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Capgemini urges retailers to 'go the extra mile' on delivery

Jan 17
Tags: Capgemini
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Capgemini urges retailers to 'go the extra mile' on...

Retailers looking for ways to distinguish themselves and bring in additional revenue should 'go the extra mile' in the delivery phase of the online buying journey, according to a recent study.

A study carried out by the Capgemini Research Institute found that three-quarters of online grocery customers would be willing to spend more and try new offerings in return for satisfactory deliveries.

Only one per cent of consumers said they would be prepared to cover the full cost of delivery.

Business investment in 'last-mile' delivery - the final stage of the online purchase journey before the product reaches the recipient - could improve the customer experience and unlock additional revenue.

However, almost all businesses surveyed (97 per cent) said current last-mile delivery models are unsustainable for full-scale implementation across all locations.

Organisations taking part in the study also suggested that free delivery cannot be maintained unless the costs are reduced through technological innovation and practices such as automation.

Other key findings from the survey of more than 2,870 consumers showed that 40 per cent of people currently order groceries online at least once a week. Projected growth in this market is expected to take this figure to 55 per cent by 2021.

Three-quarters (74 per cent) of respondents who were satisfied with their online shopping and delivery experience said they planned to increase spend by as much as 12 per cent with retailers they frequently purchase from.

More than half (55 per cent) of shoppers said the option of two-hour deliveries would strengthen their loyalty to a retailer, but only 19 per cent of companies currently provide this.

Tim Bridges, global sector leader for consumer products, retail and distribution at Capgemini, said: "The dilemma facing retailers is to provide last-mile delivery services that customers value, without damaging their own profitability.

"If done right, and their last-mile experience can win over customer satisfaction, retailers stand to gain loyalty, increased purchase value and frequency, while mitigating profitability risk through automation and optimisation of fulfilment locations."

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Image: iStock/AndreyPopov

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