The Next Big Thing in E-Commerce is Already Here

Ally Feiam By Ally Feiam | 25 Sep 2019

Every few months, there’s a new trend that takes over the retail industry. From personalisation to drone delivery, there’s never a shortage of ways to engage with customers and increase revenue. For several months, more brands have been introducing Click and Collect – so is this the next big thing? 

Since 2014, online retail has seen a rapid uplift – in 2019, the market was estimated at a value of AUD 5.09 trillion compared to 2014 when it was AUD 19 trillion. Within five years, online retail has experienced a metamorphosis.

With an increase in E-commerce sales across the globe, it’s becoming increasingly more difficult for brands to stay up to date with shipping and store fulfilment. “When we look at the Australian market, we see that the growth trend is set to continue, just like the global graph prior. With retail growth rates in the low single digits, it’s clear that online shopping is going make up a greater proportion of business and hence the challenge of keeping stores relevant and managing online fulfilment is set to continue,” explained Dave Hughes, the GM e-Commerce at Briscoe Group in New Zealand.

What’s the Next Big Thing?

It may take a while before drone delivery becomes the norm (despite its unveil by the Iconic in Canberra earlier this month), but retailers need a new way to quickly deliver the goods to its customers without costing them too much. As same-day delivery becomes normalised for customers, the strain on retailers is becoming far too apparent.

Rather than focus on delivering to the door of customers, which is timely and not cost-effective, the obvious step for retailers is to focus on Click and Collect. Sure, it certainly isn’t a new idea, but it’s only just being picked up by retailers across the globe.

What Does Click & Collect Involve?

Just as the name suggests, the concept behind Click & Collect involves an omnichannel approach for a business. Customers can make a purchase online, but they go in-store to collect the item. There are a few different types od Click & Collect for retailers to consider before they leap the strategy:

  • In-Store Click & Collect
  • In-Store Lockers
  • Remote Pickup
  • Ship-to-Store

Who’s Doing Click & Collect (Successfully)?

Spanish fast-fashion retailer, Zara, is introducing a Click & Collect locker within its flagship store in Hamburg, allowing customers to pick up their online orders within just fifteen seconds of scanning their assorted barcodes. The lockers offer space for 700 parcels and is the third of its kind for Zara. There’s a catch, though – customers can only get their order during the opening hours of the store.

Australian home improvement retailer, Bunnings, has begun its Click & Collect offering too. From August 2019, the Wesfarmers-owned company is starting to expand its range across all sales platforms. “While it is still early days in respect to our online offer, rest assured our investment in data, digital and the in-store experience, which will always be central to our DNA, will be focussed on how we continue to deliver a competitive and relevant offer wherever and whenever customers choose to shop,” explained Bunnings General Manager, Michael Schneider. Ths brand’s Click & Collect service allows customers to make a purchase online and pick up the items within the Victorian warehouses. Bunnings accounts for 57 per cent of Wesfarmers’ earnings – last month Wesfarmers’ Managing Director, Rob Scott, noted that Bunnings’ sales had increased by five per cent in the previous 12 months, ending June 30th. Despite the downturn in the national housing market, the sales rose to $13.2 billion.

Nordstrom offers a couple of different types of Click & Collect – curbside and in-store. The former is an option for customers who wish to have their goods delivered to their car by a member of staff. When the customer arrives, the staff member (who already knows the registration number of the vehicle) will walk to the designated car and drop off the goods. The latter is a traditional form of Click & Collect, allowing customers to enter the store and gather their products.

The Pros and Cons

As with all new strategies, a company needs to evaluate the pros and cons before going ahead – what may work for Wesfarmers might not work for your brand.

Pros:

  • Less money spent on parcel delivery
  • Gives customers control of their delivery options
  • Acts as a cheap alternative to ‘free shipping.’ 
  • Far easier for bulkier items to reach the collection point

Cons:

  • Picking the order may take extra time
  • There may be hidden costs behind the click & collect service
  • Creating a parcel locker only provides a small amount of time for customers to receive their goods

Things to Consider

Globally, Click & Collect has become one of the normal aspects of online shopping. It’s also considered one of the most valuable aspects for customers when making a purchase, with o four in ten customers preferring this form of delivery, according to a study by iVend Retail. In 2018, 81.4 per cent of online retail shoppers bought an item with the intention to pick it up in-store. However, there are a few parts of the Click & Collect strategy that retailer has to consider before implementing the strategy into their daily delivery routine.

  • Consider additional inventory within the store – Training staff to cope with the extra load of stock and inventory is imperative to maintaining a strong customer experience. “Imagine someone going to a store to collect an item that they ordered online. When the customer asks for the product, the sales assistant turns around to pick up the item off a shelf. As soon as the assistant takes their eye off the customer, the satisfaction drops twenty per cent,” explained Phil Leahy, the CEO of Retail Global.
  • Make sure there’s enough room in-store for your Click & Collect department – If you don’t have enough room within your store for this, you may want to consider creating a locker in a separate section of the store.
  • Signage is essential for customer experience – If a customer has no clue where to collect their goods, their experience goes down the drain. Put up signs to direct them to the Click & Collect area. Otherwise, you’ll have staff leading them every few minutes within their day.
  • Cover all bases – Make sure your staff has a full understanding of the Click & Collect process. There’s nothing worse for a customer’s day when they are trying to understand the collection procedure and talk to staff with the same understanding as them.

Overall…?

Click & Collect is coming our way faster than expected. Due to high delivery costs and changing customer habits, it’s the natural next step to bridge the gap between retailers and their consumers. However, there are always hidden costs and consequences behind these new strategies. If your brand has issues and is falling behind on its store fulfilment, this may just be the next best thing for your brand.

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