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Why delivery performance belongs on the commercial agenda
Delivery costs and delays can stop customers completing a purchase. Discover why delivery performance is now a commercial priority for retailers.
Delivery costs and delays can stop customers completing a purchase. Discover why delivery performance is now a commercial priority for retailers.
Retailers spend significant time and budget improving the path to purchase. They optimise product discovery, refine ecommerce journeys, invest in personalisation and work to remove friction from checkout.
But the decision to buy can still come down to something much more fundamental: how much will delivery cost, and when will the order arrive?
Our research for The Omnichannel Illusion found that unexpected delivery charges and delivery taking too long collectively ranked as the number one reason respondents abandon checkout.
That makes delivery more than a fulfilment concern.
When delivery influences whether a customer completes a transaction, it becomes a commercial performance issue.
The traditional customer journey can make delivery look like the final operational step: marketing creates demand, ecommerce converts it and fulfilment takes over once the customer has placed an order.
Customers don't experience the journey in those departmental terms.
They are evaluating the entire proposition before they buy.
Can I get the product I want? Is it available? What will it really cost me? When will it arrive? Can I trust that promise?
Our research found that customers want certainty around product availability, price and the affordability of delivery. These aren't simply service details; they are factors in the decision to purchase.
This changes the role delivery should play in commercial decision-making.
If an unexpected charge appears late in checkout, the retailer hasn't simply created a fulfilment issue. It has changed the value proposition at the moment the customer is deciding whether to buy.
If the available delivery date is later than expected, the same thing happens. The product hasn't changed, but the attractiveness of the purchase has.
The retailer has invested in acquiring and converting that customer only to introduce uncertainty at one of the final moments of the journey.
One of the more revealing findings in our research is what customers value about different retail channels.
When shopping online, 47% cited the ability to shop at any time as a reason for choosing the channel, while 42% valued delivery to their home or another address.
In-store shopping offers a different kind of convenience. Customers can see and touch products, and 44% value being able to take their purchase home immediately.
That tells us something important about omnichannel retail.
Online and physical channels aren't simply competing for the same transaction. Customers are choosing whichever route makes accomplishing what they want to do easiest.
Sometimes convenience means ordering from the sofa.
Sometimes it means walking out of a store with the product immediately.
The commercial question therefore isn't simply "How do we improve ecommerce delivery?"
It's: How do we give customers the most convenient way to complete this purchase using the capabilities available across our business?
That could mean home delivery. It could mean click and collect, ship-from-store, reserve in store or directing a customer towards nearby stock.
Delivery performance therefore sits within a much bigger question about how effectively the retailer's channels work together.
When a customer abandons checkout because of delivery, it's easy to see the checkout itself as the problem. Sometimes it is, but the underlying cause can sit much deeper in the organisation.
Delivery promises depend on multiple systems and teams working together: ecommerce platforms, inventory data, order management, warehouse operations, carrier integrations, store stock and customer communications.
A retailer might therefore have a perfectly usable checkout and still create friction because the information feeding that experience isn't good enough.
Can the business confidently identify where stock is?
Can orders be fulfilled from different locations?
Can customers see realistic delivery options early enough in the journey?
Can the business make a delivery promise it knows it can keep?
Can customer service see the same order information as the customer?
These are operational and technology questions, but their impact is commercial.
The more fragmented the underlying journey becomes, the harder it is to offer customers certainty.
That's particularly important because connected retail depends on connected information. Bringing customer, stock, order, service and loyalty data together gives teams a clearer view of interactions and makes consistent cross-channel experiences easier to deliver.
If delivery cost contributes to abandonment, the obvious response might be to reduce it.
But simply making delivery cheaper can create another problem: protecting conversion by sacrificing margin.
The better question is whether customers understand the delivery proposition early enough to make an informed decision.
There is an important difference between delivery having a cost and a customer discovering an unexpected delivery cost at the end of checkout.
The latter creates uncertainty.
A strong delivery proposition should therefore consider transparency alongside price.
Customers should understand what their realistic fulfilment options are, what they cost and when they can expect to receive their purchase before they have invested heavily in completing the transaction.
Retailers can then use their wider channel network to offer meaningful alternatives.
A customer unwilling to pay for home delivery might happily collect from a nearby store. Someone who needs an item immediately may prefer to visit a location where stock can be confirmed. Another customer may accept slower fulfilment in exchange for a lower cost.
The goal isn't necessarily to make every delivery faster or free.
It's to give customers certainty, choice and a clear value exchange.
If delivery affects conversion, customer experience, margin and repeat purchase, responsibility for it cannot sit entirely within logistics.
Different teams see different pieces of the problem.
Ecommerce teams see conversion and abandonment.
Operations teams see fulfilment capacity and cost.
Technology teams see integrations and platform constraints.
Stores see collection, returns and local inventory.
Customer service sees the consequences when expectations aren't met.
Commercial leaders see the impact across revenue, margin and customer value.
The opportunity is to connect those perspectives.
Instead of measuring delivery purely through operational metrics, retailers should understand how fulfilment performance affects commercial outcomes.
For example:
Those questions turn delivery from a downstream operational KPI into part of the retailer's overall commercial proposition.
Retailers have spent years connecting stores, ecommerce platforms, customer data and operational systems.
Customers don't value those integrations because they exist. They value what those connections allow them to do.
Our wider research found that only 11% of shoppers believe online and in-store shopping operate as one connected experience, while 36% still view them as separate.
Delivery is one of the moments where that investment should become tangible.
A genuinely connected retailer should be better equipped to answer a simple customer question:
What's the easiest way for me to get this product?
The answer shouldn't necessarily depend on whether the journey started online or in a store.
It should depend on stock, location, customer preference, urgency, cost and the fulfilment capabilities available across the business.
That's where omnichannel stops being an architecture conversation and starts becoming commercially useful.
Our research shows that customers are making pragmatic choices.
They move towards whichever channel makes shopping feel simpler, faster and easier.
That means retailers should be cautious about treating delivery as something that happens after conversion.
Delivery is part of conversion.
Its cost can change the customer's perception of value. Its speed can determine whether the product meets their need. Its reliability can influence trust. And the flexibility of the fulfilment proposition can determine whether investment in connected retail actually produces something customers value.
For senior retail leaders, the question isn't simply whether the operation can fulfil an order efficiently.
It's whether the organisation has built a fulfilment proposition that helps customers say yes to the purchase in the first place.
The Omnichannel Illusion explores what 2,000 UK consumers told us about the gap between retailers' investment in connected experiences and what customers actually experience.
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