Cost of Supply Chain Disruptions on Retailer Reputation

Sisu Data, the Decision Intelligence Engine, announced findings from its recent Supply Chain Consumer Impact & Sentiment study conducted on its behalf by The Harris Poll. The online survey of more than 2,000 U.S. adults provides clear insights into the impact supply chain incidents have on consumer sentiment and brand reputation.

The survey results were analyzed by both The Harris Poll and Sisu’s Decision Intelligence Engine to surface insights on the impact supply chain issues, such as late deliveries, processing delays, and lost orders, have on a consumer’s brand sentiment and what steps those retailers can take to improve brand loyalty.

Supply chain issues are changing the way consumers shop

A majority of American consumers (89%) purchased gifts online in the past year, with almost 3 out of 4 (71%) experiencing supply chain issues. Those who did experience these issues were faced with late delivery (64%), order processing delays (49%), or orders missing in transit (31%).

It is not surprising then that 72% of American consumers reveal that their gift shopping habits changed during the 2021 holiday season in an effort to avoid possible supply chain issues. Among those whose habits changed, nearly ½ (46%) say they started shopping earlier than usual, and around ⅖ (38%) finished shopping earlier than usual.

Brands’ reputations are taking a hit from supply chain incidents

The survey also revealed that most consumers (82%) would experience a “slight” or “major negative impact” on how they view a company if they experienced a late delivery. Roughly 3 in 4 American consumers (74%) feel retailers should be held accountable for those supply chain issues caused by their carrier partners. The impact of this blame can be seen in 15% of American consumers reporting they would never order from a company again after receiving an online order late.

Keeping disappointed customers loyal is as simple as saying sorry

However, the news is not entirely bad for retailers: 93% of American consumers confirmed that something could be done to improve their opinion of a company after an online order is delivered late. Coupon codes and discounts for future orders top the list of resolutions, with 45% reporting that a coupon code/discount for a future purchase would improve their brand opinion.

But surprisingly, over a third (36%) of American consumers reported that a statement of apology would improve their opinion of a brand following a delayed delivery.

“As data people, we wanted to go beyond accepting that supply chain incidents are increasingly impacting customers,” said Joel McKelvey, VP of Product Marketing at Sisu Data. “After digging into the ramifications for retailers feeling the pinch from supply chain impacts, we now have a better understanding of how these incidents impact consumers and what steps retailers can take to not only repair reputation damage, but also potentially increase the likelihood of repeat purchases—even after a late delivery.”