Case Study: How MotoSport Sped Up Its Shipping Process

Problem: MotoSport, a catalog/multichannel retailer of power sports apparel, parts and accessories to motorcyclists and recreational vehicle owners, needed a faster, more flexible online shipping logistics system.

Solution: Teamed with a software solutions provider to rework shipping rules.

Results: Increased customer loyalty and repeat purchases as a result of customized and personalized shipping offers — with significant gains in sales, average order size and shipping cost reductions expected.

To reduce shipping costs by giving customers more options, MotoSport upgraded its logistics system by deploying new software.

Office Rules software from Haley uses a natural language (i.e., English) determination engine within MotoSport’s Web-based ordering system to find the best option for shipment based on customer
preferences for time of delivery and shipping method (ground vs. air). This allows MotoSport to change its billing rates or logistics options quicker and more effectively.

“We wanted to be able make selective and promotional offers, and alter shipping fees based on their loyalty value and location,” says Faramarz Farhoodi, chief information officer/vice president of e-commerce at the Tualatin, Ore.-based MotoSport.

MotoSport also sought the ability to change shipping offers due to economic changes, in particular the rising cost of fuel. “For all of that,” he says, “you need to have a lot of flexibility as external conditions change. For us, it was important to be able to make those changes within days of making a policy change.”

This speed to market represents a significant upgrade for MotoSport. Previously, the company’s shipping rules were hard-wired to enterprise resource planning applications by rigid rules and algorithms. Any major change to shipping logistics forced computer code to be rewritten by programmers, and that could take three to six months. But with the Office Rules software, the e-commerce platform is controlled by MotoSport employees who understand the needs of their customers. Changes to shipping options or offers that used to take months now are reflected on the Web site within a few days.

“It allows the system to be handed over to the experts who understand logistics or customer experience,” says Grant Colley, strategic account director at Haley.

The move figures to benefit MotoSport’s bottom line, too. Farhoodi expects shipping costs savings of 2 percent to 5 percent as a result of the new system.

Since installing the software in February, MotoSport has turned its attention to improving the customer experience; in particular, by customizing shipping options and promotions on an individual basis. As a by-product of better customer service, Farhoodi says MotoSport has set a lofty goal of 5 percent to 10 percent lift in sales and average order value.

Some MotoSport customers, especially off-road riders who often break their bikes, frequently need to replace parts. These customers are more apt to favor two-day shipping. But other customers may be more sensitive to cost than speed of delivery. The new software serves up the most appropriate offer to the individual customer based on personal profiles and preferences.

MotoSport previously had used a “one-size-fits-all” approach to its shipping program, Farhoodi says, serving up the same offers to every customer, regardless of their order’s size, how often they shopped with MotoSport, where they lived or other relevant factors.

“By customizing our shipping offers,” he says, “we hope to optimize costs, in addition to the benefit to customer service and customer satisfaction.”