by Tom Napier
Most eCommerce order fulfillment systems were not designed to process small quantity orders in high volume, with the speed, accuracy, and flexibility the eCommerce market now demands.
System vulnerabilities become more noticeable under the stress of peak order demand such as orders backed up on a conveyor that need to be on trucks. The bottleneck is most commonly found on lines that operate with manual packing stations.
The cost of labor at this stage of the order fulfillment cycle and during peak order cycles can be staggering, which focuses attention on the need to adopt automation to reduce headcount. However, the more pernicious problem is Customer Retention. Retailers and 3PLs cannot grow without it.
If overall online revenues grow 15 % annually but yours do not, start asking these questions: How many online buyers returned to buy more? How many did not? Did these customers perceive greater value elsewhere? Why?
Clearly, your online customers’ experience with the shipment of their order is critically important to your company’s retention and profitable revenue growth.
According to 20% of frequent online shoppers surveyed: “Long delivery times are the problem most mentioned by online shoppers”...“The most important concerns…reflected in problems encountered by consumers relate to delivery of products purchased online.”
(Source: Consumer market study on e-commerce. Civic Consulting; TNS opinion – Euromonitor International 9-9-2011)
In eCommerce, it is often said that repeat customers spend more per order, contact customer service less often and often share their positive shopping experience with family and friends, leading to customer referrals. Retaining these customers as long-term customers is vital to the sustained profitability and growth of eCommerce companies.
Besides faster fulfillment cycle time, it is clear that in order to optimize customer retention, eCommerce companies will need automated solutions that are capable of personalizing and inserting customized marketing pieces into outbound orders at a reasonable cost. This can only be achieved today through a series of automation projects implemented within a market-oriented strategic planning process.
An automated packing station that concurrently inserts targeted marketing pieces into an eCommerce customer’s order provides the best option for lowest cost per order.
This concept “ain’t” fairy dust. It exists today with PSI’s AutoSlip with collation system. This groundbreaking technology has been implemented into an existing line at a high volume distribution center. Fully automated packing slip with marketing inserts to promote repeat purchases and increase customer retention. A WINNING FORMULA that many eCommerce companies are looking for today.