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Logistics software provider says Aussie retailers need better logistics to fight Amazon

Logistics software company Temando’s “Annual State of Shipping in Commerce Report” says improved online shipping experiences and retailer capabilities can help Aussie retailers fight Amazon.

With Amazon’s impending arrival in the Australian marketplace, companies are coming out of the woodwork to either help you defeat Amazon at its own game, or show you how to work with Amazon so you can leverage its power for your own benefit.

We've seen The Zoo Republic offer a way to win by fighting Amazon, we've seen Alley's Goliath show you how to win by working with Amazon, and we've seen top Aussie retailer Klika claim its clout and profits will climb with its planned Amazon partnership.

Now comes a global logistics software platform provider Temando, offering yet another way to cope with Amazon, proffering ways to fix the vulnerabilities it sees in “shipping and fulfillment that retailers must fix to success” given Amazon on Aussie shores “promises to revolutionise the online market on a never-before-seen scale.”

Of course, the revolution has not only been foreseen (or we wouldn’t be talking about it), but it has already been seen on US shores and other parts of the world, and because of its impact in those places, everyone is projecting those results here – onto the local marketplace.

Temando has sought to add value to the conversation (and to its bottom line) by releasing the latest edition of its “annual State of Shipping in Commerce survey”, which has canvassed “258 retailers and 1279 online shoppers in Australia".

The results highlight that “while 65% of consumers stated that they abandoned their cart due to the high cost of shipping, 61% of retailers struggle to manage the increasing cost of carrier rates".

This obviously gives Carl Hartmann, the co-founder and chief executive of Temando, an opportunity to segue in with a comment.

Hartmann said that “as the competition is heating up between local retailers and the coming of Amazon, there’s a golden opportunity to drive innovation faster on our shores.”

He noted that: “Smart retailers have their foot on the gas and are using the arrival as a huge opportunity to streamline their processes, optimise logistics and embrace digital transformation to put them in a prime position to not only survive, but thrive.”

It’s at this point that another stat from the survey is to be inserted, which is why we learn that, “Consumer demand for seamless shipping to complete their online shopping experience is growing as up to 57% of shoppers will buy from competing stores when retailers fail to provide relevant shipping options to suit their needs.”

Chipping in with the appropriate buzzwords, but with an über twist is Hartmann’s comment that: “Shipping is sometimes overlooked in favour of marketing and packaging, but as we enter a post-Uber age, it isn’t just a “back end” issue anymore, but a front-and-centre priority to enrich customer experience and fuel growth.”

Presumably, Hartmann hopes that teleportation doesn’t arrive anytime soon, lest we start talking about a post-Temando era, too.

Next up from the survey results is the statement that 'Shoppers aren’t looking back from best-in-class shipping experiences'.

The stats to support this are:

  • In-demand shipping options that cater to convenience such as “specified time slot” (50%), “same- day” (41%), “weekend or afterhours” (44%) and “hyperlocal” (37%), is offered by less than a quarter of retailers currently.
  • A negative shipping experience is enough to put off 59% of customers from shopping with that retailer again, while 80% of shoppers will repeat purchase if they enjoyed the shipping experience.
  • About 68% of shoppers said they’ll shop more online for free shipping, with up to 65% willing to increase their basket size to qualify for a free shipping offer. Yet only 26% to 39% of retailers use "free shipping with a minimum spend" as a conversion tactic.

Hartmann then added: “We’ve found Australian shoppers react more strongly to shipping experiences compared to American shoppers. New alternatives to standard and express delivery has been largely unmet this year compared to 2016 which opens up enormous opportunity for retailers to re-imagine their retail operations and create meaningful, cost- effective customer experiences."

So, what of the failure to innovate processes having reduced the ability to perform?

Here we learn that:

  • 51% of retailers acknowledge that technology platform compatibility is an issue, with 58% finding integrating carrier services into their systems a key challenge.
  • 47% of retailers acknowledge challenges with shipping and fulfillment automation, while 37% felt the same about shipping from store. Yet only 29% and 24% respectively are planning to invest on improving these issues in the next 12 months.
  • 72% of retailers grapple with the accuracy of international shipping costs, with only 21% having the ability to charge all applicable duties and taxes for international customers in the cart.

To support this section, Hartmann adds: “Using smart technology to streamline processes will help to remove some of the key fulfillment challenges retailers are facing now and in the future. How businesses evolve with this changing landscape will influence how far their business grows, and how fast they scale.

Then there’s the fact that 'rising consumer expectations' are linked to 'tech adoption'.

Here we find:

  • The popularity of new food delivery services influenced 59% of high spenders who expect to have hyperlocal shipping as an option when shopping online.
  • 23% of shoppers are using their mobile devices as their primary shopping tool, with Millennials being the highest adopters at 48%, while Gen Z sits at 29%.
  • Access to a wide choice physical and online stores has given rise to two behaviours: webrooming (look online, buy in physical store) and showrooming (look in physical store, buy online) which is engaged by 65% and 51% of shoppers respectively.

Hartmann heartily concludes by noting (and plugging Temando): “The race for customers is not going to subside and with the imminent arrival of Amazon, Australian businesses should be embracing the challenge. Temando is investing in scalable shipping and fulfillment solutions to address one of the core causes of cart abandonment and agile retailers are seizing the chance to optimise their operations using such technology.”

“With future growth opportunities existing in the ability to cross borders, its vital that delivery networks and retail operations work seamlessly together to satisfy the customer while managing the bottom line.”

More on Temando

Temando means “I send you” in Spanish, and reminds us that it is “a global technology company that exists to connect the world’s logistical resources into a single intelligent software platform and to make commerce universally accessible to everybody".

The company says its solutions “give merchants the power to move goods from anywhere they are to wherever they need to be, no matter how they need to get there".

Temando is a “Neopost Company headquartered in Australia, with offices in Brisbane, Sydney, San Francisco, London, Paris and Manila.”

Here’s the company’s corporate video:

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Alex Zaharov-Reutt

One of Australia’s best-known technology journalists and consumer tech experts, Alex has appeared in his capacity as technology expert on all of Australia’s free-to-air and pay TV networks on all the major news and current affairs programs, on commercial and public radio, and technology, lifestyle and reality TV shows. Visit Alex at Twitter here.

 

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