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6 E-Commerce Shipping Strategies That Level the Playing Field for SMBs

By Katie May E-Commerce Times ECT News Network
Dec 27, 2018 11:31 AM PT
automation tools can help e-commerce smbs cut shipping costs and build customer loyalty

This story was originally published on Sept. 4, 2018, and is brought to you today as part of our Best of ECT News series.

E-commerce continues to become more competitive as large companies like Amazon, Target and Walmart soak up market share and customer attention. Shipping window expectations have become shorter, and many online retailers struggle to keep up, particularly small to medium-sized businesses. How can SMBs compete?

Not only is competing possible, there are many SMBs that have been finding exceptional success through smart and streamlined optimization of their processes, and have been using their unique place in the market to stand out from larger competitors.

Attempting to compete dollar for dollar with large corporations is a losing strategy. Instead, SMBs need to focus on their approach to internal processes, minimizing costs to compete in the market, and building repeat business from customers who already have purchased from them. Following are strategies that can help SMBs win more business and revenue in today's fiercely competitive market.

1. Automate your order processing.

Larger businesses have the luxury of dedicated shipping teams and departments -- a luxury not always afforded to up-and-coming SMBs. Whether your shipping is handled by a "department of one" or members of a small team who manage it when they can, having automation in place can help avoid costly mistakes and maximize time spent on building your business.

Automation may sound out of reach and complex for some SMBs, but it really comes down to creating rules to tell a shipping technology how to process tasks. Depending on the software, setup can be relatively simple with straightforward IF/THEN statements.

For example, let's say you have set up your shopping cart to allow customers to choose the carrier service for their orders. Using a combination of shipping automation, a shipping category, and saved carrier selections, you can set up a rule to automatically apply the correct label options as soon as the order pulls in.

Filter your orders by the category you created and batch print labels for all orders using that carrier type. Adding this automation rule, and others like it, literally can cut hours per day spent processing shipments one by one.

In some cases, automation can even be set up to purchase and print labels without a human touching the shipping software. Couple this with automation to print a packing slip at the same time as the label, and the shipment just needs to be packed up and sent out the door.

Automating the label purchase and printing process is just one way automation helps online sellers streamline. When SMBs take a multichannel approach to selling, automatic order import into one central platform -- a feature offered by several shipping software technologies -- can help import orders from those channels to manage them all at once.

Without having to retrieve orders manually from each selling platform, SMBs can save precious time, not to mention avoid mistakes and missed orders.

2. Minimize costs so you can offer free, fast shipping.

Many SMBs fall into the rut of shipping one way and one way only, because they don't have the time to research and compare. What they seemingly save in time could be incurring heavy costs to the bottom line.

The most important element of minimizing shipping costs is ensuring that you have the best rates. That means gaining access to Commercial Plus Pricing from USPS. (As you scale and grow, you be able to negotiate rates with FedEx and/or UPS.) CPP rates from USPS can be obtained through most shipping software providers, historically reserved for only the highest-volume shippers.

Once you have access to these rates, you can optimize your shipping methods based on delivery window, distance, weight and more. You can take advantage of additional features you may need, such as signatures, delivery confirmation or insurance. This is where shipping software becomes particularly useful.

Rather than browsing from carrier page to carrier page, you can select your carrier and shipment method in one screen, drastically cutting down time. It's even possible to set up saved carrier selections, which act like quick reference options to access often-used shipping methods.

Your rates aren't the only way to optimize your shipping costs. Many online sellers don't realize that there are cost savings in using recommended packaging from USPS, FedEx and UPS. Additionally, you can have that packaging delivered right to your door, absolutely free. Here are links to each carriers' page detailing which supplies are free:

When you're comparing carriers and rates, you minimize the effect on your bottom line of offering free shipping to your customers.

Perhaps you simply cannot afford to offer free shipping outright, even with great shipping rates. That doesn't mean it's completely inaccessible to you. Threshold-based free shipping, which encourages customers to reach a certain item or spending threshold to "earn" free shipping, is a smart way to make free shipping less of a cost burden.

By increasing your average order size/value, your business can offset the added cost of covering free shipping. As long as the threshold isn't unattainable or unfairly high, customers often are willing to add another item or two to get free shipping, particularly from an SMB they want to support.

Even with all of the above optimizations and approaches, shipping may still end up being, at best, a breakeven element of your business. With large marketplaces like Amazon and Walmart continually pushing the expectations customers have, shipping may not end up being a money-making endeavor for SMBs, but you can still stay competitive and in consideration with online shoppers.

3. Connect order and shipping data to CRM.

A competitive advantage that SMBs can have over larger businesses in e-commerce is the trusting relationship they can create with customers. SMBs are often less likely to be seen as the faceless company. This opens up the ability to create more brand affinity, which can lead to repeat business and lifelong customers.

Eighty-one percent of consumers want brands that understand them better, according to MarTech Today. Many brands and marketers simply aren't successfully making the effort to connect -- even with the data available to create personalized experiences.

This is where smart SMB owners can capitalize through a combination of online buyer data, data collection to further personalize down the funnel, and personalized marketing to build business.

4. Use customer data to personalize ordering.

You already know the name and location of your customers or the recipients of their orders. Your confirmation emails and packing slips should reflect this. Consider including a personalized note, thanking them for their purchase.

Is your store set up to allow people to mark something as a gift? If so, the packing slip shouldn't note how much the item costs.

Is a customer a first-time buyer? Welcome them with a unique welcome message in the confirmation email or packing slip, possibly sending them to your social pages to gain access to special deals.

If there's a repeat purchase or a top customer, recognize that and make a customer feel special. Small details like this help you form a better relationship with your customers through a more personalized experience -- often easily done through automation.

5. Use purchase data to move customers further down the funnel.

SMBs now have automation tools available to them at price points that businesses of this size actually can afford. These tools allow SMBs to begin building out customer profiles and trigger email marketing campaigns based on purchase behavior, items purchased, personalized information like birthdays and anniversaries, and more. Some of this information is readily available to you, and some you will need to actively collect.

For example, you know when a customer's first order is. This is something you can easily point out, celebrate, and use to encourage another purchase or to further develop the relationship with your customers.

Same goes for the last time a customer marked a purchase as a gift. Triggering a reminder email a year later is an opportunity to invite another purchase. These personalized moments move your customer further down the funnel from occasional buyer, to repeat buyer, to lifelong raving fan.

When you tie shipping and order data to your marketing, you create a powerful brand experience that can end up helping your bottom line. Personally identifying information like geographic location can allow you to create more localized marketing experiences to show your customers you know more than just who they are -- you know where they are. It also can allow you to create shipping promotions to customers it may be cheaper to ship to.

6. Convert shipping data into marketing data.

This goes beyond sending "Hello, [name]" emails. That level of personalization has become relative table stakes. Putting order and shipping data to work for you in conjunction with marketing automation, you can really drive brand experiences with your customers.

Customers want brands to understand them better. Product recommendations based on previous purchases show your customers that you know what they've bought from you, and that you're able to anticipate their next need, offer that perfectly complementary item, or know when their purchase is about to run out and require a refill. All of this can be automated.

For example, let's say you sell beauty supplies or makeup. You likely have a general idea when a customer might be nearing time for a repurchase. Using email automation and order data, you can set up a campaign using parameters such as this:

If purchased item equals X, send X days after an order is shipped (or delivered, if that is supported).
Then, when the product is almost gone, your customer will receive an email promotion reminder to refill from your store, perhaps heading off any inclination to look elsewhere. This creates a loyal, repeat buyer because it shows you're paying attention and fulfilling a customer's particular needs. Successfully growing businesses are built on repeat business relationships.

All these tactics are accessible to the vast majority of SMBs. After a little research and investment up front, the combination of data, automation and optimization can set up any SMB for success.

Katie May is CEO of ShippingEasy, a one-solution hub that provides e-commerce retailers with cloud-based shipping, inventory management, customer marketing, order management and fulfillment solutions, enabling order consolidation across multiple channels and multiple carriers, including USPS, FedEx and UPS.

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