Question; are you on good terms with your warehouse and logistics team? I sure hope so, as this is the team that, above all others, can quite literally make or break your eCommerce operations.
Just in case you are short of time, here is what the data shows:
In short
What you need to do:
- Push cut-off order times to be as late as possible
- Shorten delivery times
Why you need to do it:
- Increased revenue via improvements on key metrics:
- More visitors
- Increased conversion rates
- Potential average order value improvement
- Likely to increase your return on ad spend
Have time to read more? We have taken an in-depth look at the reasoning behind it and the best practices to deploy for your success.
The Good
Why do the likes of Amazon, Next PLC and countless supermarkets offer a late cut-off time for next day orders? It’s simple; it has a huge impact on the conversion rate (the percentage of people who visit a website and then purchases an item).
Here’s a real-world eCommerce site that had a cut-off time of 1pm:
Have you noted how traffic stays relatively stable throughout the day, yet the peak conversion rate comes just before the cut-off time? This is where the customer panic begins to set in, as they want to get the order in quickly to ensure next day delivery. Then, of course, you can see how the conversion rate declines throughout the rest of the day.
The Bad
Early cut-off times means your warehouse and courier(s) will need to do better. What you’ll tend to see is that traffic to your site grows from 9am onwards and will stay stable throughout the day, with the last peak at 9pm – the prime eCommerce sales time. However, if you have a cut-off at 11am, you’re going to find a mad rush to get orders in, with a peak conversion rate just prior to cut-off – leaving the rest of the day for other potential customers to ask the question; what do I do?
Do I…
a) Put an order and wait an extra day or
b) Go to a competitor with a later cut-off time?
Of course, the above question is still asked even if you have a later cut-off time; it’s just that it is being asked later in the day, capitalising on more of the visitors before the cut-off.
Say the aforementioned eCommerce site had to change their cut-off order time to 11am in the morning. The sheer number of orders coming in would mean the warehouse would not be able to keep up, and the rate of problems would increase. An earlier cut-off time would ensure the warehouse staff had more time to check orders were going out correctly. Here’s the impact:
Bringing the cut-off time forward by 2 hours also brought forward the peak conversion rate, which is by no coincidence the closing hour prior to cut-off.
The Ugly
No cut-off time is the worst of the worst. It leaves a big question on people’s minds; “When will I receive this item?” – sure, they may get to the checkout process, but what does “Parcel Force 24hrs delivery service” mean if the cut off for the current day isn’t shown?
Conclusions
So, what did we learn?
- The later the cut-off time, the better.
- Earlier cut-off times means you let more potential customers order with competitors.
- Earlier cut-off times are better than showing no cut-off time, which means you are losing customers to both early and late cut-off time competitors (people need certainty).
- Show your cut-off times on product pages – don’t make the customer work for it and look for times within delivery/shipping pages or at the checkout process.
- Best to show cut-off time with a countdown timer. This gives the customer an exact cut-off time making them aware of how long they have to place an order.