Interview • 24.05.2016
”Delivery is crucial in the online shopping experience“
Interview with Arjan Kerkhoff, Senior Director Key Account Management Northern & Central Europe at MetaPack
Not only are they young and like to spend money, they are also very tech savvy: the Millennial Generation. Since they grew up with the Internet, they are well informed and already had experiences with online retailers. In this iXtenso interview, Arjan Kerkhoff explains how discerning this generation is when it comes to online shopping and why the delivery process plays an important role for millennials.
Mr. Kerkhoff, why do millennials have such a low tolerance for bad service?
Millennials have grown up in a digital world. Compared to the more analog world that older people are still familiar with, their world seamlessly integrates digital technology and product choices in everyday life. That’s why millennials also expect a fast and seamless customer experience in eCommerce order fulfillment. Since they have been used to this all of their lives, they also have a lower tolerance for mistakes and bad customer service experiences when things don’t go as smoothly as they should.
Why does delivery in particular play such a big role for this generation?
The delivery is the final stage of any buying process and therefore crucial for the overall experience the customer has during this process. In addition, the purchase always satisfies a want or need and the delivery is key on how quickly this need is actually met with an online purchase. Speed is one of the most important factors for millennials.
What special services are important to millennials when it comes to the delivery of products they purchased online?
Millennials tend to be very mobile. Unlike older people, they are not home as often and are frequently not able to receive packages there. That’s why the type of delivery is also very important to them. They like the flexibility of being able to decide whether the package should be delivered to their homes or their workplace or whether they want to collect it at a parcel pick-up service or the actual store in person. Click and collect retail models also play a big role here, since millennials are also willing to pick up items they ordered online in person at the store if they previously already selected and purchased online.
This age group also likes to use the same day delivery option if the retailer offers it. Another difference compared to older customers: millennials are willing to pay for additional services, whereas for older customers, the price is often most important. One example is Amazon Prime, which promises its customers special offers and faster delivery for an additional fee. Millennials are mindful that special treatment by a retailer comes at a price in most cases.
A fast and convenient return process is also very important to millennials. They would like to know at any time how returns are handled by the respective retailer: will the package be picked up at home or the office or do they need to drop it off in person at a service point location? It’s bad enough if something is wrong with the item or if a clothing item does not fit. If returns are then also cumbersome and obscure – or actually involve a fee – it presents a negative experience that affects the overall shopping experience. This is why retailers also need to f ocus on service commitment and the needs of their customers.
What new services do millennials want to see in the future in terms of delivery?
Millennials tend to be very savvy with new technologies and are also willing to try out new services for a fee if they hope to benefit from them. For instance, 30 percent of millennials could envision receiving a shipment via drones. Amazon has already tested this type of system for example.
Millennials generally highly emphasize convenience. When it comes to online ordering, this also means a high level of transparency throughout the entire process. At any time, they want to be able to track via text message, email or at a website where their package is currently located and how long it will take for delivery. This is a service that many retailers are still not offering today but that millennial customers are almost taking for granted.
What consequences should retailers expect if they don’t live up to these expectations?
Generally, you can describe millennials as particularly mature and self-confident customers who are not afraid to air their grievances on social networks for instance if they had a negative retail experience and also don’t have a problem avoiding that particular retailer in the future and never shop there again. As a result, negative experiences by customers spread quickly and retailers get a bad brand image with this target audience. And this is something that’s hard to shake. This is why it is important for retailers to also monitor social networks themselves, so they are quickly able to respond to a negative comment about their company. Millennial customers are more likely to be aware of their strong position as paying customers of retailers than older customers and don’t hesitate to give a negative review or actually shop at a competitor store.