The difficulties of last-mile logistics are made apparent each time the holiday season comes around. This problem has been exacerbated by the pandemic, where many turned to remote and online resources, which increased the demand for delivered goods and services. Last-mile logistics are a very costly part of the customer journey, accounting for over 50% of the total cost of shipping. Meaning that businesses have a lot to lose if things go wrong, but a lot to gain when they get it right. And technology can help achieve this.
CX: The grand derby of business
Recently, customer experience has become a critical topic for every business – even in industries that haven’t traditionally prioritized CX as heavily as others, such as utilities. In the past few years, we have seen consumer expectations rise and value shift away from price and towards customer experience. According to research, as many as 73% of consumers who tried new brands during the pandemic intend to continue doing so. Additionally, nearly 74% of consumers are now likely to buy based on their customer experience alone. With the decrease in brand loyalty, CX has become the new frontier to conquer as businesses are no longer competing on price or product – 81% of marketers expecting to compete mostly, or entirely, based on CX.
So, what constitutes a good CX? While this may vary depending on the individual consumer some key attributes include: control (self-service), ease and quality of communication (omni-channel support, proactive information), visibility (insight), efficiency (first-time fix, on-time delivery, knowledgeable employees, etc.), and effective problem resolution. One of the major sources of positive customer experience in this holiday season is efficiency and on-time delivery. Many consumers will be vying to get goods delivered in time for Christmas, this poses a challenge for businesses to provide this crucial element of CX to every customer.
A real-life example of falling at the final hurdle
One personal example that illustrates the make-or-break role that last-mile logistics plays in delivering an excellent CX is my experience of ordering a new, custom-made sofa online. The selection and ordering process was modern and user-friendly, including the ability to order free swatches of their many fabrics to evaluate in person before ordering. You can custom design your piece and, for those looking for financing, that option is easily integrated into the purchasing process.
Once I placed my order, I received an order confirmation email and estimated delivery date (January 21st) along with a “follow your build” email which enables you to check in on the manufacturing of your product for updates from beginning to end. I was later notified with an email explaining that the sofa build was complete and that the next phase would be for the sofa to go to a transit hub, where it could sit for up to a week to synergize shipping with other local purchases. The estimated delivery date remained January 21st. The experience thus far had been very in line with what I had expected from the brand’s fresh and modern persona.
However, when the sofa did not arrive on time, my customer experience completely changed. I called three times and was told the same thing each time, that the company did not have visibility into any order status once the sofa has shipped and that I must await contact from the third-party delivery provider. Eventually, I hunted down the contact details of the logistics provider and contacted them myself. I was told that they had our order information but had not yet received the sofa – the representative was hopeful it was on the order they received at the end of the previous week and just hadn’t been scanned in yet.
The contrast of the customer experience of the sales process versus its service process could not have been greater – the initial phase was so strong that my expectation for a cohesive, positive experience was set, but the lack of visibility essentially overshadowed any of the previous positive experience I received prior to the delivery process. The sofa I eventually received may very well have been phenomenal, but the lasting impression I have of the company overall is quite poor based on my service experience - or lack thereof. This means that businesses can do everything right in the sales experience, but if they neglect the final leg of the customer journey, it can all be completely undone, resulting in permanent damage to brand reputation.
Tech solutions to carry you over the finish line
Technology can play a key role in delivering a cohesive and satisfactory CX. Money, time, and effort can be invested to consolidate systems and reengineer processes to achieve this cohesiveness and keep pace with the type of CX provided by consumer-facing brands like Amazon. Disparate tools and siloed data must be brought together so that the customer journey isn’t fragmented, and the service workforce must be equipped with the information, skills, and resources to deliver the experience you want to be associated with your company’s brand. It’s not an easy feat, but it’s an important one.
Reliance on third-party logistics providers is quite common. This is why it is so important for businesses to take advantage of the benefits that digital solutions offer in terms of asset visibility, connectivity, and cohesive resource management to ensure the use of a third-party doesn’t negatively impact the customer experience.
Remember, CX is not just for Christmas
The reality is, with the technology available to companies to offer a more cohesive customer experience and to have and maintain real-time visibility into its inventory from order all the way through to delivery, this level of disconnect and fragmentation is entirely avoidable.
My experience is not unique and one many customers can relate to. It’s a tangible example that highlights how last-mile logistics affect real customers and have very real consequences. As markets continue to grow more saturated and become more competitive, failing to deliver on the final steps can cause a loss of brand equity winnings. The holiday season is vital for businesses, so it is critical to ensure delivery on CX at every stage, especially in the final hurdle.
