to use multiple providers.
One-half of eTailers using only one provider had less than 50 employees, suggesting that organizations that win customers in the small business segment have a greater chance of an exclusive relationship. This is a missed opportunity for many post and parcel organizations, with only a few leading this segment.
But beyond small businesses, post and parcel organizations should not expect exclusive relationships. When we asked eTailers to imagine that they had one delivery provider that o‑ered all the services they needed, nearly two-thirds (65 percent) said they would still prefer to work with multiple providers.
From exclusive to primary provider
The aim instead should be to become an eTailer’s primary provider. Our survey indicates that making the jump from the second to top spot would increase parcel volume by 64 percent.
Overall, a high proportion (81 percent) of eTailers are happy with the delivery provider they use the most, perhaps because switching providers has become so easy. In many markets that primary provider is likely to be one of the big three parcel integrators: DHL, UPS and FedEx.
In fact, on average, 71 percent of eTailers in the United States, Canada, Germany and France use one of the big three as their primary delivery provider. Even where these providers are less dominant, they compete strongly across all business sizes in all but two countries: China and Japan, indicating a very di‑erent market in Asia.