Logistics Challenges to Watch in 2024 (& How Great CX Can Help Overcome Them)

Let’s say you’re an Operations Manager at a global logistics company.

There has been a rise in damaged goods and your B2B customers are explaining it’s because of how items are stored in transit to their next location.

Workers in the supply chain have had difficulty reaching the team responsible for making an adjustment or worse — don’t receive any responses at all, and customers aren’t happy.

One logistics company that’s run into similar challenges discovered a solution that has now completely transformed its global closed-loop feedback process (and boosted customer retention).

DHL Supply Chain increased satisfaction through transparency and implemented workflows for customer experience (CX) reps to ensure effective responses for each customer group within the appropriate time frame.

It’s led their ways of doing business to be more speedy and efficient for both the company and its customers.

Their (not so) secret?

Building out a world-class B2B CX program to increase sales and deliver exceptional experiences at every customer touch point — we’ll let them explain the ins and outs of their program later on.

To start, let’s explore emerging logistics trends, identify the imminent challenges, and understand how prioritizing CX can be the solution to overcoming them.

Logistics Trends

In the evolving landscape of logistics, staying responsive to emerging trends is crucial for adapting to the changing demands.

As we look forward, several key trends are expected to shape the logistics sector:

• eCommerce Boom. The global eCommerce boom continues to reshape consumer behaviors and expectations. With more consumers opting for online shopping and the phenomenon that CustomerGauge Co-Founder & CEO, Adam Dorrell, calls “Amazonification,” creating demand for efficient and speedy deliveries is higher than ever.

This trend has led to the rise of innovative last-mile delivery solutions, such as drones, delivery robots, and crowdsourced delivery networks. eCommerce giants are investing heavily in optimizing their supply chain and distribution networks to fulfill orders quickly, accurately, and cost-effectively.

• Supply Chain Digitization. The digital transformation of supply chains is no longer a futuristic concept but a present-day one. Techs like blockchain, the Internet of Things (IoT), and artificial intelligence (AI) are being leveraged to enhance visibility, traceability, and efficiency across the supply chain.

Blockchain ensures transparent and secure record-keeping, IoT devices provide real-time tracking of shipments and monitor conditions, while AI-powered analytics enable predictive maintenance and demand forecasting.

• Sustainability Initiatives. With growing environmental concerns, sustainability is a trend here to stay. The logistics industry is actively seeking ways to reduce its carbon footprint. Companies are exploring eco-friendly packaging solutions, optimizing routes to minimize fuel consumption, and investing in electric and hybrid vehicles.

Additionally, urban logistics strategies are being developed to decrease congestion and pollution in city centers.

• Urbanization Challenges. The global shift towards city living poses unique challenges to logistics operations. Urban areas are becoming congested, making traditional delivery methods less practical. So, how are companies addressing this?

They’re piloting initiatives such as micro-fulfillment centers strategically located within cities, electric delivery vehicles, and autonomous delivery bots. These innovations aim to streamline last-mile delivery in densely populated areas.

• Resilience and Risk Management. Recent disruptions, such as the COVID-19 pandemic, have highlighted the need for resilient supply chains. In response, companies are diversifying suppliers, embracing multi-modal transportation, and building contingency plans to mitigate the impact of future disruptions.

Risk management is becoming a core competency in logistics strategies.

• Collaborative Logistics Ecosystems. The trend of collaboration among logistics stakeholders is gaining momentum. Businesses are recognizing that sharing resources, assets, and information can lead to improved efficiency and reduced costs.

Collaborative ecosystems involve partnerships between shippers, carriers, warehouses, and technology providers, fostering a more interconnected and agile supply chain network — aka, many B2B customer touchpoints that create opportunities to deliver incredible experiences time and time again.

Logistics Challenges

Logistics challenges looming ahead require proactive strategies and innovative solutions.

Companies must anticipate supply chain disruptions, manage rising costs, stay agile in the face of regulatory changes, navigate technology integration, adopt sustainable practices, and prioritize cybersecurity.

By addressing this head-on, logistics companies can position themselves for success in an ever-changing and dynamic industry landscape.

So, how can businesses like yours start to get ahead of all of these challenges?

Rome wasn’t built in a day, but you can always take the first step by creating a strong Net Promoter Score (NPS) program – more on that in a minute.

First, let’s chat more about these logistics industry issues.

1. Rising Costs in Fuel, Fleet Maintenance, and more

Fluctuating fuel prices, inflation, and increased transportation costs can significantly strain logistics budgets. Balancing the need for cost-efficiency with maintaining service quality is a delicate balancing act.

Companies need to optimize routes, explore fuel-efficient transportation options, and implement cost-effective inventory management strategies to mitigate the impact of rising costs.

2. Supply Chain Disruptions

Unprecedented disruptions in recent years have shaken the global supply chain ecosystem.

Natural disasters, geopolitical tensions, and the ongoing effects of the COVID-19 pandemic have highlighted the vulnerability of interconnected supply chains. Companies must develop agile strategies that allow them to quickly pivot in response to unexpected events, ensuring continuity and minimizing the impact of disruptions on their operations.

3. Labor Shortages

The logistics sector is facing a shortage of labor across various roles, from drivers to warehouse workers to skilled technicians. The aging workforce and the need for specialized skills are among other contributing factors.

So, to address this challenge, companies must invest in training and development programs, offer competitive compensation packages, and create appealing work environments that attract and retain talent.

4. Lack of Communication With B2B Customers

From courier to customer, a lot can go wrong.

A lack of understanding between all parties can lead to a cascade of issues including delays, miscommunications, and unfortunately, lost or damaged items. This not only results in financial losses but also tarnishes the reputation of the logistics provider.

So, it’s safe to say communication between logistics companies and all B2B touchpoints is the key to unlocking success.

To address this challenge, establishing a clear and concise communication system is crucial. This transparency instills confidence and keeps customers informed about the progress of their deliveries.

Additionally, couriers should provide regular updates to B2B customers regarding their shipments, alleviating uncertainty and enabling customers to plan their operations effectively — if only there were a tool to allow B2B customers to provide feedback and for businesses to reply in real-time 👀

In essence, effective communication isn't just a solution; it's the bridge that connects logistics companies and their customers to long-lasting relationships.

Importance of CX in Logistics

So, what do all of these logistics challenges have in common? They can be solved by uncovering customer insights through a strong CX program.

In the dynamic landscape of today's logistics industry, businesses can no longer rely on gut feelings — now is the time to make informed decisions based on true B2B customer data.

As the digital revolution continues to reshape logistics, companies that prioritize their CX are positioned to emerge as industry leaders.

Data-Driven Insights Are No Longer Optional

The transformative power of CX is no longer a secret; it's the driving force behind sustained growth and success.

To thrive in this environment, organizations must adopt methodologies that collect and assess customer feedback effectively. In the realm of B2B, certain methods are indispensable, and if they're not already part of your arsenal, now is the time to integrate them.

A great example? CustomerGauge’s Account Experience (AX) software and methodology.

With our best-in-class AX platform, DHL drove revenue using real-time feedback from the B2B value chain to help front-line staff and easily help their team...

• Bring 200-300 new contacts into the survey program each quarter
• Immediately route feedback to the team (even the C-Suite) that needs following up
• Monetize their program effectively by integrating sentiment and NPS scores into their sales process

The rapid evolution of technology has brought forth a new era in logistics, where the competition isn't just about moving goods efficiently but also about delivering an exceptional experience to customers.

This paradigm shift requires companies to harness real-time insights and deploy automated systems that monitor and respond to B2B customer feedback on a global scale.

Mining Gold From NPS Customer Insights

One such crucial tool is NPS, a customer loyalty metric that gauges the likelihood of customers recommending a company or its products to others.

Despite the changing landscape, NPS continues to reign supreme as the go-to metric for understanding customer sentiment. Plus, it’s trusted by over 100+ consumer packaged goods (CPG) companies globally — it’s proven its worth.

Businesses like DHL Supply have learned that NPS programs yield numerous advantages. Regularly collecting customer feedback through NPS surveys not only facilitates direct communication channels between brands and their clientele, but unearths priceless insights into customer preferences, buying behaviors, and emerging trends.

The feedback garnered through these surveys enables companies to fine-tune their business strategies, innovate new products, cultivate lasting customer relationships, and most crucially, outpace competitors that lag in adapting to the modern age.

DHL’s World-Class B2B CX Program Helped to Achieve a 100% Closed-Loop Rate

While DHL Supply Chain, part of the EUR 56.6bn DPDHL Group, is the world’s leading contract logistics provider, they've also built one of the world's leading Account Experience programs.

Since its 2016 program rollout, DHL increased its NPS by 10+ points in several countries and doubled its customer response rate.

For most businesses, handling such a high volume of responses could hurt their closed-loop rates — not for DHL. The business has consistently achieved a 100% closed-loop rate for detractors within 48 hours and resolves issues for all other customers within a week.

As soon as feedback pours in, it swiftly reaches the relevant team for follow-up.

And surprisingly, those responsible for closing the loop can even include top-level executives, including members of the C-Suite.

Senior managers and C-Suite members receive daily reports directly from CustomerGauge.

Any customers categorized as "low-scoring detractors" receive immediate attention from senior management. In cases where the account's revenue warrants it, C-level executives, including the CEO, have even been known to personally reach out and close the loop.

In a company as large as DHL Supply Chain, there are two primary challenges to building an exceptional customer experience program: adoption and implementation.

Markus Engel, VP of Sales Performance Management, explained that they adopt a bottom-up approach to maintain engagement in the program.

"We take special care with our customers who give low scores," Markus explains. "And when we involve senior managers in the follow-up process, we receive highly positive feedback."

Ultimately, the goal of any survey is to connect with customers, and DHL Supply Chain impressively achieves a 50% comment rate on their surveys.

"Direct feedback is emotional," Engel states. "Emotion might sound intimidating, but often, it's within the comments that we discover valuable insights. That's where we find the starting point for a conversation with the customer."

At the end of the day, it's this direct feedback, whether positive or negative, that motivates DHL Supply Chain to continue delivering exceptional experiences.

Tackle Logistics Challenges in 2024 With CustomerGauge

Challenges are much easier to face when you're prepared — or better yet, know they're coming.

As logistics companies navigate the complexities of today's market, those who prioritize customer satisfaction and invest in the right technology will lead the way, setting new standards for excellence and success.

Ready to get ahead? Reach out to our team to see a demo of Account Experience live!