Shippo’s E-commerce Shipping Trends Predictions For 2022

With another year into the COVID-19 era, it’s time to take a look at what’s ahead for e-commerce shipping in 2022.

Will we continue to see the kinds of supply chain challenges that plagued merchants throughout 2020 and 2021? How will advances in technology and changing consumer preferences impact shoppers’ expectations into this year and beyond?

Let’s take a closer look to set your business up for success in 2022.

Supply Chain Challenges are Far From Over

Few businesses would have predicted, back in 2020, that the world would not only still be coping with the impact of COVID-19, but that we’d have taken steps backward in some ways. Yet, the emergence of new variants like Delta and Omicron — both of which are more contagious than the wild-type Alpha — mean that ongoing disruptions throughout 2022 can’t yet be counted out.

Unfortunately, this means that the supply chain pressures retailers have been facing for years will likely continue as the status quo this year. E-commerce shipping could be slowed down for both buyers and sellers. In an article in the Wall Street Journal, Derek Leathers, chief executive of truckload carrier Werner Enterprises Inc., reports that he expects contract rates to rise by high single-digit to mid-double-digit percentages throughout 2022.

While he expects prices to moderate eventually, he’s quoted as stating that, “We don’t foresee that until 2023. All of 2022 we view as a capacity-constrained market with inflationary pressure and with significant equipment disruptions.”

Our Prediction:

Given the consistency of reports regarding supply chain challenges, we agree that 2022 is likely to be marked by ongoing disruptions. Which particular items or components will be most affected remains to be seen, however, as lockdowns continue to affect different areas of the world disproportionately, at different times, and for different durations.

What This Means for Your Business:

As you head into 2022, it’s smart to be strategic about your sourcing. If you haven’t already taken the time to identify multiple suppliers for key materials or components, now’s the time to do so. You may also consider increasing the inventory you hold to hedge against future shortages, assuming doing so isn’t cost-prohibitive and any excess resources you hold have a good chance of selling in the future.

Early Holiday Shopping Becomes the New Normal

In our 2021 State of Shipping Report, 23% of the merchants we surveyed mentioned “Shipping” as a response to the question, “What keeps you up at night when it comes to readying your business for the 2021 holiday season?” In fact, concerns around shipping came up more than any other issue raised by participants.

Yet, despite reports indicating that consumers started their online holiday shopping earlier than ever before — and despite estimates that 2021’s total holiday shopping would eclipse the records set in 2020 — deliveries were largely on time. According to data published by New York Times contributor Niraj Chokshi, “The UPS and the Postal Service delivered about 99 percent of their packages on time by that measure between Nov. 14 and Dec. 11, and FedEx was close behind at 97 percent.”

So what happened? It’s likely that a number of factors contributed to a smoother holiday shopping season than expected. For instance, many retailers incentivized customers to make their purchases early, including publishing estimated delivery times and proactively notifying customers about the need to buy early.

Even with efforts like these, however, Salesforce’s analysis of the holiday shopping season found that, “Retailers nabbed 23% of their holiday sales during the final two weeks of the year, up 11% from the previous year.” Unprecedented efforts by regional and global carriers to add capacity, as well as increased utilization of alternative delivery strategies (like ‘buy online, pick up in store’, or ‘BOPIS’) likely also contributed to the season’s success.

Our Prediction:

Assuming the economy remains largely steady and that consumers’ purchasing power isn’t impacted too greatly by inflation, we believe we’ll see the longer holiday shopping season become normalized in 2022.

What This Means for Your Business:

First, most retailers will want to start their Black Friday and holiday shopping season planning earlier than in years past. The more time you have to plan, the more you can be strategic about your e-commerce shipping plan, among others.

• Planning day-specific promotions around items you can easily fulfill, such as pre-planned bundles you can pack ahead of time and ship quickly.
• Structuring your communications to keep up the momentum with both your early shoppers and your late-season buyers.
• Incentivizing sales to ship before carriers implement seasonal surcharges or increased fees.
• Implementing new technology and strategies that give customers more options for delivery or local pickups.

New Delivery Technology Will Put Shoppers in the Driver’s Seat

Home delivery retail losses are on the rise. According to one survey, Americans lost “about $5.4 billion from package theft over the past 12 months courtesy of porch pirates.” Though e-commerce retailers already use strategies such as delivery windows and secure locker pickups to mitigate parcel theft, merchants should expect even more options on the horizon in 2022.

In an article for Retail TouchPoints, contributor Mark Robinson predicts that “We will see more opportunities for consumers to select delivery windows and package lockers provided by carriers. Other companies will enter the marketplace, offering solutions such as secure access to mailbox/gate codes or even access to an individual vehicle’s trunk through various technology company offerings.”

Our Prediction:

Although new technologies may enter the marketplace in 2022, it may take time before they are proven and cost-effective enough to justify the investment by smaller e-commerce retailers. However, there are plenty of other strategies these businesses can use to both increase customer satisfaction with the delivery process and limit package theft.

What This Means for Your Business:

If you aren’t already taking advantage of features such as scheduled deliveries, signature confirmations, or branded tracking pages to keep customers informed and protect their shipments, Shippo can help.

Learn more about requiring signatures upon receipt with Shippo, scheduling deliveries through FedEx Home Delivery, and using branded tracking pages to create a shipping experience buyers will love.

Delivery Communication Expectations Will Become a Brand Differentiator

On the topic of branded tracking pages, another opportunity to empower e-commerce consumers comes from setting better delivery expectations through more transparent communications.

As consumers, we all understand how desirable accurate delivery estimates are — and how much they influence our satisfaction with our overall purchase experience. Yet, our State of Shipping report found that only 22% of survey respondents currently send customers to a branded order tracking page — and only 43% fulfill orders and send customers’ shipping information within 24 hours of their purchase.

Our Prediction:

Even carriers like FedEx are investing in improving the estimated delivery times they provide to customers. That’s why we believe that the brands that invest in keeping customers informed throughout the e-commerce shipping process won’t just increase shopper satisfaction — they’ll actually build a competitive advantage over less transparent companies.

What This Means for Your Business:

If you aren’t shipping packages within 24 hours, look for ways to optimize your operations and decrease fulfillment times. You can also maximize the marketing value of your delivery communications by implementing branded tracking pages — like those offered by Shippo — rather than directing your customers to carrier tracking pages.

Succeeding in 2022 Will Require Strong Partnerships

Overall, we expect that e-commerce shipping in 2022 will look and feel like a continuation of 2021. Supply challenges are likely to continue, even as consumer expectations regarding everything from delivery options to communications will continue to increase.

As adapting to this new reality may drive increased expenses for some e-commerce businesses, finding the right partnerships — particularly those that can drive cost-savings — will be critical.

If shipping costs are cutting too far into your margins, Shippo can help you access the best shipping label rates from some of the world’s top carriers. Our deep discounts can save you as much as 89% off USPS shipments, 86% off UPS international deliveries, and 63% off packages shipped through DHL Express.

Sign up for free today, or reach out to our product specialists for a personalized consultation.