Sorry for interrupting, this website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Learn more
Accept & Close

Delivery and Returns: Understanding Consumer Needs - US - August 2018

"Expectations around delivery and returns of online orders are changing. Retailers and shippers are investing resources into perfecting the last mile of the online shopping experience by expanding delivery options, decreasing delivery times, and removing some of the pain points from the returns process."

Fiona O'Donnell, Director - Multicultural, Lifestyles, Travel & Leisure

This report will look at the following areas:

  • Comprehensive outbound and inbound shipping solutions needed
  • Fast and free delivery desired – offer options to address individual needs
  • Online shoppers want assurance of many happy returns
  • Proactive updates after purchase is part of the experience

What you get

What's included

Why buy from us?

Succeed

Our reports will provide you with market data, consumer research and competitive intelligence to succeed in your market.

Instant Access

Buy now and you'll have instant access to the information you need to make the right decisions.

Opportunities

Find out what's next in the markets that matter to you: where opportunities lie and what challenges you will face.

Trusted

A business Superbrand, Mintel is a source you can trust. We have been defining and refining the Market Intelligence mix since 1972.

Table of contents

  1. Overview

    • What you need to know
      • Scope
      • Executive Summary

        • What matters most to online shoppers in delivery and returns
          • Balance shopper desire for free and fast shipping
            • Recommendations
              • Invest in understanding “convenience”
                • Recommendations
                  • Ensure secure delivery, customer privacy to enhance trust
                    • Recommendations
                      • Clearly communicate returns policy and process
                        • Recommendations
                          • What it means
                          • Delivery and Returns – What You Need to Know

                            • Comprehensive outbound and inbound shipping solutions needed
                              • Fast and free delivery desired – offer options to address individual needs
                                • Online shoppers want assurance of many happy returns
                                  • Proactive updates after purchase is part of the experience
                                  • Delivery and Returns – The Market

                                    • More consumers are buying online and purchasing more frequently
                                      • Figure 1: Made an online purchase in the past 7 days/past 30 days and mean number of times purchased online in past 30 days,* January 2007-March 2018
                                    • Increasing eCommerce drives need for seamless shipping solutions
                                      • Amazon estimated to account for half of the market
                                      • Delivery and Returns – The Issues

                                        • Shipping issues a top barrier to online purchasing
                                            • Figure 2: Attitudes toward online shopping – Total cost and easy returns, April 2018
                                          • Returns processes need attention
                                          • Delivery and Returns – The Opportunities

                                            • Make everyday essentials part of the online basket
                                                • Figure 3: Shipping fees, delivery times as reasons for not purchasing online – Select categories, March 2018
                                                • Figure 4: Reasons for returning to an abandoned online shopping cart – Free and fast shipping, by age, March 2018
                                              • Address unique shipping issues around smaller (but growing) categories
                                                • Simplify the process and cut through the clutter with bundled delivery
                                                  • Figure 5: Attitudes toward shopping online – Preference to receive all items at the same time, by age, June 2018
                                                • Pros and cons of single-shipment delivery
                                                  • Stay engaged after purchase confirmation, through delivery, and beyond
                                                    • Security concerns (“porch pirates”) create a need for anti-theft measures
                                                        • Figure 6: Attitudes toward shopping online – Concern with theft, by urban area, June 2018
                                                      • Drive online sales with an easy returns process
                                                        • Figure 7: Reasons for shopping more online – Easy returns, by online shopping frequency, April 2018
                                                    • Market Trends – What You Need to Know

                                                      • Amazon Prime sets the pace for delivery expectations
                                                        • Smart technology for secure delivery
                                                          • Combination of online and offline –“New Retail”
                                                            • Growing investment in automated pickup lockers
                                                            • Market Trends – Shipping Speed and Partnerships

                                                              • Amazon Prime resets shopper expectations for delivery speed and cost
                                                                  • Figure 8: Attitudes toward shopping online – Amazon Prime impact on shipping expectations, by online shopping frequency, June 2018
                                                                • Setting great expectations can lead to disappointment
                                                                  • Amazon Prime continues to up the ante on shipping benefits
                                                                    • Free two-day delivery fast becoming the norm
                                                                      • Figure 9: Expectations for free two-day shipping, by online shopping frequency and urban area, April 2018
                                                                    • Retailers match Amazon Prime speed – sans membership fees
                                                                      • Figure 10: Walmart – Abandoned shopping cart email; Ashley Furniture HomeStore – Customer acquisition email, July 2018
                                                                    • The next expectation: same-day delivery
                                                                      • Potential in partnerships and going it alone
                                                                        • Target acquires Shipt in bid to compete with Amazon and Whole Foods partnership
                                                                          • Figure 11: Target and Shipt – Promotional email, May 2018
                                                                        • Bricks-and-mortar retailers using resources wisely, opportunity for smaller players
                                                                          • Figure 12: Attitudes toward online shopping – Expect orders shipped from store locations, by parental status and age of children, June 2018
                                                                      • Market Trends – Delivery to Unmanned Locations

                                                                        • Delivery to secure locations with the help of smart technology
                                                                          • In-home delivery
                                                                            • In-car delivery
                                                                            • Market Trends – Pickup and Returns to Physical Locations

                                                                              • In-store pickup provides comfort, control for shoppers, saves retailers money, drives foot traffic
                                                                                • Discounting online orders picked up in-store
                                                                                  • Curbside pickup
                                                                                    • Figure 13: Nordstrom – Promotional email, July 2018
                                                                                  • Most omnichannel retailers accept returns in-store
                                                                                    • Online-only retailers get creative with partnerships with physical drop points
                                                                                        • Figure 14: Everlane – Returns email, February 2018
                                                                                      • Retailers, shippers, and third parties expand unstaffed pickup lockers
                                                                                        • Figure 15: Walmart – Pickup Tower notification email, April 2018
                                                                                        • Figure 16: UPS Access Point email, February 2018
                                                                                    • The Consumer – What You Need to Know

                                                                                      • Shipping and Delivery
                                                                                        • Convenience – cost, speed, security and ease of returns factor into shipping choice
                                                                                          • Free and fast(er) becoming expected
                                                                                            • Store Pickup and Pickup Lockers
                                                                                              • In-store pickup garners strong interest, but can be improved
                                                                                                • Security concerns, privacy issues, surprise gifting open the field for pickup locker use
                                                                                                  • Post-Purchase and Returns
                                                                                                    • Desire for proactive status updates in preferred format
                                                                                                      • Shoppers evaluate the returns policies at the time of ordering – clarity is needed
                                                                                                        • High expectations for delivery extend to returns
                                                                                                        • Factors Influencing Shipping Choice

                                                                                                          • Cost, convenience, speed are most influential
                                                                                                            • Figure 17: Factors that influence how consumers choose to receive an online order, June 2018
                                                                                                          • Older shoppers more cost-conscious; younger shoppers have a need for speed
                                                                                                            • Figure 18: Top three factors that influence shipping choice for online orders, by generation, June 2018
                                                                                                          • Women aged 35+ are more likely to seek easy returns
                                                                                                            • Figure 19: Factors that influence shipping choice for online orders – Ease of returns, by gender and age, June 2018
                                                                                                        • Overview of Delivery and Pickup Options – Use and Interest

                                                                                                            • In-store pickup options gain ground on traditional home delivery
                                                                                                              • Interest in lesser-used options creates opportunity for retailers to explore alternatives
                                                                                                                • Figure 20: Use and interest in online order delivery methods, June 2018
                                                                                                            • Delivery Methods – Use and Interest

                                                                                                              • Lower use but strong interest in next day delivery
                                                                                                                • Figure 21: Use of and interest in online order delivery methods – Traditional home delivery, by generation, June 2018
                                                                                                              • Speedy delivery particularly important for perishables, gifts/holiday, and medication
                                                                                                                • Access, trust are barriers for smart lock in-home/in-car delivery
                                                                                                                    • Figure 22: Use of and interest in online order delivery methods – Smart home/car delivery, by men aged 18-44 vs all, June 2018
                                                                                                                • Store Pickup – Use and Interest

                                                                                                                  • BOPIS (buy online pickup in store) services evolve, garner strong interest
                                                                                                                      • Figure 23: Use of and interest in online order delivery methods – Store location pickup, June 2018
                                                                                                                    • Opportunity in curbside with the right communication
                                                                                                                      • Figure 24: Mariano’s grocery – Promotional email, July 2018
                                                                                                                    • Frequent online shoppers are the most interested in all pickup methods
                                                                                                                      • Figure 25: Use of and interest in online order delivery methods – Store location pickup, by online shopping frequency, June 2018
                                                                                                                    • Traditional in-store pickup meets the needs of rural shoppers
                                                                                                                      • Figure 26: Use of and interest in online order delivery methods – In-store pickup, by urban area, June 2018
                                                                                                                    • Younger shoppers, parents are less patient, interested in same-day in-store pickup
                                                                                                                      • Figure 27: Use of and interest in online order delivery methods – Same-day in-store pickup, by generation, June 2018
                                                                                                                      • Figure 28: Use of and interest in online order delivery methods – Store location pickup, by parental status, June 2018
                                                                                                                  • Store Pickup Behaviors and Motivations for Use

                                                                                                                    • Discount offers can drive BOPIS, leading to additional purchases
                                                                                                                      • Figure 29: In-store online order pickup behaviors, by parental status and age of children, June 2018
                                                                                                                    • Think beyond cost and speed to promote other advantages
                                                                                                                      • Figure 30: Motivators to pick up an online order in-store, June 2018
                                                                                                                    • In-person evaluation, immediate need motivates in-store pickup
                                                                                                                        • Figure 31: Motivators to pick up an online order in-store, by product category, June 2018
                                                                                                                      • Envisioning a best- and a worst-case online order pickup experience
                                                                                                                        • Best-case online order pickup scenario
                                                                                                                          • Worst-case online order pickup scenario
                                                                                                                          • Third Party Pickup Lockers – Use and Interest and Attitudes

                                                                                                                            • Potential for an automated pickup future
                                                                                                                              • Younger men to drive adoption
                                                                                                                                • Figure 32: Use of and interest in online order delivery methods – Third party locker, by gender and age, June 2018
                                                                                                                              • Less-frequent online shoppers and suburban consumers show interest
                                                                                                                                • Figure 33: Use of and interest in online order delivery methods – Third party locker, by urban area and online shopping frequency, June 2018
                                                                                                                              • Convenience, security, financial motivations drive use of pickup lockers
                                                                                                                                • Figure 34: Reasons for having an online order delivered to a third party pickup locker, by generation, June 2018
                                                                                                                              • Third party pickup lockers can make gift-giving easier, as well as offer privacy
                                                                                                                                • Figure 35: Reasons for having an online order delivered to a third party pickup locker – Gift for household member, by demographics, June 2018
                                                                                                                              • Preference for other delivery options, knowledge, and trust issues deter use
                                                                                                                                • Figure 36: Reasons for not wanting to have an online order delivered to a third party pickup locker, June 2018
                                                                                                                            • Improving the Post-Purchase Experience

                                                                                                                              • Communication is key to improving the post-purchase experience
                                                                                                                                • Figure 37: Improving the post-purchase experience, June 2018
                                                                                                                              • Adding easy returns and a theft guarantee to status updates has the greatest reach
                                                                                                                                • Figure 38: TURF Analysis – Post-purchase experience, June 2018
                                                                                                                              • Consider age of recipient for optimal communication method
                                                                                                                                • Figure 39: Improving the post-purchase experience – Communication methods, by age, June 2018
                                                                                                                              • Post-purchase behaviors and expectations center on tracking proactive updates
                                                                                                                              • Returns – Reasons, Behaviors, and Attitudes

                                                                                                                                • Returning online orders is to be expected
                                                                                                                                  • Figure 40: Reasons for having returned an online order, June 2018
                                                                                                                                • Product issues related to size, quality, and unmet expectations prompt returns
                                                                                                                                    • Figure 41: Reasons for having returned an online order – Product issue, by gender, June 2018
                                                                                                                                  • Invest in quality packaging materials, training at fulfillment centers
                                                                                                                                    • Figure 42: Reasons for having returned an online order – Damage, by online shopping frequency, June 2018
                                                                                                                                  • Buyers’ remorse less problematic, impulsive younger shoppers buy now – decide later
                                                                                                                                    • Figure 43: Reasons for having returned an online order – Changed mind, by age, June 2018
                                                                                                                                  • Delivery timing has less impact on returns
                                                                                                                                    • Figure 44: Reasons for having returned an online order – Timeliness, by age and parental status, June 2018
                                                                                                                                  • Physical locations preferred for online order returns
                                                                                                                                    • Figure 45: Attitudes toward online order returns – Return to a store/physical location, by age, June 2018
                                                                                                                                  • Shoppers have high expectations for returns and are unforgiving
                                                                                                                                    • A bad returns experience could be costly
                                                                                                                                        • Figure 46: Attitudes toward online order returns – Expectations, by online shopping frequency, June 2018
                                                                                                                                      • Returns policies are under scrutiny, but shoppers need clarity
                                                                                                                                        • Figure 47: Attitudes toward online order returns – Returns policies, by gender and age, June 2018
                                                                                                                                    • Appendix – Data Sources and Abbreviations

                                                                                                                                      • Data sources
                                                                                                                                        • Consumer survey data
                                                                                                                                          • Consumer qualitative research
                                                                                                                                            • Direct marketing creative
                                                                                                                                              • Abbreviations and terms
                                                                                                                                                • TURF Analysis – Methodology
                                                                                                                                                  • Figure 48: Table – TURF Analysis – Post-purchase experience, June 2018

                                                                                                                                              Delivery and Returns: Understanding Consumer Needs - US - August 2018

                                                                                                                                              US $4,395.00 (Excl.Tax)