The Height of Madness

The Height of Madness

A recent survey published by IDC and sponsored by Sensomatic, said that 53% of European consumers surveyed would choose to shop elsewhere, if the retailer did not offer same day delivery for online customer orders. This was the 5th highest response consumers gave about when people might desert them. Implementing same day delivery of online orders for most retailers would be the height of madness. In most cases, online orders delivered to customers' homes depress achieved gross margins significantly. The very high return rates with online orders delivered to homes provides further punishment.. 

There are times when it is more profitable for a company to lose difficult or "expensive to service" customers and for most omni-channel retailers, this is one of those times.

Retailers can further improve the situation by developing their systems to identify serial returners and blocking orders from the worst offenders, say those who return two thirds of what they buy, and introducing return charges for those judged to have profit destroying levels of returns, but not as bad as serial returners.

Posted by Brian Hume
26th January 2024

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