21st Dec 2016
New stats released today reveal UK retailers could be missing out on over £3billion* due to delivery failures over the Christmas period.
The survey, undertaken by The Institute of Customer Service, discovered that 16 million UK customers experienced delays with their deliveries over last year’s festive season, 73% of whom are avoiding the offending retailers as a result this year. With consumers saying they spent an average of over £250 with retailers who failed to deliver on time, the risk is a drop in market share as consumers shop elsewhere.
Jo Causon, Chief Executive of The Institute of Customer Service says: “UK retail businesses need to take these findings seriously, as failings arising from their own processes, or chosen logistics suppliers, could have serious implications for their own bottom line. Our research shows online shoppers are prepared to vote with their wallets, and take their custom elsewhere if deliveries – a crucial part of the retail customer service experience – are not up to scratch.
“There is a real emotional cost to consumers when deliveries go awry – particularly around the Christmas period when customers are anxious to receive Christmas presents and festive purchases on time. This emotional cost can soon become a real cost to retailers when customers lose trust and take their business elsewhere.”
The average delay facing frustrated shoppers was 5.3 days, with notable regional differences. Online shoppers in Wales suffered the longest, waiting for their goods for an average of 6.5 days, whilst average delays only lasted 3.6 days for shoppers in the Republic of Ireland. Individual cities also had differing experiences, with those from Norwich waiting for 7.4 days, whilst Southampton shoppers waited for 2.9 days in comparison. London was just over average, with delays of 5.8 days.
The Institute’s research shows that retailers delivering late face reputational damage as well as financial. Nearly three fifths (57%) actively discouraged family and friends from using retailers, and more than half (52%) posted negatively about the retailer on social media.
Causon continues: “When it comes to online, shoppers have so much choice – they are no longer limited to what is on their high street. This means the consumer is increasingly powerful and able to desert companies when service isn’t measuring up – and companies may only get one chance to show they can deliver.
“Best practice when it comes to online retail, therefore, needs to focus on getting it right first time. This year’s UK Customer Satisfaction Index (UKCSI) data shows a clear correlation between organisations who achieve this and their overall UKCSI score. On average the UKCSI score is 82.7 for those organisations where customer service was right first time, but when this did not happen, the score drops to an average of 59. Indeed, our UKCSI also finds that most complaints result in overall customer satisfaction that is lower than the UK average. Key priorities for businesses, therefore, are to prevent problems occurring, conduct root cause analysis on types of complaint to avoid reoccurrence, and ensure the full customer journey is seamless, from landing page to aftercare.”
Notes to editors
For further information please contact:
Helen Glover or Mike Petrook (Institute press office)
E: [email protected] or [email protected]
T: 020 7260 2698 (Helen) or 020 7260 2631 (Mike)
About The Institute of Customer Service
The Institute of Customer Service is the professional body for customer service delivering tangible benefit to organisations and individuals so that our customers can improve their customers’ experience and their own business performance. The Institute is a membership body with a community of over 500 organisational members – from the private, public and third sectors – and over 4,000 individual memberships. For more information about the Institute of Customer Service go to www.instituteofcustomerservice.com.
* Figure arrived at through:
• % of people/shoppers who experienced late delivery – applying this % to total adults in the UK from ONS stats: 16,715,645.96 UK adults experience late deliveries
• of those, % who wouldn’t shop again with that retailer – applying this % to the number we created above: 12,142,964 UK adults put off shopping with that retailer
• the average amount spent on each item that was delivered late multiplied by our figure above: £3,462,036,545 potentially lost in revenue through late deliveries