Would you recommend your parcel carrier?


The UK parcel market is undergoing rapid growth and competition between carriers is fierce. Customer satisfaction is becoming one of the central battlegrounds as companies vie to win and retain contracts but how would you choose your preferred carrier? Answering that question may well be the key to prevailing over stiff competition.

The UK domestic parcel market was estimated at £4.1bn in 2013, with a projected 2013-2017 CAGR around 6%. Much of this current demand is driven by the e-commerce sector which continues to experience double digit growth. However, it is a much more challenging environment for carriers due, in part, to the price pressures exerted by the dominant players such as Amazon, ASOS, M&S and Next.

‘Word of mouth’, or a recommendation from a trusted source, is becoming an important factor for shippers when formulating the last mile delivery strategies. As such, carriers are increasingly having to work harder to keep their retail customers, as well as the final recipient customers, happy and CEOs are stating that customer satisfaction is now of paramount importance. David Smith, City Link’s CEO, leads the call outlining the need to, “spearhead a culture change which empowers the customer – A revolutionary vision.” Dwain McDonald, GeoPost UK’s CEO, is on record stating, “our key mantra is that, it starts and ends with the customer.” While Carole Woodhead, CEO of Hermes UK, believes, “we need to be able to support them [the customers] with the best possible solution in the marketplace.” Finally, Neil Lloyd, Yodel’s CEO, has said, “I am keen to ensure that Yodel develops a reputation for first class customer service.”

Unfortunately, measuring customer satisfaction is an arduous task for the shipper. However, they have a number of sources on the internet, and can also use social networks by which they can gauge the main criteria in determining the suitability of a carrier – namely; providing the right quality, e.g. call centre staff and driver’s attitudes; reliability, e.g. on time deliveries without breakages; and meeting service needs, e.g. easily accessible returns options.

Most UK carriers measure customer loyalty through Net Promoter Score (NPS) which monitors the likelihood of customers to recommend a carrier’s services to others. Yodel stated its NPS improved from -10.45% to +47.27% to August 2014 (Post and Parcel), DPD stated that it has an NPS of 38% (Transport Motor Awards 2014) and Royal Mail stated in its 2013-14 first half results that overall NPS increased from 14% to 20%. These scores provide customers with valuable insight and can form part of a wider assessment when formulating last mile strategies, however, ongoing visibility and trends are hard to come by for all carriers.

In the absence of true customer ‘experience’ transparency, sites such as Trust Pilot – which claim to measure the ‘voice of the customer’ on an ongoing basis – and the Money Saving Expert website – which annually polls members to establish the public’s perception of a carrier’s performance – have stepped in to fill the void and have highlighted a demand for such data. Should carriers provide better visibility of their own customers’ satisfaction scores, it would augment a shippers’ ability to make informed decisions. Most UK carriers do at least now provide an element of customer satisfaction feedback, primarily via social media, however, this tends to highlight positive satisfaction and in no way provides concrete, or comparable, measurements of a customer’s likelihood to recommend them.

Presently in the UK, the choice of the last mile delivery carrier is determined by the retailer – depending on the speed of delivery requested by the customer. Where there are ongoing adverse delivery experiences, the final customer has the option of taking his business to another retailer or ‘putting up with’ an inferior service. One way to alleviate negative perceptions is for carriers to be more transparent and publish regular announcements on their NPS scores. This would allow retail customers to monitor their customers’ delivery experiences and make informed decisions on future last mile delivery strategies.