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Digital River - Talk to the Experts

Customer Service in the Shipping Industry: Lost in Transit?

By Jim Offner
Nov 21, 2008 4:00 AM PT

The joke used to be on the U.S. Postal Service. Indeed, jabs about the government's mail system may have driven business to private-sector competitors like United Parcel Service, Federal Express and DHL.

Customer Service in the Shipping Industry: Lost in Transit?

That was decades ago; now, it seems, some of the same companies designed to outperform the USPS have attracted complaints about sluggish deliveries and failure to deliver. Tracking numbers have become as necessary as delivery vans.

Despite the companies' successes, there have been some rough times of late.

DHL Backs Off

Earlier this month, Germany-based delivery firm DHL said it was bailing out of the U.S. domestic market. By the end of January, the fourth-largest parcel shipper in the U.S. will drop its domestic-only services; however, the company will continue to offer international shipments to and from the U.S.

How that move will affect the service provided by DHL's U.S. competitors is hard to say.

"With DHL pulling out of the market, I would think the remaining shippers would be focused like lasers on customer satisfaction and, for the most part, they are," Rob Enderle, principal analyst with the Enderle Group, told CRM Buyer.

"But ... the individual shipper can get lost in the noise," he acknowledged. "It is generally a wise practice to insure your package for the amount it is actually worth, because thefts and in-transit damage do happen."

All of the major shippers make various claims to be quick and efficient, regardless of what they're handling. Sometimes, though, there are wild deviations from their on-time track records -- even for deliveries to the same customer.

"If you miss a delivery -- and we missed one yesterday -- you can call, locate the driver, and if you've developed a relationship with them meet them at one of the later scheduled stops to pick up your package," said Enderle. "We did that yesterday. You can also go to their depot after they return and get the package there."

There are numerous Web sites, such as the Consumerist and Consumeraffairs.com, that serve as forums for customer complaints -- ranging from packages left at doorsteps without warning to late or nondeliveries.

One way to improve your chances of getting parcels on time is to make your business relationship personal.

"I've found that the best defense is to get to know your route drivers; some actually have purchased their routes, and you are their customer -- and they'll make sure you are taken care of as much as they can," Enderle said. "I've had mine advise me to pack things better, fix my labels before they ship the product, and tape the boxes better when I ran out of my own tape."

Tracking Tools

Companies' tracking tools can make a big difference, noted Charles King, principal analyst for Pund-IT. However, all tracking systems are not created equal.

"I noticed that a few smaller retail sites make it pretty hard to track packages or interact with customer service," King told CRM Buyer.

Registering a complaint sometimes entails its own challenges.

"I find that more and more companies prefer to manage customer inquiries via e-mail," King said. "Just finding a contact phone number can be a challenge."

Not that he blames any company for trying to cut costs, as e-mail correspondence does. "E-mail makes sense from a financial standpoint but can be damaging to a company's reputation if those messages aren't handled quickly and seamlessly," he said.

Interacting with larger companies such as Amazon and eBay is a more transparent experience.

"They provide easy-to-access tracking information and respond quickly when things go awry," said King. "I've also noticed that the same practices extend to those sites' retail partners, which is another value-add for smaller companies piggybacking on larger players."

Regardless of what happens online, the customer and the transaction are ultimately at the mercy of the shippers.

"Some are great -- UPS and FedEx both maintain very high service levels," remarked King. "I've also had some great experiences with the local shippers online merchants use to transport heavy objects. Then again, I've also run into a few pikers -- and dealing with multiple layers of customer service and complaint processes can be incredibly difficult and annoying."

No Comprehensive Solution

Feedback sites are not a panacea.

"I'm a bit leery of online complaint or ratings services, since some seem fairly easy to manipulate," said King. "Like anything on the Internet, consumer opinions need to be taken with a grain of salt."

A number of large companies have been using Twitter as a way to gauge customer satisfaction. Among some of the larger corporate entities that have created Twitter profiles are Dell, Starbucks, Jet Blue and ComCast. It's questionable how effective that tactic is, though.

"I haven't used any sites leveraging Twitter," King said. "Frankly, I don't see huge value in that granular a view, since tracking shipments is so static a process -- sporadic updates with lots of quiet time in between. It could be valuable for medications or emergency supplies, but it seems to me that e-mail or instant messaging alerts provide the same sort of service."

All told, the big players in the shipping industry manage to run efficient operations, said Jack Gold, president of J. Gold Associates.

"Delivery companies pride themselves on customer service -- that is what their reputation and ability to charge premium prices is all about," he told CRM Buyer. "Having said that, they also generally provide insurance on shipments, should they get lost. But I am not sure any can really allow consumers to 'intercept' shipments once inside their system. They run massive logistical operations both in terms of tracking every 'touch' on a package, and also in the sense of just directing the traffic of all those packages making their way through their planes, warehouses, trucks, etc."

Tracking is a relatively easy thing to do, since shippers already electronically track everything at each step of the way and are just making that information available to the customer, he noted. "But when problems occur, it is up to the individual companies to provide customer service to often-unhappy customers."

How they deal with those problems is "not a technical issue; it is a company philosophy issue," said Gold. "How well they do at [providing] customer service is an important consideration of how loyal their customers will ultimately be."

The best way to deal with problems is a person-to-person phone call, he said. "Twittering, IM-ing, etc., does not, in my mind, represent the most effective way to interact. Good old person-to person telephone conversations -- or Skype, if you prefer -- would be much better for most people."


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