May 1, 2013, 4:28 PM

Special Report: Special deliveries

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For multichannel retailers, Bald recommends allowing shoppers to return items purchased online to stores. Hermes accepts returns at 14,000 Hermes ParcelShops across Germany and 4,000 more in other countries, such as Austria, the United Kingdom and Russia. Besides being able to initiate returns through any of these facilities, a shopper can choose to have her package shipped to one of these locations to avoid multiple, unsuccessful delivery attempts.

Offering returns through the U.S. Postal Service, which will pick up an item designated for return at a consumer's home, can also make initiating returns more convenient for consumers, says Innotrac's Toner. "The easier it is for a consumer to return an item, the faster the retailer can get it back, process the return and get the item back on the shelf so it can be resold," he says.

Branding opportunities

Once retailers have conquered the basics of accurate and convenient delivery, they can go a step further and turn fulfillment into a marketing channel. While some retailers include a promotional flier about an upcoming sale or a coupon for a future purchase inside the package, some savvy marketers are discovering new ways to reinforce their brand and market to consumers when fulfilling orders.

For example, some merchants wrap items in tissue paper featuring their brand's logo, while others spray a fragrance in the package before it is sealed and shipped and include a branded shopping bag the customer can use to carry other items.

"The idea is to recreate the brand marketing strategies customers experience in a store," Toner says. "Retailers need to think about including their company's colors and branding on the interior of the packaging so customers can instantly identify with the retailer's brand when they open the container."

Other marketing tips include using branded packing slips with marketing and promotional messaging, he says.

An extra touch

While retailers can take advantage of these marketing opportunities all year long, the holiday shopping season represents a marketing jackpot for retailers looking to make an impression on their best customers. Placing items in holiday-themed packaging, adding a bow to the package, or gift wrapping the item free of charge go a long way to deepening brand loyalty, Blair says. Most holiday shoppers, many of whom are pressed for time, appreciate little touches that spare them from having to perform these tasks.

To make this happen, retailers need an order management system that identifies which customers qualify for such white-glove treatment and divert those orders to a packing station in the warehouse designated to provide special services. They should then provide packers with instructions on which special touches to add to each order.

"A retailer's best customers want to feel special and get the same kind of treatment and perks they would receive in a store," says Kiva's Blair. "Being able to offer these kinds of personal touches is what makes fulfillment such an important part of brand marketing."

And retailers need not confine this type of brand marketing to the holiday season. Establishing special service tiers for repeat customers, such as including in the parcel birthday cards or announcements about exclusive sales, can further engender brand loyalty, Blair says.

Making good on a promise

The final piece of the fulfillment puzzle is getting the order to the customer on the expected delivery date. Increasingly, consumers want a specific delivery date, rather than a range, such as delivery within five business days. And they expect retailers to make good on their promise.

In most cases, the best way to reduce delivery time is to locate warehouses at strategic points around the country and fill orders from the warehouse closest to the customer's delivery address. Working with a fulfillment company that operates multiple warehouses and has the resources to establish new warehouses regionally when needed can provide retailers with the flexibility to shorten delivery times.

"Reducing the amount of time an order spends in transit is key to hitting delivery dates, and the best way to do that is to position inventory closer to the consumer," says Saddle Creek's Belcastro.

Regardless of what steps retailers take to reduce delivery times, they always run the risk the consumer may not be home to accept the package when it arrives. In these instances the carrier will either attempt another delivery, provided a signature is required upon receipt, or leave the package at the door if a signature is not required, which exposes it to a theft risk.

Retailers can address these problems by offering different delivery options when the customer places his order. Carriers that make up to four delivery attempts achieve delivery rates of more than 99% in some markets, according to Bald. Having a package delivered to a parcel station or one of the retailer's nearby stores, or allowing delivery to a neighbor are other options.

"The more retailers can do to ensure delivery success the better, because unsuccessful delivery leads to a bad customer experience and lost revenue," says Hermes' Bald.

Retailers that are flexible and nimble when it comes to fulfillment can make each delivery not just satisfactory, but special, and build customer loyalty in the process.

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