If you read our post on the Key Factors To Consider When Choosing a Logistics Service Provider, you’ll want to read our article with everything about delivery exceptions.
But first, we need to answer a question that everyone in e-commerce ends up looking up: what is a delivery exception?
What’s a delivery exception?
A delivery exception, also known as a shipment exception, is the term used when a package has been delayed whilst in transit.
There are various reasons why a package might become delayed. The reasons range from issues with the address to carrier problems. From time to time everyone receives the message: “shipment exception unable to deliver”.
While a shipment exception is annoying, it doesn’t mean that the package will definitely miss the delivery deadline and doesn’t even mean that the delivery will be severely delayed.
In fact, it’s not necessarily something to worry about.
If you’ve been asking yourself what’s a delivery exception, then wonder no more. But if you’re confused about why shipment exceptions happen and why they are increasing, then read on.
The reasons for a shipment exception
Now that we’ve covered the question of what a “shipment exception” means, we can move on to why they occur.
Occasional issues are almost inevitable, no matter which carrier a retailer is working with. If this is only the first time you’re asking what a delivery exception means, then you might be interested to know that up to 11% of all shipments are affected by a type of delivery exception.
The pandemic meant that more people turned to online shopping. This increased online sales but also increased the occurrence of shipment exceptions. This generally means that more packages are missing their delivery times.
At the end of each missed or late delivery, there is a frustrated customer who might contact the shop, or the shipping handler, or make their irritation known on social media. An angry post on social media is not good publicity for the retailer.
What a delivery exception means for retailers
What is a shipment exception going to do to a retailer’s business?
Well, their profit margin can be affected and several important metrics may be impacted. It will be especially bad news if a customer returns their item and demands a refund.
The retailer will not only lose the sale, but they will also lose the shipping fee and the customer will be unlikely to return.
If you seek the delivery exception meaning it can mean a lot more “Where Is My Order? (WISMO)” calls from customers who haven’t been informed of a problem with their delivery.
Generally, these calls make up approximately half of all incoming calls to customer care advisors and each costs around $5.
This is why more retailers are investing in adding tracking information to packages and supplying customers with delivery updates.
According to an Ipsos study, at least 85% of respondents stated that delivery time was an important factor when shopping online.
When figuring out their personal shipment exception meaning retailers need to consider their churn rate which will increase if their deliveries result in a dissatisfying post-purchase experience.
Retailers need to remember that customers are less likely to recommend a store after a delivery exception, severely impacting their Net Promoter Score (NPS). If a retailer can solve their carrier issues, they can potentially add another 3 points to their NPS.
8 reasons why an exception delivery might happen
Here are some of the biggest causes behind delivery exceptions.
- Wrong address – if the package is labelled with a wrong or incomplete address, or if the address is unclear, the package is likely to arrive late or be undeliverable.
- Weather events – bad or unexpected weather conditions, including acts of God, can result in problems for carriers and delivery delays.
- Lost packages – if a carrier loses a package there will be a delay in delivery while the package is located. If it cannot be found, the delay will go on until the situation is resolved.
- Damaged in transit – shipping labels can become damaged in transit and shipping details can become illegible. If the package is too damaged, a replacement may be necessary.
- National holidays – customers are generally more understanding about delays that occur due to federal holidays.
- Missed delivery – this is when the customer needs to sign for their package, but they are unavailable when it is delivered.
- Customs – a delay can occur if there is an issue at Customs where an extra fee might need to be paid or additional documentation might be required. International retailers should learn all they can to preempt any issues at Customs.
- Other unforeseen circumstances – life is unpredictable and even with the best intentions things can go wrong causing a shipment exception, such as a traffic accident that holds up the delivery driver.
The causes of delivery exceptions and their durations can vary. The retailer should take steps to lessen the impact on the customer and make the experience as positive as possible by meeting customer expectations.
Customer expectations in the event of a shipment exception
Major retailers like Amazon have set the bar very high for a satisfying delivery experience. In the event of a shipment exception, almost all customers expect the retailer to offer them the option to remedy the situation with some type of self-service.
The overwhelming majority of customers expect the retailer to at least let them know of the delivery exception and keep them informed.
Once the exception has happened, almost all customers want the retailer to be clear about when they will receive their package. Almost half of customers affected by a delivery exception will shop elsewhere in the future if they feel the retailer is not being helpful.
Updating customers with tracking information and keeping them informed reassures them and can help turn a potentially negative experience into a positive one.
Just over half of customers want retailers to offer an appeasement of some sort, such as a discount code for their next order. This will also help to retain the customer.
How to own a delivery exception
Delivery exceptions are a fact of e-commerce. A retailer’s reaction is what sets it apart from the competition.
As mentioned, a delivery exception can be a chance to secure a positive outcome from a negative experience. If a customer sees how well a retailer handles a delivery exception, they may be more likely to buy from them again in the future.
If a retailer becomes aware of a delivery exception, they shouldn’t wait for the customer to contact them. They should be proactive.
Let them know the situation and keep them informed. Retailers should be transparent with their customers, demonstrate a flexible attitude and only promise what they can deliver. These are the fundamentals of Deliver Experience Management (DEM).
Reducing delivery exceptions
There are four major steps you can take to cut back on delivery exceptions and they all involve being proactive and keeping the customer informed.
- Tracking pages – these keep customers informed with a user-friendly page that offers delivery details.
- Shipping notifications – keeping customers in the loop with notifications will reduce the number of WISMO calls you receive.
- AI-generated shipping metrics – these allow retailers to preemptively spot where and how delivery exceptions might happen, giving retailers the opportunity to get ahead of the problem and make the best of a potentially bad situation.
Integrated sales channels – with sales information set up to flow directly into your logistics partner’s warehouse system, there won’t be as much room for error. See our e-commerce solution as an example.