Smart Lockers: The Best Package Insurance for Your Customers

As the e-commerce business grows, so does retailers’ responsibility to ensure customers receive their purchases safely. With over 58 million Americans experiencing package theft and global theft rates reaching 26%, protecting deliveries has become as crucial as the products themselves.^1,2 The United States and Canada lead the world in package thefts, highlighting a widespread security challenge that can directly impact customer satisfaction and your bottom line.

The numbers are sobering: U.S. package thefts totaled 119 million in 2023 alone, at a cost of $13.4 billion.³ Each stolen package isn’t just a financial loss, though; it’s a damaged customer relationship and a hit to your brand’s reputation. As online shopping continues its upward trajectory, it is time to implement robust delivery security measures that protect both your customers’ purchases and your company’s reputation.

Porch Piracy Leads to Innovative Solutions 

There’s a known liability between when a package arrives on a customer’s doorstep and when the customer actually retrieves the package. A business’ liability typically ends upon transferring a package to a carrier, and a carrier’s liability ends upon delivery. This leaves unmonitored packages ripe for porch pirates’ taking with few options for consumers to take legal recourse, as many states do not consider package theft a felony.

This liability hasn’t gone unnoticed by retailers, who are increasingly adding services to make receiving orders more secure. For example, Best Buy enhanced its delivery services in select states with two key features: two-hour delivery windows that customers can schedule, and live tracking for large item deliveries and installations. Best Buy CEO Corie Barry noted that these improvements have both elevated customer experience and reduced customer service costs.⁴ Further, new third-party services, such as Corso and Route, have emerged to meet customer support and replacement needs. Some retailers are automatically adding this type of coverage to every package, charging consumers anywhere from $3 to $7 per package.⁵

However, when retailers cannot provide protection or reimbursement, consumers are finding that their options are less than helpful. Credit card coverage is limited, and homeowners’ insurance deductibles (typically $500) make claims impractical. Several insurance providers have surfaced to address reimbursement for package theft, including PorchPals, XCover, and InsureShield. For instance, PorchPals offers annual coverage for up to three package thefts, with a $2,000 maximum claim limit, for a $120 yearly fee. These and other expensive solutions, such as doorbell cameras and security systems, are among the tools consumers are turning to prevent porch piracy and seek reimbursement if they fall victim to it.

The cumulative effect of these efforts is that the burden and the cost of protecting purchases largely winds up getting passed onto the consumer. If your business is not adapting its services to ensure that customers have a free or low-cost method to protect their orders, you run the risk of hurting your customer loyalty and satisfaction scores.

Smart Lockers: The Most Effective Protection for Your Customers’ Purchases

Rather than passing responsibility along to customers, instead consider the best theft prevention solution money can buy: retail parcel lockers. Investing in these secure, video-monitored locker systems can significantly reduce theft and other types of shrinkage while providing your customers with peace of mind about their purchases.

Using lockers for order pick-up is straightforward and secure: store associates retrieve items directly from store inventory and place them in a designated locker. The locker maintains the security of the goods until the customer arrives for collection, eliminating the vulnerable period between the item leaving secure inventory areas and customer retrieval that often leads to theft. The customer is automatically notified when their order is ready, and they can collect their purchase at their convenience – with no waiting in line required.

Lockers also offer benefits beyond theft prevention. Retailers can substantially lower delivery costs by fulfilling orders directly from store inventory and using lockers as pick-up points. This streamlined approach eliminates the need for last-mile delivery services and associated expenses while reducing the risk of lost or stolen packages that require replacement or refunds. Integrating store inventory with secure pick-up creates an efficient, cost-effective solution that protects both retailer and customer interests. Smart lockers also decrease greenhouse gas emissions and alleviate roadway congestion by eliminating the need for direct-to-door delivery and consolidating orders to a centralized location within retail stores.

Manage MORE Than Just BOPIS: Streamline Your Returns Process Too

Not only do retail parcel lockers assist with customer order retrieval, but they can also support returns – a service that can help you boost foot traffic, sales, and customer loyalty. According to a recent Retail Customer Experience Survey Global Report, 62% of consumers say they would buy more from a brand if they had a positive experience with returns.⁶ Further, the return process with lockers can be as quick as 7 seconds, and returning to the store is the lowest hit on your margins.

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Smart lockers help retailers address the liability gap between purchase and customer retrieval while offering multiple benefits: reducing theft, lowering delivery costs, boosting customer loyalty, decreasing environmental impact, and even streamlining the returns process.

Ready to make shopping more secure for your customers? Speak to a Parcel Pending representative today to lock in your solution!

Sources:

1. Reuter, Dominick. Insuring deliveries against porch pirates requires some surprisingly tricky math, but one founder says he’s figured it out. www.businessinsider.com. December 7, 2024. https://www.businessinsider.com/insuring-deliveries-against-porch-pirates-takes-tricky-math-ceo-says-2024-12
2. Vivint. Protecting Your Packages: Global Porch Piracy Insights. www.vivint.com. n.d. https://www.vivint.com/resources/article/global-porch-piracy-insights
3. Capital One Shopping. Package Theft Statistics. capitaloneshopping.com. October 13, 2024. https://capitaloneshopping.com/research/package-theft-statistics/
4. Garland, Max. Best Buy launches scheduled parcel delivery. www.retaildive.com. December 9, 2024. https://www.retaildive.com/news/best-buy-scheduled-small-product-delivery/734960/
5. Moise, Imani. Porch Pirates Are Now Raising the Price You Pay at Checkout. www.wsj.com. December 25, 2024. https://www.wsj.com/personal-finance/package-theft-hidden-fee-higher-prices-325c4a34
6. Signifyd. The State of Commerce 2022. www.signifyd.com. July 27, 2022. https://www.signifyd.com/state-of-commerce-report-2022/