Labor shortages cripple the cross-border and last-mile networks of an eCommerce business’s primary carrier. Fortunately, the business has a robust plan in place to overcome this sort of disruption, enabling it to reroute its packages so that they’re delivered by or close to the estimated delivery date. All is well.

Except it’s not. Yes, the operational reports confirm that the deliveries were completed. But they don’t record that customers were unable to track their packages via the replacement carriers and weren’t informed they would now have to be home to sign for their parcels, something the primary carrier didn’t require. And while customer support logs record those who called or emailed with queries or complaints, they don’t measure how many other customers were equally disappointed or angered but remained silent. In short, the reports don’t disclose that the delivery experience was materially worse than customers had been promised or expected, nor how many might change their behavior as a result. 

How disruption becomes a trust issue

From an operations point of view, delivery completion is binary; either a package was delivered or it wasn’t. The experience surrounding it, however, is cumulative. Tracking invisibility, lack of timely communication, unexpected duties or taxes, conflicting information: any such changes degrade the customer experience and, with it, the customer’s trust in the merchant.

In this way, customer experience degradation becomes the third stage of the shadow loss chain. First is structural exposure, the vulnerabilities inherent in an organization’s shipping program. Operational events such as a carrier strike or a port closure bring these vulnerabilities to light. And if a business’s response to the events, such as rerouting volume to a different carrier, results in a disappointing delivery experience, some of the affected customers might decline to make a subsequent purchase.

That’s because customers don't experience a carrier network, a routing strategy, or a contingency plan. They experience a promise. So in addition to measuring delivery success, businesses need to assess whether, in the eyes of the customer, they kept that promise and with it, the customer’s trust.

Customer visibility, organizational visibility

This is where it’s important to distinguish the two types of visibility within the shadow loss chain. 

• Customer visibility refers to whether the customer receives timely, accurate information regarding changes to the original delivery promise. 
• Organizational visibility refers to whether the business can identify which customers were exposed, what experience they received, and how they behaved afterward. 

Providing satisfactory customer visibility during the shipping process can reduce customer experience degradation. Organizational visibility, meanwhile, enables the business to identify which customers actually experienced a delivery journey that differed materially from the one originally promised.

That distinction matters because not every customer affected by an operational event experiences the same thing. One customer might receive a package late. Another might lose tracking visibility. A third might be asked to pay an unexpected duty or sign for a delivery that previously required no signature.

The critical question at this stage of the shadow loss chain, therefore, is not simply whether an operational event occurred. It is “Which customers were exposed to a materially different delivery experience, and what changed for them?”

Customer support inquiries and complaints cannot answer that question on their own. They capture the customers who chose to speak up, not the full population whose experience changed. Without identifying that exposed population, a business cannot later determine whether those customers reordered, reduced their spend, or disappeared altogether.

The frictions that degrade the customer experience

From the customer’s point of view, package delivery should be simple. They place an order, the merchant receives the request and provides a delivery window, and the package is shipped from the merchant to the customer’s door. 

Businesses, of course, know that the process is far more complex. When an operational event changes how an order moves through that system, customers can receive a materially different experience from what was promised. The degradation may take several forms:

• Changing delivery estimates. Weather conditions, labor disruptions, port closures, and vehicle shortages are just a few reasons promised delivery times cannot be met. 
• Conflicting delivery estimates. The merchant might offer one estimate via its logistics system, the carrier another. Neither estimate, therefore, is credible, nor in the customer’s eyes is either source.
• Unfamiliar handoffs. A customer used to tracking parcels as they travel from point A to point B before arriving at their home might be confused to see that this time, the parcel is traveling from point A to point B to points C and D. 
• Lack of tracking. When the tracking mechanism suddenly becomes unavailable, the customer may worry not only about the package’s whereabouts but also about the merchant's reliability.
• Unexpected taxes or duties. A customer who thought they paid duties upon ordering will be unpleasantly surprised when required to pay an additional, previously undisclosed fee to ensure delivery. 
• Late deliveries. Customers might perceive packages that arrive within the SLA terms as late if they arrive after the promised delivery date.

A lack of communication about the causes and effects intensifies the friction. Customers tolerate a delay they’re warned about and understand far better than one they have to discover on their own. Uncertainty without an authoritative explanation forces the customer to infer whether anyone knows or cares, leading to distrust. Silence about the friction becomes part of the failure.

For this reason, customer visibility must be treated as an operating discipline rather than a service nicety.

Three responses to friction

Response to friction manifests itself among customers in three ways:

• Expressed friction. Customers contact support, complain, request compensation, or leave a scathing review.
• Behavioral friction. Customers keep checking tracking, hesitate before reordering, order less next time, or quietly abandon a future purchase.
• Silent exit. Customers accept what happened, say nothing, and never come back.

Only expressed friction shows up reliably in conventional reports. Behavioral friction and silent exits point out the danger of relying solely on operational reporting to determine whether a “successful” delivery was indeed successful in maintaining the customer’s trust. 

Carrier data confirms the arrival of the order. Support data confirms whether the customer asked for help. Neither confirms whether trust survived. SLA compliance, exception rates, and support tickets are all event metrics rather than experience metrics. 

That’s why you need to identify the exposed customers: so that you can compare their behavior with customers whose delivery experience wasn't impacted.

How first-time international customers differ from repeat buyers

A repeat customer who experiences a late delivery compounded by a lack of communication might have enough prior trust in the merchant to read the disruption as an exception, making them more amenable to giving the brand another chance in the form of a repeat order.

For a first-time customer, however, this same late delivery and lack of communication serves as their baseline experience with the brand. They have no other experiences with the company to compare it with. So they’re likely to assume this is what buying from the brand is like, and would be like going forward. 

Customers typically don’t view customer experience degradation as the fault of the carrier, weather systems, or geopolitical events. It’s not the carrier, the weather, or politics that promised their parcel would arrive by a certain date under certain terms. The merchant made the promise, and it’s the merchant who will receive the lion’s share of the blame should the promise be broken. A repeat customer might understand that a broken promise is the exception for the merchant; a first-timer might assume broken promises are the rule.

Preparing for inevitabilities

Some of the vulnerabilities that make up the shadow loss chain are inevitable. Trade-offs inherent in the design of a shipping program inevitably result in a degree of structural exposure. Operational events beyond an organization’s control, such as carrier strikes and storms, test the structural exposure. And even when a business has proactively implemented qualified alternatives to compensate for the exposure and minimize the effects of operational events, a degree of customer experience degradation might well ensue.

Providing customers with visibility into the changes they might experience from an operational event can smooth out some of the friction associated with stage three: customer experience degradation. But it doesn’t necessarily eliminate stage four of the shadow loss chain: silent churn. Nor does it quantify any resulting retention or economic loss. To measure that downstream impact, the business first has to identify which customers experienced a materially different delivery journey.

Determining your shipping program’s structural exposure and resilience in the face of operational events enables you to mitigate customer experience degradation and, with it, silent churn. The ePG Market Readiness Assessment is a quick way to appraise the vulnerabilities of your program so that you can strengthen it, and in turn strengthen consumer trust in your brand.

FAQ: Customer experience degradation

What is customer experience degradation in the shadow loss chain? The third of four stages in the shadow loss chain, customer experience degradation is where customers feel unexpected friction in the shipping process, such as changing delivery windows or a broken tracking tool. It follows stage one, structural exposure inherent in the shipping program, and stage two, operational events such as carrier strikes that test the program’s vulnerabilities. One way customers react to the disappointing experience is with silent churn, the fourth stage of the chain.

Why doesn't a "delivered" parcel guarantee a good customer experience? Changes in the delivery process can result in a “successful” delivery that is nonetheless a poor customer experience. For instance, if a customer can no longer track the delivery or now has to pick up the package at the carrier’s facility instead of receiving it at home, they’re likely to find the experience disappointing. Operations logs will record the package as delivered, but they don’t capture how the customer experienced the delivery. 

What's the difference between expressed friction, behavioral friction, and silent exit? All three are customer reactions to a degraded experience. Expressed friction is when customers make their concern or disappointment highly visible through calls to customer support, emailed complaints, and the like. Behavioral friction sees customers quietly change how they interact with a brand; they might frequently check tracking, hesitate before reordering, or order less next time. Silent exit is when customers say nothing about their experience but never come back.

Why does communication matter when a delivery promise changes?  Customers are much more likely to tolerate a disappointing experience when they are kept apprised of any changes because the communication minimizes uncertainty. Without an explanation, customers might infer that the merchant doesn’t know or care about the experience degradation, leading them to distrust the brand.