Operational Impact of Communication Channels: Evidence from Last-Mile Delivery Services

Communication channels are often used to improve customer satisfaction and behavior. This paper studies how they can be used to enhance operational performance.
We partner with a last-mile delivery company and, through natural and field experiments, explore the effects of communication channels on a key metric of the process: failed deliveries. We find that using more salient communication channels (instant messages versus emails) increases the reach of the information. However, contrary to expectations, we find that it increases the likelihood of failed deliveries. Using natural language analysis, we explore the mechanism behind this result and find that instant messages increase customers’ tendency to try (unsuccessfully) to coordinate delivery times and locations. Finally, we examine the value of providing information to customers via self-service channels. Our results suggest that customers who track their deliveries have higher failed delivery rates, indicating that these channels may identify harder-to-serve customers.
Our work demonstrates the relevance of communication channels as drivers of operational performance. We provide evidence that communication channels can be used to manage customers’ expectations and behaviors and that customers can offer valuable information to the service process. We also highlight the importance of aligning the communication channel with the operational process. Understanding and supporting channel norms is essential for achieving such alignment. In particular, we show how these levers can significantly reduce failed deliveries, which incur very substantial costs in the delivery process.