eCommerce Businesses Auto-Ship to Create Steady Stream of Revenue
The Fulex ecommerce order management system is designed to manage continuity fulfillment programs.
In the e-commerce world, ecommerce businesses work very hard to attract buyers to their products. After attracting the buyer, the sellers must make it easy for the buyer to make an initial purchase, and encourage them to make repeat purchases. One way to do this is by offering flexible purchase options, including the ability to sign up for automatic repeat shipments of the product.
This type of option is commonly referred to as “Auto-Ship” or “Continuity” fulfillment, and it is a powerful tool for online retailers. In some cases, continuity programs may involve repeat shipments of the same item. In other cases, it may involve shipping a series of different items.
An auto-ship option makes it easy for the consumer to purchase the products they need, provides the online retailer with a steady stream of revenue and generates orders at the ecommerce warehouse to fulfill on an on-going basis. There are many variations in the types of, and applications for, continuity fulfillment.
The Fulex ecommerce software system is capable of effectively managing continuity programs. Below, we review several types of opportunities available to our ecommerce clients that have online businesses.
Put Repeat Orders on Auto-Ship for Consumables
In this type of Auto-Ship program, the buyer can place an order for repeat shipments of a product that they use or consume on a regular basis. Once they sign up, orders will be generated automatically at set intervals. Credit Cards will also be processed automatically or, if applicable, invoices will be generated. Vitamins and nutraceuticals are commonly sold in this manner. Other examples might include air or water filters, printed tray liners and take out menus for a restaurant chain, or anything in which the consumer or business has an on-going and predictable need for the product.
Buyer Choice is Key
Supporting this type of Auto-Ship program requires a software system with a good deal of flexibility in how the program offerings are configured. In some cases, the buyer may be considering a first time purchase of the item and may not be ready to commit to receiving on-going shipments. As an online retailer, you may want to allow the buyer an option of a one time purchase as well as the ability to sign up for on-going shipments. In addition, you may allow their customer to indicate the frequency in which they will receive shipments and the quantity they will receive in each shipment. The customer may be sent on-going shipments indefinitely, or may be allowed to choose the total number of order recurrences.
Incentivize the Buyer
The easiest way for you to encourage someone to order more of their product, is to provide a financial incentive, (a discount) to the consumer. The Fulex software system allows you to provide discounts not just based on quantity, but based on the frequency of shipments. The per unit price of product shipped every 30 days may need to be less than the same quantity shipped every 90 days.
Serial Continuity Fulfillment Programs
Serial continuity programs involve sending the buyer a series of different products, in some cases for a fixed number of recurrences, and indefinitely in others. Examples of serial continuity include wine clubs and book of the month programs. In some cases, these programs are highly structured and do not require the customer to be provided with flexible purchase options. In other cases, such as the wine clubs, buyers will typically be provided with choices regarding the frequency of recurrence and the quantity per shipment. Two other important distinctions within serial continuity programs is whether the program involves a fixed or rolling bill of materials.
Fixed Bill of Materials
In this type of program, a specific product will be shipped to customers during each Continuity period, regardless of when they signed up. If April’s “White Wine of the Month” is a 2010 Pinot Grigio, everyone will receive the Pinot, whether the buyer joined the program in December or March. An advantage of this type of program is that it gives you the ability to predict inventory requirements for each period and to produce or procure inventory accordingly.
Rolling Bill of Materials
Rolling Bill of Material programs involve sending all buyers the items in the exact same sequence, regardless of when they signed up. One example of this type of program is a seller offering a series of books as part of course of study in which the books are intended to be read in a specific order.
There are some other things to consider in your Auto-Ship Program:
Expired Credit Cards
Because Auto-Ship programs typically involve charging the customer’s credit card with each shipment, the system used to manage the orders should include provisions for automatically sending alerts in the event of an expired or otherwise denied credit card, and for suspending further shipments until the credit card information is updated. In addition to notifying the customer, the system should also provide an easy mechanism for modifying their account information including updating their credit card information and changing their shipping address.
Suspending Shipments
In some cases, you may want to allow consumers to suspend shipments temporarily. For example, if the customer is planning on taking an extended vacation, they may not wish to receive shipments during this period. Allowing them to place a temporary suspension on their shipments enables the ecommerce retailer to preserve the account. Without this option, the consumer would be likely to cancel entirely. Ideally, the system used to manage the continuity orders will have options enabling the consumer to choose to completely skip the shipments during the suspension, or to accrue the orders and send them en masse when shipments resume.
Want to learn more about Continuity Fulfillment options?
We know our online retailers work extremely hard to make an initial sale. An Auto-Ship option allows you to reap the benefits of your marketing efforts over the long-haul, as the cost per sale drops significantly after the initial order is placed.
In addition, because an Auto-Ship option helps sellers to establish a long-term relationship with buyers, it can provide ecommerce businesses with upsell and cross-sell opportunities with an audience with whom they have already established credibility.
Contact us to Learn more about how the Fulfillment ecommerce software manages continuity fulfillment programs so you can benefit from an ongoing stream of customer orders.
We have fulfillment warehouses in:
- San Diego, California
- Chattanooga, Tennessee
- Detroit, Michigan