Having a successful ecommerce shipping strategy in place is one of the most powerful steps you can take towards building your business online.
Shipping is a key factor that has a direct impact on the reputation of your ecommerce business. Nearly 53% of shoppers shy away from purchasing if they don't know when their order will be delivered. Not only should employ a holistic order tracking solution for this, but you should also deploy the best shipping methods.
Here’s the deal — when you dispatch products, your customers are bound to experience your shipping process. The shipping and delivery experience could make or break the deal with your customers!
The profound changes brought forth by the pandemic have forced us to change the way we shop. Online retail sales have been skyrocketing — and with the holiday season around the corner, ecommerce sales are expected to grow 11-15% to hit $ 226 billion.
This year, many retailers are encouraging their customers to shop earlier than usual to give them sufficient lead time to fulfill and ship orders. 40% of customers in the US have started shopping earlier than last year, primarily because of the growing media coverage about supply chain, inventory, and fulfillment concerns.
With an increasing number of online retailers, your business needs to stand out amidst heavy competition or stay abreast with your customers’ needs. In such cases, having well-defined shipping methods and return policies can be highly favorable for your business.
In this post, we are going to walk you through:
- What is ecommerce shipping?
- The ecommerce shipping process
- Types of shipping methods
- Types of shipping carriers
What is ecommerce shipping?
Ecommerce shipping covers all the activities related to transporting products bought online from a retailer to the hands of the end customer. With the right ecommerce delivery partner onboard, ecommerce shipping can be quick, cost-effective, and easy to manage.
What does the shipping process entail?
In ecommerce, the shipping process encompasses everything from receiving an order from a customer to preparing for its timely and efficient delivery.
The shipping process can be divided into five simple stages:
a) Order receiving
The first step in the process is to receive the order from your customer. Ensure that you have sufficient stock to fulfill the order.
b) Order processing
This is a collective term used for the activities involved in processing an order made by a customer. Each order is tied to a specific tracking ID. Different teams have different roles to play in processing an order.
For example, the purchasing team closes the purchase order, the inventory team tracks and updates the inventory, and the production team hands over the finished products in time to the packaging and delivery team.
c) Order packaging
This is the third step in the process where the products are packed properly before they are shipped. The main purpose of packaging is to prevent damages in transit. Some of the packing materials include cardboard boxes, bubble wrap, packets, envelopes, etc.
d) Order shipping & delivery
This is one of the most crucial steps in the entire shipping process. Ecommerce brands need to find reliable shipping partners who can ensure smooth and timely delivery for all orders placed.
e) Returns
The shipping process also involves handling returns. When a customer returns an item for some reason, the logistics partner then ships it back to the retailer, and the return process starts from there. Based on the company's return policy, the refund is processed to the customer.
The extensive list of shipping methods brands use in 2022
There are different types of shipping methods that you can choose from. However, there is no concept of one-size-fits-all when it comes to ecommerce shipping strategy.
The shipping strategy that works best for your organization largely depends on your customers, budget, products, profit margin, and several other factors.
Let's take a look at the top shipping methods that you can adopt to delight your customers.
1. Flat-rate shipping
In the flat rate shipping method, an ecommerce shipping carrier assigns a fixed delivery rate for boxes of varying sizes. You are allowed to ship any weight as long as the item fits into the box.
It's the ideal shipping method for small businesses or a standard product line with products of the same size and weight. However, if you choose to expand your product line, the flat rate shipping method might be ineffective.
2. Two-day shipping
Amazon popularized this method of shipment and then everyone else followed suit in offering it. In this type of shipping, a customer can expect to receive their order delivered within two business days from placing the order.
Another example of a brand offering 2-day shipping is Walmart. Walmart offers free 2-day shipping on all orders above $35.
3. Table rate shipping
This shipping method is quite the opposite of flat-rate shipping. It allows you to set different shipping rates based on customer location, weight, size of the packages, and the number of items ordered.
This is an ideal method of shipment if you are catering to customers located in multiple shipping zones and destinations.
For example, a merchant with a warehouse in New York might charge customers within the city a certain delivery cost and different costs for delivering to locations outside city limits.
4. Product-based shipping
Your ecommerce store may have a wide range of products in different shapes, sizes, materials, and durability. In such cases, it becomes crucial for you to define shipping options based on the product.
For instance, if a company wants to transport chemicals from one place to another, it would opt for a service provider like UPS to transport it under safe and controlled temperatures.
5. Overnight shipping
In overnight shipping, a customer places an order one day and receives it the next business day. Overnight shipping is also referred to as next-day shipping or 1-day shipping.
To ensure the products are delivered faster than usual is quite a popular shipping method where customers are not kept waiting to receive their orders. 62% of shoppers in the U.S. stated that "fast shipping speed" is the most important factor that resulted in a positive retail experience.
An example: New Yorker Bagels offers free overnight shipping to their esteemed members of the NYC Bagel Club.
6. Expedited shipping
It is any shipping method that's faster than a standard one. In this type of shipping, to ensure the products are delivered faster than usual, the shipping vehicle moves from the pick-up point to the delivery point directly without making any stopovers.
By offering expedited shipping your store can tackle the issue of cart abandonment, improve customer satisfaction and build customer loyalty.
Dell offers expedited shipping to its customers. This holiday season, Nordstrom is offering its customers expedited delivery so they can get their orders in time for Christmas.
7. Local pickup
This is a great option to include in your store's check-out process. Instead of shipping the orders, you allow customers to head to one of your physical stores and pick up their orders.
This lets retailers save money and time, which would have otherwise been spent on shipping and delivery. It also allows customers to get their items faster. For instance, Tesco allows its customers to collect their orders from selected locations.
8. Eco-friendly shipping
This method of shipment includes the use of biodegradable material for packaging. It includes all the activities involved in conserving energy, using low carbon-emitting fuels for transportation, and minimizing any negative impact that delivering orders might have on the environment.
According to the Environment Protection Agency, packaging accounts for nearly 1/3rd of waste disposed of from U.S. homes. People are more aware today and are choosing companies that use eco-friendly packaging.
An eco-friendly brand for clothing, Upper park offers biodegradable shipping on orders under 32 ounces on the west coast.
9. Hybrid shipping
Hybrid shipping involves using two different logistics partners for shipping your customers’ orders. FedEx SmartPost is the best example of this shipping method.
FedEx picks up the orders and then hands them over to another service provider like USPS that gets your packages to a sorting facility. The packages are then shipped out from there to the customers' delivery address. With hybrid shipping, shipping costs can be reduced to as much as 50%, but the drawback with this method of shipment is slower delivery.
10. Freight shipping
Freight shipping refers to the transportation of goods via land, air, or sea. Any item larger than 30×30×30 inches or weighing more than 150 pounds is usually reserved as shipping freight.
In its latest move to compete with FedEx and UPS, Amazon is shipping nearly 72% of its cargo for outside customers.
11. Conditional shipping
In this shipping method, you restrict the sale of products based on your customers’ location. You can set conditions for some of your store's products to stop customers from buying products that would be too expensive to ship or placing orders for products not available in their region.
12. International shipping
When products are shipped from one country to another, it is referred to as international shipping.
BetterWorldBooks is a U.K.-based company that sells both old and new books. The company offers free shipping around the world, and it takes 10-21 days for order fulfillment.
USA’s top shipping carriers for ecommerce brands
Finding the right shipping carrier for ecommerce is as important as having the right products to sell.
We’ve gone ahead and done the groundwork for you – we’ve compiled a list of the eight best shipping solutions that your business can use right away.
1. USPS
USPS is one of the most popular and frequently used shipping carriers in American ecommerce. This shipping carrier is the perfect option when you need to ship
- Small products that are heavy
- Lightweight items that are bulky
- Packages meant for post office addresses like the Army Post Office (APO) or the Fleet Post Office (FPO)
2. UPS
The United Parcel Service (UPS) has a lot of services to offer that are designed particularly to cater to the needs of small ecommerce businesses. UPS offers overnight, international and ground shipping. They manage returns well and are known for their coverage of a large number of shipping zones.
3. FedEx
FedEx is one of the most well-known names in the ecommerce shipping industry. FedEx introduced the ‘FedEx Small business’ to offer easy shipping solutions to ecommerce merchants. With everyday delivery, packages shipped via FedEx get delivered up to 2 days quicker than with other shipping carriers.
4. DHL
DHL is an international shipping courier known for its global reach and excellent customer service. The company offers international shipping services in more than 220 countries with many options to meet your shipping needs. However,, new ecommerce entrepreneurs may find their services a bit costly.
5. OnTrac
OnTrac is a shipping company offering regional shipping services in the U.S. OnTrac specializes in ground and overnight shipping services and offers a host of shipping solutions to cater to the needs of large and small businesses.
6. FirstMile
FirstMile was established to meet the growing demands of the ecommerce logistics industry in the U.S and across the world. It provides domestic and international shipping and an end-to-end ecommerce solution that covers warehousing, shipping, fulfillment, and returns.
7. Passport Shipping
Passport is a logistics and supply chain company that has redefined international shipping for D2C brands. It has developed global shipping solutions with customer experience at its core to cater to the needs of international customers.
8. Roadrunner Freight
Roadrunner freight is a leading LTL provider offering high-quality services to shippers across major metros in the US. With its 'Ship It Like You Own It' culture, the company provides unparalleled and reliable services to its customers.
Delight your customers with top-notch shipping
Ecommerce shipping calls for proper planning so that your business can taste success in due course.
It comes with a few challenges, but as you identify the right solution for your business and partner with a reliable shipping carrier, you can streamline your shipping process to offer delightful shopping experiences to your customers.