When faster deliveries backfire

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📝 Intro

We know that - generally - fast ecommerce deliveries lead to positive results (although people are less willing to pay for quick delivery than you would expect).

But what happens if the order arrives even faster than the customer expects it?

They’d be delighted - right?

Wrong. New research finds that being over-efficient in your delivery times can backfire. 

Here’s why, and what you should do about it.

P.S.: Try offering customers a paid subscription to access free shipping of your products (similar to what Amazon Prime does). People will become more likely to buy from you, boosting your profits.

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Faster-than-expected order deliveries increase product returns

Topics: Ecommerce
For: B2C
Research date: August 2024
Universities: Julius-Maximilian University of Würzburg, Goethe University Frankfurt

📈 Recommendation

Don’t deliver ecommerce orders earlier than customers expect them (e.g. in 3 days rather than the expected 5 to 7 working days). 

They will be more likely to return the product.

To help avoid this negative effect, you can:

• Give a more accurate range of expected delivery dates, including the earliest possible delivery dates

• Offer slower delivery options that are cheaper or more eco-friendly, which customers can choose if they like

• Remind customers why they bought the product (e.g. send an email reminding them of the benefits)

🎓 Findings

• People are more likely to return a product when the delivery comes earlier than expected (e.g. estimated delivery time is 5 days, the parcel arrives in 2).

• Researchers analyzed over 1.8 million US orders from a fashion retailer and found that:

  • When a parcel arrives early, for each day before the expected delivery date, the probability of a return increase by 3.8% (e.g. 2 days early - returns increase 7.6%)

  • The effect is stronger for new customers - each early day increases the chances of returns by 4.26%

  • Higher-priced items are more likely and popular items are less likely to be returned

🧠 Why it works

• Even after we make a purchase, we might still have doubts about the decision and whether we have chosen the best option.

• When the product arrives soon after the purchase, these doubts are still very fresh.

• So we question whether we did the right thing (a form of cognitive dissonance), and are more likely to decide it was the wrong choice.

• If the delivery takes longer, as time passes, we think about our purchase and rationalize our decision - so we are more likely to accept and be happy with our order.

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✋ Limitations

• The research is based on a large-scale analysis of one ecommerce retailer in the US, without additional supporting experiments. Although it’s unlikely, there is a higher chance than usual that this effect might be unique to this company.

• The study is based on a fashion retailer’s data. Fashion is an industry where people may be more likely to make returns in general (low price, emotional and impulsive purchases subjective to judgments like trends, fit, and taste, unlike practical products like tools or medicine, which are less likely to be returned).

• The studied retailer has a return policy of 30 days. Different return policies may change this effect.

• The research only analyzed the standard delivery option (where the delivery time is out of retailers' control). It did not compare it with a paid express delivery (where the delivery time is quick and can be accurately anticipated).

🏢 Companies using this

• Most e-commerce retailers focus on offering speedy delivery (e.g. according to eMarketer, delivery time decreased from 6.5 to 4.4 days in the US from 2020 to 2022) and giving options to pay for express shipping. 

• Most retailers do already provide an expected delivery window, rather than a specific date.

• Some retailers allow customers to choose different delivery options (usually standard vs. more expensive express) to fit their needs better.

• Cross-border, international retailers tend to offer a wider delivery window (e.g. Temu’s delivery time can range from 6-22 days), which can help to lessen buyer’s remorse. 

• Very few retailers have made any effort to reduce post-purchase regret. Most post-purchase communication is usually directed at collecting reviews or pushing additional purchases. 

The retailer would be better off giving a date range estimation for delivery, including the earliest possible arrival, rather than suggesting a fixed date and time. 

⚡ Steps to implement

• Analyze your shipping duration and return trends, especially if you sell emotional, impulsive goods (e.g. fashion, toys). 

• Instead of giving an exact shipping estimation date (e.g. “we will deliver on October 7th”), show a range of days including the possible earliest time of arrival (e.g. “we will deliver between the 6th and 9th of October”). 

• Reduce the chance of post-purchase regret with follow-up communication (e.g. an email workflow that reassures customers about the item they just bought). You can emphasize the product benefits, show usage suggestions, and positive customer reviews, or share your frequently asked questions.

• Offer multiple shipping options, including a “green delivery” that is slower but climate-friendly and has a broader delivery window. This can reduce the likelihood of return but also justify a slower pace. Sustainability initiatives also signal trust and product quality for small businesses and startups.

🔍 Study type

Market observation (analysis of 1,802,467 US orders from January to June of 2019, of one of the largest fashion retailers worldwide)

📖 Research

The faster, the better? The impact of short delivery times on product returns in online retailing. Journal of Retailing (August 2024)

🏫 Researchers

• Simon Masuch. Faculty of Management and Economics, Julius-Maximilian University of Würzburg, Germany

• Jan R. Landwehr. Faculty of Economics and Business Administration, Goethe University Frankfurt, Germany

• Christoph M. Flath. Faculty of Management and Economics, Julius-Maximilian University of Würzburg, Germany

• Frédéric Thiesse. Faculty of Management and Economics, Julius-Maximilian University of Würzburg, Germany

Remember: This is a new scientific discovery. In the future it will probably be better understood and could even be proven wrong (that’s how science works). It may also not be generalizable to your situation. If it’s a risky change, always test it on a small scale before rolling it out widely.

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