The UK is now the worlds worst affected market for parcel theft. 19 million parcels went missing from porches and other “safe places” across the country in 2022 [1]. As a result 1 in 3 UK residents are worried about deliveries getting stolen or going missing [2]. What kind of impact does this have on your conversion rate? How many online shoppers don’t end up making a purchase with you because they are worried about potential delivery issues?
Yet, the woes don't end there. When something does go wrong it can have serious consequences. Over 40% of customers will leave a negative review after a bad delivery experience - and then share it with 12 people [3]. Ouch! For businesses, this means not just a lost sale but potentially a tarnished reputation, all because of a delivery gone wrong.
Enter the concept of ProtectMyOrder. How do consumers perceive this? Is it viewed as a prudent safeguard or an unnecessary add-on? Does it enhance trust or is it met with skepticism?
What is ProtectMyOrder?
ProtectMyOrder enables merchants to upsell delivery protection to their customers at checkout, increasing a merchants net profit by ~10%
The merchant keeps the revenue generated through ProtectMyOrder
If a customer opts in to delivery protection and something goes wrong with their delivery, they get in touch with the merchant to get compensation
The merchant will prioritise resolving issues for customers who have opted into ProtectMyOrder, so the consumer gets a faster and smoother customer service experience
Consumer perceptions:
This study is based on:
Quantitative data: results of 70 merchants using ProtectMyOrder
~3m orders per year
85% of this volume is in the UK. 10% is in the US and the remainder is ROW
Qualitative data: 20 research calls with a random sample of UK based online shoppers:
Ordered at least 1 product online in the past 3 months
Either male or female
Aged 16 to 65 years old
Items like tickets, digital downloads, and holidays were excluded from the research
What percentage of customers purchase ProtectMyOrder at checkout?
Type of merchant
Average opt in rate
Range
All
61%
40% - 80%
Fashion & Apparel
60%
55% - 73%
Beauty
66%
55% - 77%
Home & Garden
66%
60% - 70%
Conclusion: the majority of consumers purchase additional protection at checkout
What are the impacts of ProtectMyOrder on conversion rates?
We conducted A/B tests with merchants where 50% of website visitors were shown ProtectMyOrder and 50% were not. We then compared the results of the two cohorts
In every test we have done conversion rate increased. An apparel merchant saw a 18% increase in conversion rate for the cohort who saw ProtectMyOrder. This test was done over 4 weeks
This is likely because worried shoppers get peace of mind that they’ll be covered if something goes wrong with their delivery making them more likely to purchase
“Sessions Saw PMO” is the cohort that saw ProtectMyOrder at checkout
Customers who haven’t conducted the A/B test have reported that there has not been a negative impact on conversion rate. Most of them say that there has been no impact
We suggest merchants run A/B tests on conversion rates if they want to see results for their own store (we can help set this up)
Why do customers purchase ProtectMyOrder?
Why did you purchase ProtectMyOrder?
Percentage
Doesn’t trust delivery companies
Eg. Their local Evri driver has caused delivery issues in the past
43%
Has had bad experiences with other merchants in the past and find it difficult to trust new brands
29%
Worried about international deliveries. Since Brexit, international shoppers purchasing from the UK have had more delivery issues
14%
Lives in an apartment block where theft is common
14%
What do the people who don’t buy ProtectMyOrder think?
Some consumers decide they do not want to purchase delivery protection. These customers shrug their shoulders at ProtectMyOrder, saying it doesn’t impact their perception of the product.
Why didn’t you purchase ProtectMyOrder?
Percentage
Order value not high enough to justify paying extra (less than £15)
14%
Not experienced delivery issues in the past
43%
A faster resolution process is not worth the additional cost
43%
Why is there either a positive impact or no impact at all on conversion rate?
What consumers say:
For those that buy delivery protection, it gives peace of mind that, if anything happens to their delivery, their won’t be a hassle
For those that didn’t buy it, they just shrugged their shoulders. They know that a lot of parcels get stolen but they’ve never had a problem with it so don’t need extra protection
Aren’t consumers already covered by the consumer rights act?
Section 29: The goods remain at the trader's risk until they come into the physical possession of— the consumer, or a person identified by the consumer to take possession of the goods
It is not clear if the consumer has come into physical possession of the goods if a parcel is stolen
If an item is stolen, then the tracking will say “delivered” so the merchant can argue they have delivered the package, and the consumer has come into physical possession of the goods
The consumer will not have received anything, so they will argue they have not come into physical possession of the goods either
So there is a disagreement of whose possession the goods are in
The difficulty with parcel theft is that there is never any evidence to prove the item has been stolen. It’s simply the consumers word against the merchants
Consumers know this and parcel theft scams are very common. People just say their item was never delivered, and they get their money back from generous merchants
Safe place
There’s ambiguity with customer rights when it comes to stolen parcels. The ambiguity surrounds whether the item has been delivered to a ‘safe place’ or to the ‘nominated address’. For example, the courier may deem the concierge of a flat block to nominated as the recipient of the parcel. The parcel is left in the mail room where it is then stolen. Technically, the consumer is no longer covered by the consumer rights act, but the consumer may disagree
Consumers have been burned in the past
Just because consumers have rights, doesn’t mean they will always be compensated
There are plenty of companies that don’t believe the consumer, and it’s very unlikely the consumer would take legal action against the merchant
Many consumers we have spoken to have experienced ugly claims processes - all they can do is leave a bad review and hope for the best
This upsell provides them peace of mind that if something goes wrong they have an easy resolution process
If consumers felt protected by the consumer rights act (or even by credit card companies) 3 out of 5 consumers wouldn’t purchase delivery protection
Strategies for Implementing Delivery Protection
1. Use A/B Testing (Our Magic Tool!):
Introduce delivery protection to a segment of your audience and measure its impact on conversion rates, as compared to the segment without the option. This way, you'll get real-time feedback on its effectiveness.
2. Play around with pricing:
No two merchants are the same. Some merchants will be able to charge more for delivery protection than others, depending on the types of products they sell and the customers they have. A/B test different price points to figure out pricing that maximises revenue and conversion rates. (We can help with this)
3. Transparent Communication:
Clarity is key. Clearly explain what delivery protection covers. Will there be refunds? Replacements? A bonus? The more transparent you are, the more customers will trust this new feature. (We can help with this)
Conclusion
The majority of customers purchase delivery protection when provided the option. This trend is driven by increasing parcel theft and delivery issues. Delivery protection also boosts customer confidence and, in many cases, conversion rates for merchants.
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