How Retailers Get The Last Mile Wrong

  • Written by  Elizabeth Shobert, StyleSage

0aaElizabeth Shobert StyleSageThe last mile. The final stretch where nothing and everything can go wrong. For retailers, that last mile is an oft under-considered part of the customer journey that can ultimately drag down their bottom line and chip away at customer equity in ways that aren’t immediately apparent. So let’s talk about retail’s last mile problem, as manifested in both the online and offline worlds.

I Don’t Like Surprises

You’ve made all that effort to lure a shopper to your site, merchandise and optimize it based on their needs and behaviors, ensure seamless product selection and checkout, and that’s it. Now you can sit back and watch that order make its way to the customer, right? Not so fast. While it might seem like the lion’s share of the work has been completed on your end, this is only the start of the journey for the customer. And if you don’t play that anticipation right with regularly-cadenced communications and follow-through with on-time delivery, you will have hell to pay.

There’s no rage like that of the shopper who didn’t get his or her merchandise by the time they expected it. I don’t know why, as a consumer, I’m always relieved when I immediately receive that order confirmation email, because things almost never go awry immediately. It’s five days later when there’s been no shipment confirmation, no update, and suddenly I feel like my credit card and I have been ghosted on. Is my package going to someone with the same name who lives five states away? Is there someone in the back gleefully swiping my credit card to the tune of thousands of dollars? I don’t know, and I’m definitely assuming the worst.

All melodrama aside, it’s not just that these negative encounters are amplified within one’s personal experience, it’s that these kinds of mistakes happen all the time. When Peoplevox, a warehouse inventory management provider, surveyed e-Commerce retailers, 63% of these self-reported that they ship orders late because of inventory issues.

There are two issues here. The first part is your backend systems. As analytics providers, we know firsthand that there is a complex maze of systems that your retail operations depend upon, systems that have unique individual purposes, have likely been implemented over different periods of time, and still have to talk to each other.

We won’t stand here and tell you that cross-system integration is easy and quick, but it is imperative. When your online order capturing systems don’t speak the same language as your inventory management system, and you take an order without any fulfilling inventory, you’re going to let that customer down and dial up the likelihood of kissing their future business goodbye. As a customer, I don’t care one iota about your backend systems. I just want my stuff to be delivered when you say it will be. The allure of Amazon aside from competitive prices? Fast, predictable delivery times.

So let’s talk more about those customer expectations. When we talk about proactive communications and follow-through, a customer should know exactly where their goods are in their journey to the final destination. However, not every part of that journey should be considered equal from the perspective of the customer. When the package isn’t yet on the move, it looks like you’re doing nothing. A ratio of one week spent ‘preparing’ an order to a two-day shipping turnaround makes it look like you’re not working very efficiently.

Okay, things will go wrong, but get in front of them. Send an immediate alert giving a clear explanation of what happened and how it will be resolved. The moment a customer has to contact you about an order issue, you are incurring operational and customer loyalty costs that could otherwise have been avoided.

Omnichannel Is A Word Only Retailers Use

When was the last time you heard a non-retail person use the term omnichannel? Exactly. It’s internal industry speak that to the customer means, ‘I want the item without the time and cost of delivery.’ Despite an increasing number of retailers offering a version of ‘buy online, pick up in-store’ services, and major retailers such as Macy’s stating that in-store pickups are their most profitable, there are some major gaps in its execution.

Let’s play a game of ‘he said, she said.’ The retailer says: ‘It’s cheaper and more efficient to bundle those orders with other deliveries to that location.’ The customer says: ‘Why is it taking longer for an item to arrive at the store than to my home address, when I can see for myself that this item is in stock at the local store?’ The point is that the customer doesn’t see two distinct channels; they are simply looking for the most convenient and efficient way to get their desired product. Sure, you can try explaining the reasons for longer delivery, but what do you benefit from rationalizing your backend procedures to customers?

Alternatively, you can find a different and faster way to get orders to the store. We’ll throw the question out there: should inventory sitting in a store exist in an entirely different universe than warehouse inventory? We’re not so sure. If you’re going to do omnichannel, do it right.

Hello, Does Anyone Work Here?

These days I have one of two retail store experiences. It ping-pongs between ‘I’m clearly the only customer you’ve had all day,’ or ‘I guess I’m going to figure out how to run a cash register.’ If you’ve noticed an increasing amount of the latter, well, it likely is related to cost-cutting. So is it possible for retailers to still deliver customer service that makes it worth even going into a store?

The first issue is what results from reduced staffing to cover unchanged square footage and store hours. Namely, there is little time for anything other than the bare necessities, let alone keeping the store from looking like a scene straight out of a real-life apocalypse. Retail Dive’s recent study found that 62% of people choose in-store over online so they can ‘touch and feel’ the products. So if I can’t find the item I want, and it’s coupled with an unpleasant store environment that has me compulsively re-folding sweaters, what’s the point of coming in at all? It’s easy to see store staffing as a quick way to cut costs, but the price to customer loyalty ought to give you pause.

The second and related issue is, if you’re barely able to manage customer checkout, who answers questions and has time to educate themselves about the product they’re selling? You likely guessed it, but the other key reason people come to stores is to get product questions answered from someone who lives and breathes it. Sure, customers can get answers online, but there’s nothing like an informed sales person to give one confidence in their purchase decision.

That last mile we mentioned before? The customer has a choice too; come back for more or divert their loyalty elsewhere. Resources may be increasingly strained, but what remains must prioritize excellent service from start to finish.


Elizabeth Shobert is the Director of Marketing at StyleSage, an e-Commerce analytics solution that captures real-time e-Commerce and social media data to help brands identify and develop the right trends, build out competitive product assortments, and price and promote according to the market. Shobert has been working with retail brands, both in-house and on the agency side, for over 10 years. The heart of her work has been helping brands design products and craft stories that intersect with consumers’ needs and mindsets. Her projects have covered customer experience, strategy, market research, product development and marketing for brands spanning the Fashion, CPG, Technology and Service sectors.

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