1、CommBank Retail Insights. Edition 9 CommBank Retail Insights Report Edition 9 Contents Foreword4 The last mile the customer perspective5 Exceeding consumers last mile expectations6 What shoppers say they want7 Free deliveries can be a win-win8 Is a sole focus on speed misplaced?9 Giving customers ch

2、oice10 Delivery preferences differ between generations11 Case study: Cue Clothing Co.12 The last mile the retailer perspective14 Unlocking the potential of collaboration15 Innovate or be disrupted16 Expert view: GRA Supply Chain Consultants17 Key insights: the retail landscape19 Key insights: the la

3、st mile20 Key insights: state by state view 21 Sector insights22 Food & Liquor23 Take-away Food Services24 Clothing & Footwear25 Homewares & Hardware26 Other Retail27 Learn more28 2 CommBank Retail Insights Report Edition 9 CommBank Retail Insights The last mile In this edition of Retail Insights, w

4、e explore the dynamics of retail delivery and pick-up services, including consumer preferences and behaviours and the opportunities for retailers to optimise these services to attract and retain customers. 3 Foreword Many retailers are grappling with how to effectively provide the delivery and pick-

5、up services that consumers demand and, in most cases, online shoppers see room for improvement, particularly the younger generations. This may be contributing to relatively stagnant growth in online sales. Our data indicates that online retail sales have been hovering around 30% of total omni-channe

6、l retail sales volumes since January 2017, defying regular retailer forecasts for further growth.1 The tepid consumer response isnt surprising. An estimated 23% to 35% of online deliveries fail on the first attempt due to customers being absent.2 This correlates with the fact that 21.6% of people in

7、 couple families live in households where both partners work full-time, and 21.7% with one person working full-time and the other part-time.3 In these cases, they are simply not at home to receive deliveries. When building out delivery services, retailers have tended to balance the cost of offering

8、deliveries against getting parcels to their customers as quickly as possible. However, this doesnt always align with what consumers want. In many areas, consumer expectations are significantly outpacing what retailers offer. What consumers look for most are free deliveries and returns. Greater choic

9、e and visibility closely follow. They want updates on the status of their shipments and the ability to amend details of their order or delivery address. Consumers place more value on features like these than on receiving their parcels within a matter of hours. It may seem contradictory that while co

10、nsumers say they want lower cost deliveries, their satisfaction is more closely linked to reliability the fundamental need for items to arrive when expected. According to retailers, consumers are in fact bearing the cost of most deliveries, a clear signal that shoppers are willing to pay when they s

11、ee the value. So rather than doing more of the same, as most retailers intend, there is an unrealised opportunity to innovate and close the gap between current offerings and shopper expectations. Numerous technology solutions such as GPS tracking, smart lockers and the Internet of Things offer consu

12、mers the choice theyre after. Currently though, only a few retailers are planning to deploy these solutions despite a groundswell of Australian consumer trust in many delivery innovations and evidence of successful adoption in many offshore markets. From my own experience overseas, other markets are

13、 better balancing this under-appreciated consumer need for choice with speed. Consumers in the US, UK and many European countries have already come to expect more choice and control when it comes to their deliveries. Inevitably shoppers here will expect it too. Retailers that dont demand innovation

14、in their last mile offering risk falling further behind their customers expectations. Those that do, have an opportunity to be at the frontier of last mile excellence. As always, wed love to hear from you about your own retail experiences. If youd like to learn more about how you can put our insight

15、s into practice within your own business, please get in touch with our team of retail specialists. Jerry Macey National Manager, Retail Industry Business and Private Banking Commonwealth Bank of Australia About CommBank Retail Insights CommBank Retail Insights is an exclusive, wide-ranging analysis

16、of the Australian retail sector. This edition is based on two surveys conducted by ACA Research on behalf of the Commonwealth Bank. An online quantitative survey of Australian retailers in July 2019, involving 580 decision-makers from small, medium and large retailers across Australia, with turnover

17、 ranging from less than $1 million to over $500 million. Results have been categorised into five retail sectors: Food & Liquor, Take-away Food Services, Clothing & Footwear, Homewares & Hardware, and Other Retail (e.g. books, games, music, consumer electronics and computers, etc.). An online quantit

18、ative survey of 1,505 consumers in July 2019 who had purchased an item and had it delivered or picked up in the past three months, segmented by generation as follows: Gen Z, aged 16-23 years (9%) Gen Y, aged 24-36 years (26%) Gen X, aged 37-52 years (25%) Baby Boomers, aged 53-71 years (28%) Pre-Boo

19、mers, aged 72 years or over (12%) Consumer data has been weighted to ensure the results are nationally representative. 1 CommBank Retail Insights editions 4, 5, 6, 7 and 8 (these show that online sales as a percentage of multi-channel retailers total sales have ranged between 25% and 29% and that re

20、tailers forecasts for the percentage in the next 12 months have ranged between 31% and 35%) 2 .au/uploads/resource/126-Last-Mile-Fulfilment-Whitepaper-2018.pdf Page 4 3 www.quickstats.censusdata.abs.gov.au/census_services/getproduct/census/2016/quickstat/036 CommBank Retail Insights Report Edition 9

21、 Release date: November 2019 All statistics and references to consumers and retailers in this report are based on the responses to the survey unless otherwise stated. Definition of the last mile The delivery of retail goods from a store or transport hub to the shopper. 4 The last mile - the customer

22、 perspective Cost matters most to consumers Getting packages to consumers quickly is a focus for most retailers. However, cost, choice and visibility of deliveries trump speed when it comes to consumer preferences. 5 CommBank Retail Insights Report Edition 9 Exceeding consumers last mile expectation

23、s The fact that futile deliveries remain a feature of many consumers online shopping experience highlights the challenges facing retailers seeking last mile excellence. As retailers remain intently focused on getting goods in the hands of consumers as quickly as possible, shoppers place more value o

24、n free deliveries and the choice of when, where and how they receive their packages. This misalignment could partially explain why many Australian shoppers are only moderately satisfied with the delivery service they receive, with 47% saying they are only somewhat or not satisfied. It may also expla

25、in why retailers perennial forecasts for growth in online sales havent materialised over the past two to three years. Despite the opportunity to improve the status quo, most retailers intend continuing with their current offering with a marginal increase expected in areas like parcel lockers and pic

26、k-up from locations other than the store from which their customers order. Australian retailers are also contending with last mile advances in offshore markets that are shaping consumer expectations of delivery. To meet this, and the existing demand for greater choice and control over shoppers deliv

27、eries, retailers can benefit from working more closely with delivery service aggregators and logistics providers. Through remaining open to innovative delivery solutions that align with consumer expectations, retailers have an opportunity to set a new benchmark. This has the potential to support bet

28、ter customer acquisition and retention and help restore online sales growth. Online sales from multi-channel retailers The proportion of online sales volumes among multi-channel retailers has remained relatively steady since 2017 Delivery and pick-up services on offer Retailers plan to make minimal

29、changes to delivery services in the next 12 months CommBank Retail Insights Report Edition 9 “ The focus on minimising the cost of deliveries is letting down customers and retailers. Instead, retailers should be seeking to better understand consumers needs and expectations and their willingness to p

30、ay for the features they value.” Jerry Macey National Manager, Retail Industry Business and Private Banking Commonwealth Bank of Australia Jan 17 Aug 16 Jan 16 Aug 15 Feb 18 Jan 19 Jul 17 Jul 18 Jul 19 29% 24% 22% 18% 25% 26% 29% 28% 31% Deliver to address provided by the customer Pick-up from wareh

31、ouse Pick-up from another store, but same chain Deliver to a parcel locker Pick-up in the store they ordered from Current In 12 months time 68% 68% 15% 18% 25% 28% 18% 23% 53% 51% 6 What shoppers say they want Faced with having to offer last mile solutions to meet customer needs and expectations, re

32、tailers have understandably concentrated on minimising cost while getting parcels to their customers as quickly as possible. As a result, most delivery options are calibrated by speed. However, according to consumers, speed ranks as the least important factor they consider when choosing a retailer.

33、Shoppers say they are cost conscious first and foremost, then value having the ability to control the delivery options that support reliability. Shoppers prioritise these factors as follows: Delivery service features most important to customers Cost is the most important delivery factor for shoppers

34、 when choosing a retailer CommBank Retail Insights Report Edition 9 “ The consumer desire for more control over deliveries is under-appreciated. This presents an opportunity for retailers to innovate to meet customer expectations and align the last mile experience with the best of whats on offer in

35、other markets around the world.” Jerry Macey National Manager, Retail Industry Business and Private Banking Commonwealth Bank of Australia Extremely important Not very important Somewhat important Not at all important Cost is extremely or somewhat important to 89% of consumers This covers free deliv

36、ery options and free (and easy) returns. Choice is extremely or somewhat important to 67% of consumers This category includes features that give customers the ability to access customer service through different channels, to receive updates about delivery status and location, to amend purchases and

37、pick-up/delivery details and to choose preferred delivery timeslots. Time is extremely or somewhat important to 49% of consumers This covers fast/express delivery options, plus the ability to have items delivered after-hours or on weekends. Cost Choice Time 50% 21% 15%34%34%17% 46%24%9% 39%8% 3% 7 F

38、ree deliveries can be a win-win Although free delivery options are the top delivery feature consumers look for when choosing a retailer, the retailers they shop with report that consumers currently pay for 58% of all delivery costs. Some retailers have worked hard to understand what is driving their

39、 delivery costs and customers propensity to pay. This has enabled them to develop a value proposition that works for both parties. Many shoppers spend time and effort looking for free deliveries (and returns) and some retailers are responding to limit the potential of losing customers to competitors

40、. Its no coincidence that more retailers plan to offer free deliveries for loyalty/subscription members or specific promotions. Free (and easy) returns also heavily influence consumer choice of retailers. Again, retailers are aware of the opportunity. Recognising that return policies are a powerful

41、customer acquisition and retention tool, 78% offer at least some free return options. Options customers choose to avoid fees To avoid delivery fees, consumers use a range of tactics at least sometimes CommBank Retail Insights Report Edition 9 “ There is a lot of pressure from a cost perspective, so

42、I think there will be significant change. I anticipate a collision between convenience and costs, how that is measured and ultimately, who bears that cost.” Shane Lenton Chief Information Officer, Cue Clothing Co. Retailers report 6% of items are returned on average. More detailed product descriptio

43、ns, tools and better imagery could help customers make more accurate choices. Only 32% of customers say items always exactly match the description. Delivery fees charged to consumers More retailers plan to offer free deliveries for loyalty members and promotions Above a certain spend Specific promot

44、ions/ flash sales For standard delivery times (not express deliveries) Free delivery with first order For loyalty/ subscription members Current In 12 months time 66% 19% 18% 15% 15% 61% 28% 18% 16% 23% Choose the standard delivery option Monitor for promotions and flash sales Choose a different reta

45、iler Spend more to reach free delivery threshold Choose a different delivery method 82%79%64%59%59% 8 Is a sole focus on speed misplaced? Fifty-eight percent of retailers offer delivery timeframes ranging from within two hours to next-day deliveries. The proportion is set to top three-quarters of re

46、tailers in the coming year. Yet express deliveries sit near the bottom of the delivery features that consumers consider when choosing a retailer, and the pursuit of faster deliveries can add considerably to retailers costs. Across all generations, only 7% of consumers say they are willing to pay for

47、 express deliveries within a couple of hours and 8% for same- day delivery. As expected, the need for speed is greatest among Gens Z/Y, but they are the groups least willing to pay for it. But far more than speed, consumers want their items to arrive at a time that is convenient for them. The abilit

48、y to choose their preferred delivery timeslot is one of several delivery features that consumers value because it gives them greater control around their deliveries. Given that control supports reliability, one of the most significant drivers of satisfaction with deliveries, this has the potential t

49、o positively influence their willingness to pay. CommBank Retail Insights Report Edition 9 Consumers deem important Retailers offer Flexible delivery timing Retailers focus is on express deliveries, where consumers want to choose timeslots Ability to choose preferred timeslots Fast/express delivery Weekend delivery After-hours delivery of consumers say choosing their preferred timeslot is important. Only 24% of retailers offer this.63% 63% 50% 44% 42% 24% 58% 29% 21% 9 Giving customers choice Other elements relating to customer choice inc