FD THURSDAY_2

Failed Deliveries4 August 2016

By CX Interns

Strictly Confidential

Indonesia Philippines

Malaysia Thailand Singapore Vietnam

HOW DID YOU FEEL WHEN YOU DID NOT

RECEIVE YOUR ORDER?

What is failed delivery? Issues overview Recommendations Forecast and Justification

Agenda

Two Types of Failed Delivery: 1. Does not get delivered to doorstep

2. Refused at doorstep

4% of all deliveries are failed deliveries Parasite to a good customer experience

What is Failed Delivery?

To eliminate customers’ pain points during failed delivery

processes andcreate a better customer

experience

Goal

What is failed delivery? Issues overview Recommendations Forecast and Justification

Agenda

CUSTOMER JOURNEY MAP – FAILED DELIVERY

Customer places order in website 3PL delivers order

Customer receives ‘shipped’ sms and

email

CUSTOMER JOURNEY MAP – DELIVERY PROCESS

3PL delivers order

Step-13PL gives an upfront call to check customer’s availability

Step-23PL rider goes for delivery

Step-33PL rider at delivery address

Customer places order in website


email

CUSTOMER JOURNEY MAP – FAILED DELIVERY

Customer places order in website 3PL delivers order

Customer successfully

receives order

Customer does not receive order


email

Customer receives NPS survey

Customer receives FD CES survey

Customer receives cancellation email

CES Failed Delivery- Survey Blue print

Case 1 Case 2Customer reports that there was no communication or delivery attempt by the 3PL

Customer is asked to report the reason behind failed delivery in case an attempt was made by the 3PL

9Situational Analysis Recommendations ConclusionImplementation & financials

Q1. Did you receive a call ?

Q2. Did 3PL show up at your door ?

Q3. Why did you refuse your package?

NO

NO

Q1. Did you receive a call ?

Q2. Did 3PL show up at your door ?

YES

YES

Q3. Please give us some feedback

Customer versus LEX Failed Delivery

10

Failed Delivery Reason from MATCHED CES Report and LEX Delivery Report – Week 27-29%

Inconsistency between LEX and customer reason for failed delivery In order for 3PL to not be penalized for a failed delivery, inputting “Refused at Doorstep” puts blame on customer

Did Not Deliver Refuse at Door 0.00%

10.00%

20.00%

30.00%

40.00%

50.00%

60.00%

70.00%

80.00%

32.56%

67.44%

56.40%

43.60%

LEX Reason Customer Reason

23.84%

23.84%

Situational Analysis 10Situational Analysis Recommendations ConclusionImplementation & financials

“ไมไดรบการตดตอมาในวนกำาหนดรบสนคาและไมมเจาหนาทโทรเเจงวามการเลอนวนรบสนคา ( แตมเจาหนาทตดตอมาหลงจากพนกำาหนดวนรบสนคา ) ** ควรมการปรบปรงวนกำาหนดรบสนคาใหชดเจนมากกวาน ขอบคณคะ”

“There was no call from 3PL on the scheduled delivery date and no one called to inform me that the delivery postponed. Call was made after it has past the delivery date.”

Key Takeaway Lack of communication

Deep Dive (1/2) Example of CES Response

Example 1: Order # 336952329LEX Tracking #336952329-1334

Customer Response:Phone call made No delivery made

3PL Response: Refused at Doorstep


CONTRADICTION

“พนกงานจดสงโทรแจงวา ทานไมอยบานในวนทจะสงสนคา 30 ม.ย. เพราะฉะนนทานตองยกเลกการสงแลวสงใหม ...และในใบสงซอกบอกวาจะจดในวนท 1 หรอ 2 ก.ค. แตจะมาสงวนท 30 ซงเราตดธระดวนพอด”

“Deliveryman called to say that as I am not available on June 30th, the day he was planning to come, I must cancel my order with Lazada. Furthermore, in the website it stated that they would be delivering between July 1-2. I just happened to be busy on the 30th.”

Key Takeaway Early delivery Inappropriate action by 3PL Scheduling issue

Deep Dive (2/2) Example of CES Response

Example 2: Order #344579429LEX Tracking #MP212293623

Customer Response:Phone call madeNo delivery made

3PL Response:Refused at doorstep


CONTRADICTION

Customer versus LEX Failed Delivery Reason

13

Top Failed Delivery Reason from CES Report and LEX Delivery Report – Week 26-29 %

No Communication from LEX is biggest issue according to customer - LEX fault Customer postponing is biggest issue according to LEX - Customers fault

Customer Postpone

Unreachable Refused at Doorstep

Customer not at home

Customer not at Address

0%

5%

10%

15%

20%

25%

30%

35%31%

26% 25%

14%

3%

LEX Failed Delivery Reason

No Commu-nication

Wrong Info Deliver not as Scheduled

Change Mind Scheduling Issue 0%

10%

20%

30%

40%

50%44%

18%13% 13% 13%

Customer Failed Delivery Reason

Situational Analysis 13Situational Analysis Recommendations ConclusionImplementation & financials

ReinforceAlternateVerifyIllustrateNotify

14

Failed Deliveries Improvement –Executive Summary

Purpose

Issues

Recommendation

Conclusion

To eliminate customers’ pain points during failed delivery processes

Increase customers awareness of the delivery process

Customers feel at ease during failed delivery process and repurchase at Lazada

Encourage 3PL to make a delivery attempt

Educate Endorse

CUSTOMER JOURNEY MAP – DELIVERY PROCESS

3PL delivers order

Step-13PL gives an upfront call to check customer’s availability

Step-23PL rider goes for delivery

Step-33PL rider at delivery address

Customer places order in

website

Customer receives

‘shipped’ sms and email

Customer fills in contact

details


16


Purpose

Issues

Recommendation

Conclusion





Educate Endorse

NOTIFY – SMS customers to prepare for 3PL calls


• “ขอใหม e-mail และ SMS แจง 1.ควรมการแจงลวงหนา วาจะมาสงวน/เวลาไหน จะไดรอ 2.เบอรตดตอกลบเพอนดหมายกนใหม หากไมสะดวกทจะนดกนในวนดงกลาว ”

• “I want SMS or email 1 day ahead of the delivery which day/time the order will be delivered so that I can wait, and provide a contact number in order to reschedule”

• The customer wants SMS or email notification to prepare for delivery

“Your item is now with our carrier. Please expect a call from our carrier before the

delivery. You can also check your order status in

your email.”

CES Comment Breakdown

ILLUSTRATE – Info-graphic in ‘Order confirmed’ webpage and ‘Shipped’ email


Two most-viewed customer touch points

Info-graphic will effectively illustrate the delivery process


• Key message of the infographic : prepare for 3PL calls• Customers tend to look at pictures rather than long instruction• 90% of information transmitted to the brain is visual, and visuals are processed 60,000X faster in the brain

than text. (Sources: 3M Corporation and Zabisco)

http://www.billiondollargraphics.com/infographics.html

http://www.webmarketinggroup.co.uk/Blog/why-every-seo-strategy-needs-infographics-1764.aspx

Customers are unaware that their personal information will be used in delivery process


Customers fill in work address, home or office number and inaccurate

information.

SMS and 3PL will not reach them during

weekend

Detractor Breakdown“พอดตดธระเลยไมไดรบโทรศพท ซงทอยในการจดสงเปนททำางาน และหยดวนเสารอาทตย หากจดสงวนนกคงไมสะดวก จงขอเลอนเปนวนจนทร โดยแจงวาใหโทร. มากอน”“I was busy so I didn’t pick up the call. The address was my office and it closes on weekends. I’d like to postpone to Monday.

The customers were not aware that personal

information were crucial to a delivery company“ความผดพลาดคอใสเลขทอาคารผด ขอเปลยนเปน 268 อาคารระเบยง

จามจร”“The mistake occurred when I filled in the wrong building number. Please change it to 268 Chamchuri Building.”

Other websites – Adding new address

Amazon Gmail

Reminders during adding new address will increase accuracy of information


Mobile phone *

VERIFY- Pop ups to increase accuracy of information

We may call or send you SMS when we deliver your order.

We suggest using your mobile phone number ex.099-999-9999

Please double check your address ex.111 Sukhumvit11 Thonglor

Mobile phone *


VERIFY- Pop ups to increase accuracy of information

เราจะใชเบอรโทรศพทในการ ตดตอคณระหวางขนสง เราขอ แนะนำาใหใชเบอรมอถอ เชน

091234567 โปรดตรวจสอบวาทอยของคณถก ตอง เชน 11 สขมวท 11 แขวง

เขต

โทรศพทมอ ถอ *

โทรศพทมอ ถอ *



24


Purpose

Issues

Recommendation

Conclusion





Educate Endorse


Customer Comment Breakdown

“เนองจากเขาทำางานแปดโมงเชาตองปดโทรศพทจะเปดไดเวลา12.00-13.00น.อยากใหตดตอเบอรคณสบล เบอร0877822053”

“Since I am working from 8AM, I need to turn my mobile phone off. I am only able to turn it on from 12PM to 1 PM. I would like you to contact Khun Subil at 0877822053”

• The customer has second contact, but there is no field for the information

ALTERNATE – Customers have more than one number and addressSome customers have second contact picked up their orders

Djkl;ajksdl;ajkl;dsjkl;fjks;djk;ad

Contact (Why?)

Name

Mobile Phone

Adding a second contact will increase chance of successful delivery


Mobile phone *

บคคลตดตอสำ�รอง(Why?)

ชอ และ น�มสกล

โทรศพทมอภอ

โทรศพทมอถอ *

Djkl;ajksdl;ajkl;dsjkl;fjks;djk;ad

Second Contact (Why?)

Name

Mobile PhoneGot it!

Adding an alternative contact will help us reach you incase we are unable to contact you.

โอเค!

ขนสงของเราจะตดตอบคคลสำารองถาเราตดตอคณไมได

REINFORCE – Customer versus LEX Failed Delivery

Failed Delivery Reason from MATCHED CES Report and LEX Delivery Report – Week 27-29%

Inconsistency between LEX and customer reason for failed delivery In order for 3PL to not be penalized for a failed delivery, inputting “Refused at Doorstep” puts blame on customer

Did Not Deliver Refuse at Door 0.00%

10.00%

20.00%

30.00%

40.00%

50.00%

60.00%

70.00%

80.00%

32.56%

67.44%

56.40%

43.60%

LEX Reason Customer Reason

23.84%

23.84%


27.43% of failed deliveries from week 26-29 failed on the first day of delivery : – Have 3 attempts really been made? The highest % of failed deliveries, 34.76%, happens on the second day of delivery LEX’s SOP : No attempts will be made after the third attempt to control lead time

Failed Delivery After First AttemptLEX Daily Report Week 26-29

0 1 2 3 4 5 6 7 80.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

Customer not at home or not reachableRefused at DoorstepCustomer Not at AddressCustomer PostponeUnreachable/Incorrect/Unclear Address


LEX Hub organization chart

• Overlooks the hub’s performance (OTIF)

• Control lead time < 4 days and < 3 attempts

• 1 per hub

• Assigns parcels to each driver’s route

• Check drivers’ daily performance

• Works full-time

• Each takes care of 5 drivers

• 5 per hub

Supervisor

Dispatcher

• Delivers as much as possible

• Fill in failed delivery reasons

• Works according to 1-year employment contract

• 30 per hub

Driver


Lazada’s 3PL compares hub reports with CES Survey3

Drivers fill in failed delivery reason at the end of the day 3-4PM 1

Dispatcher call out to customers who ‘refused at doorstep’ to validate driver’s claim2

Pilot at LEX TH - Daily validation process filters out fake failed delivery reasons and enforces LEX drivers to make 2nd attempt


If there are fake failed delivery reasons, OTIF will be deducted4

Supervisor and dispatcher’s penalty

If Lazada’s 3PL match LEX FD report with CES results and fake reason was found,

• Hub’s OTIF will be deducted • Supervisor and dispatcher have

harder time reaching their KPI

Penalties affect LEX directly; drivers, dispatchers and supervisors


Driver’s penalty

If fake reason was found by a dispatcher,

• ‘refused and doorstep’ will be changed to ‘did not deliver’

• warning strike will be given1st strike = verbal warning2nd strike = suspended3rd strike = discharged

24

Next week Lazada can start…

Conclusion 32Situational Analysis Recommendations ConclusionImplementation & forecast

2016

Educate

Endorse

1 2 3 4

Pop up box when add and edit

address

Add info graphics

Modify SMS

Add second contact

Analyze 3PL and customers’ failed delivery reasons

Implement penaltyOTIF deduction

5

Introduce refused at doorstep validation(Train new SOP) Start refused at doorstep validation

Our recommendation can decrease LEX failed delivery rate by up to 2.96%

Conclusion 33Situational Analysis Recommendations ConclusionImplementation & forecast

Assumptions

Based on

• 3PL failed delivery reason (Unreachable 26%)

• Lazada’s failed delivery rate

week 29 (4%)

• LEX failed delivery growth rate during June

2016 (35%)

Week N+0 Week N+1 Week N+2 Week N+32.0%

2.5%

3.0%

3.5%

4.0%

4.5%

4.00%

3.38%

2.95%2.80%

4%

LEX Failed delivery rate per week

With strategy Without strategy

CUSTOMER JOURNEY MAP – FAILED DELIVERIES (BEFORE)

Pre-Service Period Service Period Post-Service Period

3PL delivers Item status changed to “cancelled”

Place order

Customer receives order confirmation

email

3PL calls customer to reschedule

Customer receives Email and SMS that the order is

shipped

Cancellation notification

OB contacts customer to

refund

Customer receive refund

Customer is at home

Customer is not at home

Cancellation email

Case summary and CSAT survey

Refund Notification

Touch Points

Poor Experience

Customer contacts customer service

Customer tracks his order

3PL arrives as scheduled

Customer refuses the order

Customer doesn’t pick up

Customer reschedule

Customer check his email

3rd attempt of delivery

3PL calls again

Customer calls CS

Failed delivery survey

1st-2nd attempt of delivery

Customes want to cancel

Customers fill in details

Conclusion 34Situational Analysis Recommendations ConclusionImplementation & financials

CUSTOMER JOURNEY MAP – FAILED DELIVERIES (AFTER)

Pre-Service Period

Service Period Post-Service Period

3PL delivers Item status changed to “cancelled”

Place order

Customer receives order confirmation

email

Customer receives Email and SMS that the order is shipped + please pick

up calls

3PL calls to schedule a

delivery time

3PL calls upon arrival

Cancellation notification

OB contacts customer to

refund

Customer receive refund

Customer is at home

Customer is not at home

Cancellation email

Case summary and CSAT

survey

Refund Notification

Touch Points

Poor Experience

Customer contacts customer service

Customer tracks his order

3PL arrives as scheduled

Customer refuses the

order

Customer picks up

Customer check his

email

3rd attempt of delivery

Customer calls CS

Failed delivery survey

1st-2nd attempt of delivery

Customers want to cancel

Customers fill in mobile phone no.

and correct address

Customer reschedule

Conclusion 35Situational Analysis Recommendations ConclusionImplementation & financials


36


Purpose

Issues

Recommendation

Conclusion





Educate Endorse

LEX has the most failed delivery among other 3PL Absolute Values for Refused at Door and Did not Deliver Customer and LEX Top Failed Delivery ReasonsFrom CES Survey

APPENDIX

LEX has the most failed delivery among other 3PL

Acommerce_Skybox

DHLTH Kerry LEX LEX+ Kerry Thai Post0

2

4

6

8

10

12

14

16

18

20

1

4

1

1

2

24 4

2

2

6

2

2

1

11

3PL issues by each 3PL absolute number WK28

Bad manner and language Did not deliver at doorstep Did not deliver on committed timeDid not inform customer before delivery Product damage Delivery policy

LEX failed 2.25 times higher than KERRY And 18 times higher than DHL

Absolute Values for Refused at Door and Did not Deliver

Source of 3PL Reason is from LEX Week 27-29 report – Matched order number with CES Survey Source of Customer Reason is from CES Week 27-29 Survey

Count of 3PL Reason Count of Customer Reason

Did not Deliver 56 97

Refused at Doorstep 116 75

Grand Total 172 172

Customer and LEX Top Failed Delivery ReasonsFrom CES Survey

Top customers reasons week 26-29

Customer ReasonNo Communication 59

Wrong Info 24

Deliver not as Scheduled 18

Change Mind 17

Scheduling Issue 17

Grand Total 135

Top 3PL reasons week 26-29

3PL Reason

Customer Postpone 6300

Unreachable 5439

Refused at Doorstep 5157

Customer not at home 2897

Customer not at Address 669

Grand Total 20372

Failed Delivery After First AttemptLEX Daily Report Week 26-29

Number of Days Between Pick up Date and Failed Date

3PL Failed Reason 0 1 2 3 4 5 6 7 8 9 10 11 Grand Total

Customer not at home or not reachable 16 419 863 793 422 227 118 30 7 2895 16 419 863

Refused at Doorstep 1253 1849 1105 569 250 93 24 10 3 5156 1253 1849 1105

Customer Not at Address 324 257 66 12 10 669 324 257 66

Customer Postpone 2425 2487 999 289 80 17 3 6300 2425 2487 999

Unreachable/Incorrect/ Unclear Address 1569 2067 1060 437 130 68 14 3 5348 1569 2067 1060

Grand Total 5587 7079 4093 2100 892 405 159 43 1020368 5587 7079 4093

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