As recently as 2016, the state of e-commerce logistics triggered a rush to expand warehousing.
International shipping and fulfillment grew more complex with time, and the demand for more efficient operations replaced the need to develop services. E-commerce takes an added level of finesse to manage, and customers will not hesitate to abandon your company if you cannot deliver. Shippers that take the time to understand the current state of e-commerce logistics in 2018 can learn from the mistakes of the past, devise a top-notch solution for today’s needs, and put several best practices into place to promote efficacy in e-commerce logistics.
Challenges in Today’s State of E-Commerce Logistics
The challenges of today’s e-commerce strategies were formed when supply chain leaders believed the only solution to e-commerce was expansion. While expansion was necessary, it came with a cost. Expansion did nothing to address the rapidly shrinking delivery windows, nor did it have the capacity to handle increased demand when the trucking shortage grew worse following the implementation of the ELD mandate and aging truckers dropped out of the job market. Also, supply chains are still faced with the same problem. They lack the resources necessary to ramp up productivity and efficiency to meet growing demand, which may rise more than 15 percent annually for the next few years, asserts Jeff Berman of Logistics Management. Meanwhile, the costs of operating within the state of e-commerce logistics surpassed $117.2 billion in 2017, and similar increases are already underway for 2018, reports Peter Buxbaum of Global Trade.
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Understanding the Expansion of E-Commerce Logistics
The best way to understand the current state of e-commerce logistics is to think about geometry. Wind inflating a ball, the outside surface of the ball expands, and air is pushing against the inside surface of the rubber. This analogy applies to the expansion of e-commerce and as a result, the expansion of e-commerce logistics. The solution to this problem is to rethink manufacturing and shipping strategies, such as offering 3-D printing, ship to store, using stores as a distribution center and increasing the marketing and visibility of high-volume products. According to Michael Hu of AT Kearney, shippers focused on placing assortment closer to demand, revisiting the topic of last-mile delivery improvements and more. Of course, the state of e-commerce logistics makes it difficult to understand how to take advantage of this record-breaking growth.
How to Take Advantage of the Current State of E-Commerce Logistics
As explained by Ryan Galloway via Forbes, shippers can leverage e-commerce today through these best practices:
- Interact with customers beyond the product page. Creating a thorough product description is only half the battle in converting site visitors to customers. Shippers should interact with customers beyond the product page, such as using chatbot and connecting with customers through social media.
- Include honest issues and offer solutions to consumers’ possible questions. Customers will value the honesty of shippers, even when such honesty contains a negative point about a given product, such as average battery lifespan. Shippers that maintain a robust and honest voice will gain the respect of their customers and position their organizations to succeed within the current state of e-commerce. Go the extra step by suggesting similar products that overcome the initial issue, like a computer with extended battery life.
- Offer customized, personalized products and services. There is not a one-size-fits-all approach to shipping, and the same can be said of e-commerce customer experiences. Shippers need to offer a customized, personalized product and service, which may include personalized last-mile delivery options, such as delivery to work addresses, doorman services, concierge services, and more. Also, shippers must consider products that will be customized and how manufacturing may need to move closer to consumers through 3-D printing and lean inventory management.
- Be accessible to customers. Remember the anger felt when the first voice-recognition systems were implemented, leading to people yelling at their phones, “I said number one!” That feeling will exist within customers that feel they cannot access your company or help. Shippers must be accessible to customers, and with the heightened rate of returns in e-commerce, this is an integral step in mitigating returns for products that are either ineligible for return or could result in cross-contamination, such as health and wellness products. Most importantly, shippers need to make their policies are known and be available to answer questions through social media, email, phone, chat, and in person.
What Does It All Mean?
The state of e-commerce logistics is expanding with the rise of e-commerce shipping and shopping options. As more companies seek to create a seamless customer experience from online to brick-and-mortar stores, shippers must develop an understanding of the tools and resources, as well as best practices, to meet e-commerce and omnichannel demand. Fortunately, third-party logistics providers, such as Cerasis, have already created e-commerce platforms that can integrate with existing e-commerce systems to enable a seamless transition to the realm of e-commerce.