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Descartes’ Annual Ecommerce Study Shows Online Buying Grows but 67% of Consumers Face Delivery Problems

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Global Logistics, Global Trade Daily, News

Descartes’ Annual Ecommerce Study Shows Online Buying Grows but 67% of Consumers Face Delivery Problems

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ATLANTA, Georgia and LONDON, U.K. May 7, 2024 (GLOBE NEWSWIRE) — Descartes Systems Group, the global leader in uniting logistics-intensive businesses in commerce, released findings from Online Buying Grows, But Too Many Consumers Still Experiencing Delivery Woes, its third annual consumer sentiment study of ecommerce home delivery. The study shows that 39% of respondents made more online purchases in the period surveyed this year compared to last year, and that 57% made purchases in at least one new product category this year. While the study revealed that consumers in every demographic are increasing the volume and frequency of their online purchases, 67% of those surveyed encountered delivery problems. 

Read also: Descartes Releases April Global Shipping Report: March Volumes at Top West Coast Ports Increase Significantly

What’s more, delivery issues were also cited in the study as a potential barrier to future online buying. When consumers were asked what would put them off making more online purchases in the future, 21% indicated they have had negative delivery experiences, 20% said deliveries are not reliable and 17% have been dissatisfied with the delivery process. Additionally, according to the study, 63% of those who experienced delivery problems took some form of action that had negative consequences for the retailer or delivery company (see Figure 1). 

Figure 1: Consumer actions in the face of delivery problems

Source: Descartes & SAPIO Research

“While the third year of this study reveals the industry is achieving small, year-over-year improvements across a number of dimensions related to home delivery performance, the level of consumer dissatisfaction remains high,” said Chris Jones, EVP Industry at Descartes. “Mediocre delivery performance and inconsistent delivery experiences are, however, solvable problems. There are market proven strategies, operational best practices and technology solutions that retailers and delivery companies can consider to cost-effectively provide an optimal home delivery experience tailored to consumers’ delivery preferences.” 

Descartes and SAPIO Research surveyed 8,000 consumers in Europe and North America on their ecommerce buying behavior during the first three months of 2024. The goal was to gain a comprehensive view of the state of ecommerce and home delivery performance by understanding, for example, the reasons for increases or decreases in ecommerce purchases, the different types of goods purchased, the frequency of purchases, delivery preferences, delivery experiences and the impact of delivery failures on retailers and their delivery agents. The study also examines how consumer behaviors and perceptions vary across demographics. For the full report, read Online Buying Grows, But Too Many Consumers Still Experiencing Delivery Woes. 

Learn more about Descartes’ Home Delivery Solutions and its Ecommerce Shipping & Fulfillment Solutions. 

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Amazon Prime Day 2023 Early Results are In, Numerator Reports

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68% of Prime Day Shoppers Extremely or Very Satisfied With Deals; Average Order Size and Household Spend Up From 2022

Numerator, a data and tech company serving the market research space, has published early read results from the first 32 hours of Prime Day 2023. Data is updated throughout the two-day Prime Day event on Numerator’s live Amazon Prime Day tracker and includes: verified spend, order, item and basket metrics; shopper demographics; and verified Prime Day buyer survey data, powered by Numerator’s omnichannel consumer purchase panel.

Prime Day purchase data findings:

  • The average Prime Day 2023 spend per order is $56.64 (compared to $53.14 from the same period on Prime Day 2022). So far, 39% of orders were placed for $20 or less, and 30% were for more than $100.
  • Over half (57%) of households shopping Prime Day have already placed 2+ orders, and 11% placed 5+ orders within the first 32 hours of Prime Day.
  • The average household spend is approximately $134, with 1 in 5 households (20%) spending more than $200.
  • Among the top five items sold, two are household or grocery products and one is Amazon branded: Temptations Cat Treats, Amazon Fire TV Stick, Liquid I.V. Packets, Apple Watch Series 8 and Melissa & Doug Toys.
    • Additional items in the top 10 are the Echo Dot 5, Laneige Lip Products, Celsius Sparkling Drinks, Orgain Organic Protein Powder and Energizer Batteries.
    • On Prime Day 2022, three of the top five items were Amazon branded, and on Prime Day 2021, all of the top five items were Amazon branded.
  • The typical observed Prime Day shopper is a high income, suburban female, age 35-44.

Prime Day verified buyer survey findings:

  • Nearly 9 in 10 Prime Day shoppers (89%) said they were Amazon Prime members, and 86% have been Prime members for more than a year. Four-fifths (81%) have shopped Prime Day events in the past.
  • Nearly all Prime Day shoppers (97%) knew it was Prime Day before shopping the event, and 60% said Prime Day was their main reason for shopping on Amazon today/yesterday.
  • Two-thirds (68%) of Prime Day shoppers said they were extremely or very satisfied with the deals offered this year. 67% said this year’s deals were better or the same as last year, while only 15% felt they were worse than Prime Day 2022 (19% were unsure).
  • Over half (55%) of shoppers compared Amazon’s prices to other retailers before making their Prime Day purchases.
    • 35% compared prices at Walmart, 26% compared to Target, 13% compared to Club retailers, 10% compared to Department stores, 9% compared to Best Buy, 5% compared to eBay and 5% compared to Temu.
  • 65% of Prime Day shoppers said they have or plan to shop at other summer sales— 37% will shop Target Circle Week, 32% Walmart+ Week, 20% will shop Costco’s member’s only sale and 11% will shop Best Buy Black Friday in July.
    • 35% said they do not expect to shop any other summer sales besides Prime Day.
  • Top categories that Prime Day buyers reported purchasing are Home Goods (27%), Household Essentials (26%), Apparel & Shoes (25%), Consumer Electronics (21%) and Beauty & Cosmetics (20%).

Amazon Prime Day 2023: Categories Purchased
Percentage of Prime Day Buyers Responding as of 7/12/23 at 8am ET

Categories Percentage of Prime Day Buyers Purchasing
Home Goods 27%
Household Essentials 26%
Apparel & Shoes 25%
Consumer Electronics 21%
Beauty & Cosmetics 20%
Health & Wellness 19%
Toys & Video Games 16%
Pet Products 13%
Smart Home Devices 13%
Small Appliances 12%
Groceries 12%
Office Supplies 10%

 

Source: Numerator Prime Day Survey

Data on the Amazon Prime Day Tracker will continue to be updated throughout the duration of the Prime Day event. At the time of this release, Numerator purchase data insights were based on 36,079 Prime Day orders from 15,239 unique households. The Numerator Prime Day 2023 survey was fielded to verified Prime Day buyers beginning 7/11/23 and had 1,400 responses at the time of this release. 

About Numerator:
Numerator is a data and tech company bringing speed and scale to market research.  Numerator blends first-party data from over 1 million US households with advanced technology to provide 360-degree consumer understanding for the market research industry that has been slow to change. Headquartered in Chicago, IL, Numerator has 2,000 employees worldwide; 80 of the top 100 CPG brands’ manufacturers are Numerator clients.

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6 Inventory Management Tips for E-Commerce Subscription Boxes

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Subscription boxes offered online can be a viable business model, provided you can give the target market what it wants. Finding the items to stock an e-commerce subscription box with is more complex than it seems, but you can use various e-commerce inventory management strategies to ease the challenges.

1. Surprise People With the Contents of the E-Commerce Subscription Box

Many e-commerce subscription box companies build in flexibility by being upfront about how the contents vary. For example, you might promise they contain products from certain broad categories and tell beauty box subscribers they’ll always receive one item for their skin and another for their hair.

That approach frees you from the e-commerce inventory management challenges of having a minimum quantity of specific products. It also enables supplier diversification.

Plus, subscribers should appreciate being surprised but have accurate expectations about what they’ll receive. People may not always get items they love, but they’re prepared for that outcome.

2. Use Data Within Your E-Commerce Inventory Management Strategies

Data can be powerful for helping you improve the handling of e-commerce inventory management for your subscription boxes. Keeping track of metrics like how many customers you gain or lose per month can make it easier to stay on top of what you’ll need to keep the boxes stocked.

Adventuretown Toy Emporium is a Los Angeles-based toy store with a brick-and-mortar and online presence. It recently announced a customized subscription box tailored to kids aged 0–3. The company sources from 35 countries and puts one or two toys in each box.

People curate the boxes based on data from parents about whether their kids are meeting developmental milestones on time and the experiences the children had with previously received items. Those insights help the people filling the boxes choose relevant goods.

3. Sign Deals With Suppliers or Other Partners

Navigating the e-commerce subscription box landscape usually requires adhering to supplier minimums. That might mean you must buy in bulk from your box supplier. However, before placing an order, it’s better for businesses to see if they can request a sample. If boxes don’t assemble easily, it might not be worth it. Saving 5 seconds per box assembly can make teams more efficient and get products to customers quicker. 

Another possibility is to enter exclusive deals where an in-demand artist creates several box designs you’ll send out in a single month. That’s a great way to increase influencer traction as those personalities make their ever-popular unboxing videos. It also increases anticipation because people will wonder which designs they’ll get.

4. Be Honest About Slowdowns

Anything from bad weather to unexpected product shortages could make it more challenging to send subscription boxes on time. High demand can also increase problems. Even Amazon occasionally experiences them — during the 2021 Prime Days event, customers had to wait two weeks beyond the usual time frames to get an in-demand mini camera.

However, telling customers about any delays as soon as you learn about them is usually the preferable option to staying quiet. Besides informing them about slowdowns, be transparent about what you’re doing to solve them. Relatedly, admit which aspects are out of your control.

If necessary, create a dedicated part of your e-commerce subscription box website that provides the latest information as you get it. That could work better than sending out numerous emails customers may eventually overlook.

5. Provide Limited Choices When Feasible

Some subscription box companies let a restricted number of people choose between two offerings. Perhaps you have a snack subscription service and allow the first 1,000 customers to submit their preferences for either a salty or sweet treat from a particular brand. However, anyone who tries to do that too late will get whatever’s available.

Taking that approach should make it easier to engage with your supplier because you only need a minimum of 1,000 packages of each snack version. Beyond that, you have the flexibility to get whatever option is more reasonably priced, easier to source or has some other desirable characteristic.

However, customers typically like when you give them some options. This suggestion makes it easy to do that without putting too much strain on your supply chain. 

6. Specialize in Recurring Subscription Boxes

Company leaders often find it easier to source an e-commerce subscription box if the contents are somewhat consistent every month. Statistics from 2020 indicated people spent about $74 per month on food and meal kit subscriptions. If your subscription box is that type, you might allow people to choose a certain number of meals for a monthly rate. However, they need to select the ones they want so you can indicate when specific offerings sell out.

This strategy also works well if you have a well-established supply chain network in a particular region. You might sell a coffee subscription box and promise all recipients of February’s box will get an organic blend from a South American roaster. Mentioning that allows you to engage with all your suppliers on that continent to ensure they’ll collectively have enough products to fill the month’s boxes.

It’s also wise to encourage people to sign up for a minimum number of months and give them the option to renew. Knowing the precise number of people signed up to receive six months of a recurring subscription box makes it easier to figure out how to get adequate stock. Clarifying that people cannot cancel and restart their e-commerce subscription box plan at any time also makes inventory more manageable.

Set Up for Subscription Box Success

Managing subscription box inventory comes with specific challenges. However, planning thoroughly and following these suggestions will help you overcome obstacles.

Listen to your customers, too. If they love or dislike certain items, their feedback might be reason enough to prolong or end your relationship with particular suppliers.

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The Key to eCommerce Success: Improving Gross Profit Margin through Effective Strategies

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In the eCommerce sector, gross profit margins (GPM) vary depending on business verticals. While many of the larger sites like Amazon, eBay, and Zillow have GPMs of between 48 and 61%, most other eCommerce businesses’ GPM sits at around 20-50%. 

Regardless of what eCommerce vertical you fall under, your business’s GPM is one of the most essential metrics. It determines your venture’s financial health and profitability within the context of your industry. More specifically, knowing your gross profit margin allows you to evaluate how efficient your production and operational strategies are in comparison to and your leading competitors.

GPM is usually determined as a percentage of your eCommerce business’s net sales. It indicates how much money you’ve made after deducting your direct costs of operating the business, also commonly known as the cost of goods sold.

A financially viable company should have a gross profit margin that allows revenues to cover its costs of production. However, this is the base threshold that you should reach. Ideally, your GPM should leave you with profits at the end of the day to facilitate your venture’s growth and development. In this article, we’ll share the most effective strategies to use to improve your gross profit margin and achieve eCommerce success.

Calculating Gross Profit Margins

Your gross profit margin shows your company’s overall sales performance based on the efficiency of its service delivery and production processes. GPM is calculated by deducting your direct costs from your revenues, then dividing the resulting figure by your revenues and multiplying this figure by 100 to reach a percentage.

Use this formula to calculate your eCommerce business’s gross profit margin:

[(Revenues – cost of goods sold) / revenues] x 100 = GPM

Remember that your gross profit margin indicates how much profit your services or products bring in, per dollar or fiat currency unit, after subtracting the cost of goods sold. This means that it only takes into account the direct costs of sales, and not other operational expenses such as taxes, salaries, and rent and marketing expenses. 

Say, for instance, you pay $20 for a product at wholesale and sell it to your target customers for $40. This would give you a GPM of 50%, as half of the revenues earned were used to cover the direct cost of the product. Ultimately, GPM should be used as a metric to assess the performance and profitability of individual products and services.

Strategies to Improve Your Gross Profit Margin

1: Assess and Audit Your Current Strategies

The only true way to improve your profit margins is to enhance and streamline the processes that could be holding your business back. That means that the first step to boosting your profits is to know exactly how your current strategies work and what plans you can implement to improve them.

Take a close look at your business’s expenditure, product production processes, service delivery processes, acquisition, and retention methods. Also, look at any other critical processes that could be hindering your ability to generate revenues or driving excessively high production costs. 

Assess your expense reports to identify costs that can be reduced or mitigated. Spot gaps in your sales processes that could be leading to a loss of sales prospects and identify ways in which your marketing strategies can be improved to generate more leads and conversions. 

2: Raise Your Prices

Increasing prices may not be a suitable approach for every eCommerce business, but in some cases, it can certainly help to boost gross profit margins. Before you adjust your prices, thoroughly assess your competitors and their pricing structures. 

Find out what they offer, and then offer your own customers something better suited to their needs, be it a niche product or service or an exclusive boutique offering. This approach will allow you to raise your prices while still offering your target audience value that aligns with your pricing.

3: Reduce Your Operating Expenses

Expenses have a direct impact on your GPM, and if you can reduce them, you can improve your profit margin. There are many effective ways to slash your costs, including:

  • Restructuring your staff force and reducing unnecessary staffing where possible
  • Paying invoices on time or early to take advantage of vendor discounts
  • Removing subscriptions or services that are not used regularly from your budget
  • Investigating the possibility of part or full remote work for your teams to reduce office rental and equipment costs
  • Identifying new vendors that can provide more cost-effective products, services or materials compared to your current suppliers. 

You can also use automation tools to reduce your operational expenses without sacrificing efficiency or productivity. Automating processes like billing and invoice processing, accounting, marketing, customer relationship management, and inventory management can free up your team members’ time and resources, allowing them to focus on creative pursuits and expansion plans while AI takes care of repetitive and time-consuming tasks.

4: Update Your Brand’s Identity

If your customers are willing to pay more for your products or services, your profit margins will increase automatically. However, you’ll need to shape your brand’s identity and reputation in a way that compels your prospects to spend more money.

The best way to do this is to position your brand as a premium option within your industry or vertical. You can achieve this by adding extra functions and features to your products that your competitors do not provide, by implementing a prestige pricing system, or by aesthetically redesigning your brand to exude a more high-end identity.

5: Adjust Your Sales Mix

Are there certain products or services in your inventory that perform better than others when it comes to sales? Identify those that provide you with the highest gross profit margins and focus your efforts and resources on marketing them to your target audience. 

Adjusting your business focus may be the key to finding the ideal combination of products and services that maximizes your eCommerce business’s profitability.

The Takeaway

Your gross profit margin will vary widely depending on the nature of your industry, your vertical, and the target audience you are appealing to. With that said, improving your GPM will always result in a stronger business at the end of the day. 

Use the effective strategies listed in this article to refine your approach and give your profit margins the boost they deserve.

 

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Archives, eCommerce, Global Trade Daily

Three-quarters of eCommerce Businesses are still Struggling to Optimize their Payments

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New research from Nuvei and Edgar, Dunn & Company highlights the opportunities Payment Orchestration brings to revenue growth.

Nuvei Corporation (“Nuvei” or the “Company”), the Canadian fintech company, has revealed that three-quarters of eCommerce businesses (75%) say they need greater levels of support to optimize their payments function due to a reliance on an increasing number of payments providers.

This data is available in Nuvei’s latest whitepaper Payment Orchestration: A practical guide to optimizing payment performance. Nuvei partnered with Edgar, Dunn & Company (EDC) to survey over 100 international businesses across a variety of verticals that sell online to consumers.

Capitalizing on the benefits of the multi-vendor model

In an increasingly complex landscape, more than half (54%) of online businesses are now using at least six payment providers to optimize their checkouts as they look to scale into new markets, win new customers, and grow revenue. A third (33%) have direct acquiring relationships with at least five banks.

The rise of this multi-vendor model is a direct result of eCommerce businesses understanding that there is a real opportunity to accelerate growth. Harnessing the power of best-in-class payments technology in every market they operate, and for every relevant payment method, is critical for businesses to optimize their payments performance.

But businesses are also aware that a lack of coordination and optimization of these complex set ups may have a negative impact on their revenues as well, including permanently losing customers. The research shows that 59% of businesses believe that customers who have experienced a false decline will not give businesses a second chance. It also shows that alternative payment methods are becoming more important to eCommerce, with only 23% of online businesses’ checkouts now have three available payments methods or less.

Understanding Payment Orchestration

There is a clear role for payments orchestration in providing the control online businesses need to effectively optimize their backend payments flow. Without Payment Orchestration businesses are unable to set specific and intricate rules for payments acceptance to boost conversion and revenue, and they also do not have full visibility of their performance with which to make informed decisions.

This is evident in the whitepaper research. Businesses told Nuvei they have a variety of specific motivations for implementing a Payment Orchestration solution, including a reduction in the cost of payment acceptance, greater efficiency internally, and a wider acceptance of more payment methods. Many merchants intend to optimize payment conversion with smart routing capabilities to increase revenue.

Nuvei’s practical guide helps eCommerce businesses implement and get maximum value from their Payment Orchestration Platform (POP). When integrated effectively, Payment Orchestration can enable businesses to improve their overall payment performance through enhanced efficiency, security, flexibility, and scalability.

Download Payment Orchestration: A practical guide to optimizing payment performance here.

Methodology

Edgar, Dunn & Company conducted the research in Q4 2022 and in early Q1 2023. This involved conducting primary and secondary research, including the completion of in-depth interviews with large multinational B2C businesses. A survey was also conducted at the beginning of 2023. The survey has been administered online to more than 100 international businesses that sell online to consumers with a sample of respondents working in the finance, payments or commercial fields. The questionnaire included a mix of pre-qualifying information, multiple choices, and open-ended questions regarding their experiences and views on the topic of Payment Orchestration. All data was collected anonymously.

About Nuvei 

Nuvei is the Canadian fintech company accelerating the business of clients around the world. Nuvei’s modular, flexible and scalable technology allows leading companies to accept next-gen payments, offer all payout options and benefit from card issuing, banking, risk and fraud management services. Connecting businesses to their customers in more than 200 markets, with local acquiring in 45+ markets, 150 currencies and more than 600 alternative payment methods, Nuvei provides the technology and insights for customers and partners to succeed locally and globally with one integration.

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Realities of eCommerce Fraud – Can you Protect your Business?

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Commerce businesses have a long history of dealing with fraud. Since the first retailer decided to open its business, a malicious actor was there waiting to exploit them and steal their profit. Even though the industry has evolved and expanded to the digital world, the threat remains the same. 

Fraudsters and cybercriminals are constantly looking for new opportunities for their malicious actions, and the development of eCommerce has opened new doors for them. This is why online security needs to become a priority for every eCommerce company that wants to stay in business and protect themselves and their customers from online dangers. By learning to recognize the signs of eCommerce fraud and developing proper strategies for mitigating the problems, you will be able to stop them before they can cause any damage. 

What is eCommerce fraud? 

The term covers different fraudulent activities in which fraudsters and scammers exploit merchants and their customers for their gain. While this causes significant financial loss for the merchant, this is not the only consequence they will experience. Falling victim to an online commerce scam can also cause reputational damage and loss of trust from current or potential customers. Nobody wants to interact with a company they don’t trust can keep them or their data safe. 

With global eCommerce constantly growing and sales expected to reach $5.55 trillion in 2022, the danger will only become greater. As stated, predictions for e-commerce fraud total losses in 2022 were already high at $41 billion, but 2023 will bring a record high with $48 billion in losses globally.

Before you can start protecting yourself from malicious actors, you must know what you will be dealing with. Let’s look at the most common types of eCommerce fraud online retailers will most likely experience.

1. New cybercrime trends taking over the eCommerce world 

Ecommerce is continuously changing, implementing new technological developments to reach as many customers as possible while providing the best service they can and maximizing their profit. But, unfortunately, they are not the only ones changing. Fraudsters and scammers are also constantly evolving their malicious activities. While there are types of fraud that have been present since the beginnings of e-commerce, such as account takeover or card testing fraud, that will most likely remain one of the biggest online threats; new threats are slowly taking over. From application fraud, BNPL fraud to the use of synthetic identities to commit fraudulent actions, new cybercrime trends will soon start presenting more significant danger than we thought possible. 

2. Chargeback fraud

This type of fraud happens when customers purchase a product or service from your website but request a chargeback from their bank soon after. This might be an example of friendly fraud when the item wasn’t what they were expecting or it wasn’t delivered, but more often, it happens due to fraudsters trying to scam you.

Regardless of the reasoning behind the chargeback request, chargeback fraud has a severe financial impact on the company. They will have to pay the chargeback fees, administrative costs, and banking fees while accepting the loss of merchandise and shipping costs. Sometimes, when a business receives many chargeback requests, their account provider might cancel their contract, considering them high risk. 

3. Card testing fraud

Card testing fraud happens when fraudsters gain access to stolen credit card information and use your website to determine if they work and if there are any funds on it. They use stolen credit card details to make small and low-value purchases, which are harder to notice by either a merchant or cardholder. Once they confirm the card is working, they continue making bigger purchases on your and other eCommerce sites.

Because they are making small purchases, they often go undiscovered until they start making bigger purchases. When anyone gets the chance to react, they can already get away with a significant amount. 

4. Account takeover fraud

Account takeover is a type of identity theft that happens when fraudsters gain access to a customer’s online account and use it for their own advantage. Once they manage to get access to the account through illegitimate means, such as a phishing attack or buying their details from the dark web, they will have their hands free to do anything they want with it. Their options are limitless, from using the account details to breach other accounts that might share the same login details to making purchases or withdrawing funds. 

5. Triangulation fraud

This type of fraud is a severe issue for any kind of eCommerce business. It happens when fraudsters create a fake site or ads that sell your products for a lower price. After the customer purchases that item, fraudsters gain access to their payment details they can use for further fraudulent actions. They use a separate stolen credit card to buy the item from your site and ship it to the customer. Customers receive the item without realizing their payment details are compromised; fraudsters get away with the money while the merchant needs to deal with the aftermath. 

How can you protect your business?

A prevention strategy in place is a must-have for any business dealing with online payments as it takes the whole payment ecosystem to fight it. By detecting and preventing fraud before it even happens, you can ensure your customers’ safety while avoiding any financial loss. 

1. Familiarize yourself with warning signs

The best step for protecting your business from fraud is to identify it before it can cause any damage. Keep an eye on the following red flags, and you will have a better chance of doing it: 

  • Low-value transactions that might indicate credit card testing
  • Customers using different cards for several purchases 
  • Several declined transactions
  • Higher order volumes
  • Billing and shipping address not matching
  • Unusual IP locations

While these potential red flags might just be a legitimate customer having a problem with their card or purchasing a present, it is always better to be safe than sorry when it comes to cybersecurity. 

2. Make sure you have clear and easy-to-understand policies on your website

While you might think that nobody reads your security policies, the truth is that fraudsters are very much interested in them. For example, a badly worded return policy can open the door to various fraudulent activities. Your policies need to clearly state how your business works and your terms and conditions without leaving any space for misunderstanding, especially regarding the refund policy and password policy.

3. Use fraud detection solutions.

Cybercrime is constantly evolving, and it is becoming harder and harder to stay ahead of cybercriminals. To keep up with them and fight back, you must also evolve to give yourself a fighting chance. Many businesses simply do not have time or resources to conduct their own cybersecurity procedures, such as manually checking every transaction, and luckily they don’t have to. Implementing efficient fraud detection solutions can detect, identify, and prevent fraud in real-time.

4. Limit your orders.

Determine your standard order quantity and amount of money spent on average transactions, and limit any order that goes over those numbers. You can either block them entirely from purchasing on your site or contact them with the request for additional verification. 

5. Request proof of delivery 

Request proof of delivery from your delivery partner for every product you sell to ensure your customers have actually received their items. This can significantly reduce the number of chargeback requests from customers claiming they never received a product.

Conclusion

Ecommerce fraud is here to stay, especially with the growth the eCommerce industry will continue to experience. Start taking steps in the right direction to protect yourself from fraudulent activities, especially new cybercrime trends. 

About the Author

Ana Galic is a freelance writer with interests in all things technology such as IoT, fintech trends, big data, machine learning, and cybersecurity. In her free time, Ana is an avid bookworm who enjoys traveling and exploring new places and activities while staying busy with her lifestyle and parenting blog.

 

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Shipping 101 For Ecommerce Platforms

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The ecommerce sales are set to touch 6.5 billion USD in 2021. With the ever-expanding ecommerce industry, the shipping industry is also set for an explosion. Coupled with the changes brought about by technology and dynamic user preferences impacting the ecommerce shipping field, how do you prepare to excel, then? This article will work as a beginner’s guide to tell you all about ecommerce shipping. The world of shipping will no longer be a difficult mystery.

Shipping 101

Here is how you can map out your shipping plan to streamline and organize:

1. Shipping Strategy

Creating a shipping strategy is the first step. Here are the key points you need to consider:

Shipping rates: Will you charge flat shipping rates for all your orders or will they differ from destination to destination? A customer might abandon the cart if the shipping rate is too high, and you might incur a loss if it is too low. Decide on the shipping-rate policy first. You can also increase product prices slightly and offer free shipping.

Inventory/order management: Will you manually update every order and maintain the inventory or will you automate it? Automation is recommended as it minimises the errors.

Global or local? Will you ship across the globe? Or will you ship only in your country? This question is important to answer as it will determine how much you spend on shipping, the carrier you use, the time taken for delivery, etc.

Shipping methods: What mode will you ship through? Air, sea, or land? There might be higher risk and lower shipping cost when you choose sea over land and air, but shipping by air will afford you to deliver faster. Make a list of the pros and cons of all methods to decide.

Shipping insurance: Shipping carriers offer insurance, and this can give you a great deal of security. Get the coverage, especially if you have large volumes.

2. Shipping Costs

While calculating shipping costs, these are the four points you need to keep in mind:

Shipping carrier: Shipping carriers like FedX, Aramex, DHL, UPS are popular with ecommerce companies. But if you are only going to ship locally, ask for quotes from your local carriers, the rates might be much much cheaper. Use the shipping carrier’s calculator to compare.

Source and destination countries: The distance between the source and the destination and whether both the points are in the same country will play a huge role in determining the shipping costs.

Product dimensions and weight: It is advisable to measure all your products before you list them online – every shipping carrier charges depending upon the weight and dimensions of your package.

Margin-wise: Be margin wise. Are the shipping costs too heavy on the pocket? How much profit margin do you want to keep? Shipping is a major expense, and you should never ignore the small charges.

3. Packaging and labelling

You can either source the packaging from your shipping carrier, or use it as a way for branding. With increasing awareness, sustainable packaging is much in demand, but it is also expensive. You can also offer personalised packaging or special packaging for gift orders.

Another important part is the labelling. Each order must be labelled with the order number, the addresses among other details. Doing this incorrectly might result in a mix-up.

4. Invoicing

Many countries have laws that require multiple copies of invoices to be sent with the package. One for you, one for the customer, one for the shipping carrier, one for taxation purposes etc. Invoicing can be automated too. Just invest in good virtual infrastructure.

5. Communication and tracking

Once the order is shipped, most automation software solutions send an e-mail to the customer with the tracking link. This is a very important part of the shipping process. If the customer doesn’t receive communication from your end, it not only looks bad on your company but also might result in complaints.

6. Auditing Shipments

This is the part which most ecommerce companies fail to do. And even if they audit their shipments, they do it manually. Auditing your shipments allows you to claim for refunds from your shipping carrier. There might be duplicate or incorrect charges on your shipping invoice, or the carrier might have damaged or lost your package. You can get reimbursed for it and save on shipping costs.

7. Customs

If you are shipping globally, be well-aware of prohibited items that differ from country to country. Also, the documentation should be spick and span for the package to clear the customs zone. Know about the customs fees and don’t forget to add it to your ecommerce platform, so the customer is not kept in the dark. Most shipping carriers offer information about customs declaration on their websites.

Questions to Ask Yourself Before Making a Shipping Plan

-What is your shipping budget? Will you charge real-time carrier rates for all your orders?

-Will you offer next-day or same-day delivery?

-What packaging will you use?

-Where will you ship and where will you not?

-Will there be a minimum order cost for free shipping?

-How will you communicate regarding the orders with your customers?

-Will you opt for third-party logistics?

-Will you choose automation software solutions when it comes to shipping management?

Quick Tips

-Focus on creating a great customer experience when you package and ship the product.

-Premium packaging can encourage repeat customers.

-If your shipping strategy doesn’t work, always have plan B.

Know the rules and regulations of all the states and countries you are shipping to. Some products might be banned.

Remember to one order might have multiple shipments. That’s double-triple the work.

Outsourcing the logistics and the auditing might save a lot of work, and you can let the experts handle it for you.

There are multiple variables when it comes to ecommerce shipping. Understand, plan and then execute. While shipping might seem like a not-so-important aspect of your ecommerce business as sales, it is actually a driving factor – one that can help you achieve success.

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Ana Shan is a product evangelist at AuditShipment.com, an AI-driven audit service that automatically captures more than 20 carrier errors and helps businesses save up to
16% of their shipping costs.