E-commerce grew 20% for Costco in fiscal 2015—20 times faster than store sales.
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Some e-retailers, Marinkovich says, include coupons or other deal information within the shipping e-mails. "E-retailers are used to investing at the front end of the buying experience to get consumers to make the purchase, now they're saying why not carry that experience through and make a lasting impression on them," he says.
Since Asos only began selling in the U.S. early last year, Hill can't directly attribute its U.S. sales growth—150% over the last 12 months—to its shipping efficiencies. But he says "where's my order" inquiries from U.S. consumers have dropped by more than half since Asos began sending the tracking alerts through Newgistics in November 2010. The number of packages lost in transit also dropped, while the number of repeat buyers has increased. "The tracking builds confidence with consumers; once they've used it they generally come back to us," Hill says.
An e-retailer much more familiar to U.S. consumers, Amazon.com Inc., gives customers the option to sign up to receive a similar set of alerts via text message to their mobile phones. The Text Trace program sends messages when an order ships, is out for delivery and when it is delivered, regardless of the shipping carrier Amazon uses. For consumers who don't use Text Trace, Amazon sends only one e-mail when the order ships that contains a tracking number.
The UPS My Choice program sends consumers who sign up for the program alerts on all packages being shipped via UPS to their address. The first alert arrives about 24 hours before a package is scheduled for delivery, giving a consumer just enough time to make changes before a package is placed on the delivery truck, says Stuart Marcus, UPS marketing director.
Rather than find a missed delivery tag on their door, consumers who know they won't be home to accept delivery can pay UPS a $5 fee per delivery to have that package rerouted to another address or to a UPS Store location where they can pick it up. Consumers also can schedule to have UPS deliver the package within a two-hour window they select, also for $5.
UPS does not charge the shipper any additional fees for these services and says it developed the program to make residential deliveries—about 35% of its business today—more convenient for consumers. UPS says My Choice isn't intended to ultimately lower shipping costs charged to shippers.
E-retailers also are testing delivery options for consumers who are rarely at home during regular delivery hours or find home delivery inconvenient for other reasons. Walmart.com, in addition to its Site to Store program that offers free shipping to customers who pick up online orders at a local Wal-Mart store, also recently expanded a test program that lets consumers have Walmart.com orders shipped to one of 650 FedEx Office retail locations in approximately 15 metro areas, including New York, San Francisco-San Jose, Chicago, Boston, New York, Portland, Seattle and Minneapolis. A Wal-Mart spokesman says many of the urban markets the FedEx test is running in already have Wal-Mart retail stores, but consumers say in post-purchase surveys that the No. 1 reason they select the FedEx Office location as their pickup point is convenience. 26% of retail chain operators listed in Internet Retailer's Top 500 Guide offer some form of a buy-online, pick-up-in-store option.
Amazon.com, too, is testing a new retail store delivery option for urban consumers in Seattle, New York and London. The Amazon Locker delivery program lets consumers in these areas select at checkout a local pick-up location for their online orders. Packages are then delivered to secured lockers installed at local retail shops, including drug stores, convenience stores and grocery stores. Amazon e-mails codes to consumers they can enter to unlock the locker containing their delivery.
E-retailers and shippers say consumers increasingly expect to have real-time delivery information at their fingertips and options on how they take delivery. "We are reaching a point in time," QVC's Hunter says, "where consumers will question doing business with a retailer if it doesn't offer this level of service."