Grove Collaborative reduces delivery times and improves customer satisfaction

0

Much of ecommerce today revolves around the shipping game. How quickly can consumers have the product in their hands and how inexpensively can that happen? But for brands, the questions go beyond when and how much. At natural products retailer Grove Collaborative, the team was dealing not only with customers’ expectations, but also their own need to streamline operations and boost their insight into the impacts shipping has on their bottom line. To reduce costs and increase customer satisfaction, they turned to GrandCanals and its Fulfillment Intelligence Cloud platform.

With only one small warehouse located in California, the shipping times at San Francisco-based Grove Collaborative weren’t keeping pace with the industry. “From California to the East Coast, our time in transit was six to seven days,” says Roni Rae-Staples, head of fulfillment operations. “That’s too long. Amazon changed that for everyone.”

Shoppers, having grown accustomed to the fast delivery options offered by Amazon and other mega-retailers, are less apt today to settle for yesterday’s shipping times. They’re also hesitant to pay extra to get the quick turnaround they can find for free elsewhere. “No one wants to pay for shipping,” Rae-Staples says.

Simply compiling and understanding the data that drove Grove’s shipping program was presenting problems for Rae-Staples and her team. Gathering information across the various shipping carriers was difficult; between trying to pin down details such as the company’s shipment volume and how much they were paying, she says, “It was 20 to 25 percent of my week. That was a huge chunk of time for me to dedicate, especially when you’re a small company.”

Rae-Staples needed a better way to identify inefficiencies, to spot opportunities for improvement and to deploy changes that would help Grove compete in an era where consumers are increasingly sensitive to delivery timing and price.

Shoppers, having grown accustomed to the fast delivery options offered by Amazon and other mega-retailers, are less apt today to settle for yesterday’s shipping times.

Instant gratification

Grove isn’t the only ecommerce brand transforming its approach to fulfillment. Sean Wilcox, vice president of marketing at GrandCanals, says one driver for change is the dominance of the online consumer. With online sales gobbling up space on the sales pie charts and Millennials occupying a larger portion of buying power than ever before, Wilcox says, “They’re demanding a certain level of speed and convenience.”

In addition, what he calls “the Amazon effect” is also pushing retailers to find new ways to meet the needs of their evolving consumer base. “Many people have experience with the time, cost and convenience of delivery that Amazon delivers,” Wilcox says. “They now expect that type of experience.”

Specific to retail, another factor upping the stakes on fulfillment is that consumers haven’t forgotten what it’s like to get something right now. “Traditional e-tailers set up their website based on product, but for retailers it’s about the bricks-and-mortar experience and flow,” says Omar Akilah, vice president of product development at GrandCanals.

“Fulfillment is the differentiator when it comes to e-tailing because it’s about speed and convenience and how quickly you can get that item into customers’ hands.”

The right fulfillment strategy gets close to the instant gratification that many shoppers still crave, even if they’re browsing and completing their purchases in the waiting room of their doctor’s office and not in a retail store.

Fulfillment demystified

With a deployment timeline of less than five days, Grove’s migration to GrandCanals was quick and painless. The retailer granted access through the platform to its shipping accounts to enable the transfer of data, and Rae-Staples says they were then on their way.

“The training portion took a day or two to get our team on board,” she says. “We wanted to show them the different features, so they could see how many address corrections we had that month, where our shipments were going and who we were mostly using.” Rather than spend hours analyzing information manually, Rae-Staples can now pull data from the system with a click of a button.

Fulfillment platform implementations begin with historical data of the brand’s shipments — what’s going out to customers, where those consumers are located and how long items spend in transit.

The right fulfillment strategy gets close to the instant gratification that many shoppers still crave, even if they’re browsing and completing their purchases in the waiting room of their doctor’s office and not in a retail store.

“That’s typically data we get directly through the carriers the companies use for delivery,” Wilcox says. The system can then optimize that data, enabling retailers to gain visibility into the fulfillment process. Wilcox says it gives them answers to their most important questions: “How am I delivering to my customers in key markets? What are some of the areas of my fulfillment strategy that aren’t really matching customer expectations?”

Between the team of data scientists at GrandCanals and the company’s technology, that historical information can then be analyzed and opportunities to improve identified, based on the retailer’s fulfillment strategy and its customer satisfaction goals.

Metrics, meet opportunity

The use of Fulfillment Intelligence Cloud allowed the Grove team to measure critical data points and gather data that would provide actionable insight. Due to the platform’s vastly improved reporting over Rae-Staples’s previous approach, she says they quickly saw trends that translated into clear opportunities.

“We noticed that most of our shipments — over 60 percent — were going to the East Coast,” she says. With a map in hand that identified how many shipments were bound for key states, the team looked for the best way to reduce shipping costs and better service those customers that weren’t near the California warehouse.

“Grove was able to run an in-depth analysis around our customer base,” Rae-Staples says. An analysis was done that covered where the brand’s current customers were located and how their expected future growth would influence shipments going forward. “It helped me identify a location on the East Coast that would help improve my time in transit and serve our customers better,” she says.

Grove subsequently opened a second warehouse, this one in Harrisburg, Pa. “Now our transit time to the East Coast is three to four days,” Rae-Staples says.

Breaking down the benefits and risks of changes to the fulfillment process can be difficult. The challenges Grove was facing are increasingly common in today’s competitive retail environment.

“Their demand was on the East Coast and the result wasn’t just a cost scenario,” Akilah says. Deliveries to East Coast customers were also taking too long, something Grove was getting feedback on. The launch of the new warehouse not only helped Rae-Staples reduce the total cost of operation, it also improved the customer experience.

“As retailers are looking to make these decisions, we help from operations to finance to procurement,” Akilah says. That ensures that brands make more informed decisions — with more accurate and complete data behind them. “They’re thinking about the customer experience, not just cost drivers,” he says.

Fulfillment into the future

The success of Grove’s new fulfillment center on the East Coast has prompted the team to look at more ways to reduce delivery times, continue boosting customer satisfaction and improve operations even further. Rae-Staples is using insight gathered through GrandCanals to determine which next step will help get them where they want to go.

“We’re using them to open our third facility, which will probably be somewhere in the middle of the country,” she says. In addition, Rae-Staples is exploring opportunities to broaden the use of the Fulfillment Intelligence Cloud platform. “We’re hoping to do an overall fulfillment analysis,” she says. With solid results already on the board, the expanded application of the GrandCanals tools will help Grove continue to streamline operations and become more efficient.

Julie Knudson is a freelance business writer who focuses on retail, hospitality and technology.

Share.

Comments are closed.