THE OLD SUPPLY CHAIN: THAT SYSTEM IS BROKEN, AND WE’RE NOT FIXING IT

Companies spend a lot of time, money, and effort to acquire each customer. You can’t just let your customer experience drop off when the order hits the distribution center. The old supply chain is broken. Today, logistics providers need to do more than just deliver products.

Tina Sharkey
CEO, Brandless, Section 1
People carry powerful smartphones that come with Wi-Fi and GPS that help them find what they need instantly. They can share information in real time, and that includes their shopping experiences. Opinions and ratings aren’t just word of mouth now—they can spread like wildfire.

That also means companies can find customers, connect with them, and provide services more quickly in ways that just couldn’t happen before. Positive feedback can be amplified, while customer concerns can be quickly addressed, converting potentially unhappy customers into loyal brand followers.

Retailers that are connecting with and catering to their customers are likely leveraging other technologies to create a unique brand experience. From placing an order to receiving it, every step is important.

These companies are fulfilling their customers’ orders, personalizing their experiences, and then delivering goods right to their doors. In the process, they are eliminating several segments of the traditional distribution infrastructure, increasing efficiency, and lowering costs, which creates an added layer of savings that can be passed on to customers.

Developing a direct-to-consumer business requires building a new logistics network.

None of this could have been done on legacy logistics networks. They were built to service the old distribution channel by shipping huge pallets of consumer products from factories to warehouses and then to retail stores. That system is broken, and we’re not fixing it.

Developing a direct-to-consumer business requires building a new logistics network. Logistics providers need to do more than deliver products. Companies spend a lot of time, money, and effort to acquire each customer: engaging that person, getting them through the shopping cart experience, processing their order. After all that, you can’t just let your customer experience drop off when the order hits the distribution center. You want to sustain a great relationship with your customer all the way to them unboxing their order.

Those personal touches that create a great relationship have historically been handled by other links in the supply chain. In an upscale retail store, for example, trained sales clerks thoughtfully wrap customer purchases and attend to specific details that make for happy shoppers and uphold a strong customer experience. Now, those details that the company of origin wants their customers to enjoy aren’t always happening in the store. They are being managed from the loading docks at a distribution center.

Today’s logistics partners are responsible for the final contact with the end customer: they ensure the right products are picked, that the order is packaged according to brand specifications, and that orders get out the door on time.

This shift in responsibility requires package handlers and shippers to re-tool their environment so they can uphold your brand promise and experience. That’s now a part of their job, but
it has to be done efficiently.

From a brand perspective, communicating your expectations and what needs to be included in each box helps your partners create a workspace that supports their operations, your brand, and the overall customer experience.

Communication is key. When your logistics partners receive an order, providing personalized tags that specify color choice and other preferences or a weather forecast at the delivery location to help inform packing decisions, can optimize for efficiency. From a brand perspective, communicating your expectations and what needs to be included in each box helps your partners create a workspace that supports their operations, your brand, and the overall customer experience.

The direct-to-consumer retail shift is still in its early stages. As eCommerce expands, more companies will realize that they must go to where consumers live, not the other way around. This requires us to find new ways to connect with customers and make their shopping experiences smooth and predictable. It also requires a major supply chain upgrade, which plays a critical role in unlocking the unforgettable experiences that we want to bring to every customer.