According to Reuters, last U.S. holiday shopping season showed stores could be offering a significant advantage over e-commerce giants like Amazon. ‘Click and Collect’, or sales where customers order goods online and pick them up at a nearby store, soared 47 percent in November and December compared with a year earlier, outstripping 16.5 percent growth in online sales, as confirmed in research conducted by Adobe Analytics.
Several stores announced big increases in such sales, including Best Buy Co Inc, Target Corp, Walmart Inc and Home Depot Inc. The experience of the 2017 holiday season, where bad weather and a late surge in online orders overwhelmed shipping firms and led to delays, is likely to have contributed to the surge in store pickups last season, retail experts say. Yet even as UPS and FedEx largely avoided a repeat of the problems this time, analysts say store pickups, when handled right, offer enough benefits for consumers and retailers alike to keep gaining importance.
According to retail research and consulting firm GlobalData Retail, store pickups accounted for nearly a third of U.S. online sales in November and December, compared to about 22 percent a year earlier and just over 17 percent during the 2016 holiday season. The method “brings together the benefits of the digital shopping experience…with the instant gratification of same-day store pickup and easy returns,” said Jeff Sylvester a senior analyst at Foresee, a company that studies customer experience.
Shoppers, on their part, avoid shipping costs and the agony of waiting for the delivery and can get help from store staff if any issues come up. Steve Molloy, a web designer who shuttles between Sydney, Los Angeles and San Francisco, said a 3-1/2-week delay in delivery of a pair of Nikes he ordered online during the 2016 holiday season made him switch to in-store pickup. “It feels like you have a little bit of control,” he said.
Retailers save on packaging and delivery costs as they have items on sale in their in-store backrooms rather than a distant warehouse. Foresee’s Sylvester estimates that the Click and Collect process costs retailers about $5.60 in packaging, labor and fuel to deliver goods ordered online. Factoring in other costs, retailers stand to make a 25 percent gross profit on a shipment of $82, the size of an average online order during the 2017 holiday season. The store pickup option raises that margin to at least 33 percent, he said.
More than a third of customers who come to collect their orders end up buying something else, said Tom McGee, chief executive of International Council of Shopping Centers, a global trade association. During the holidays that number increases to 86 percent, he said.
Seems like Click and Collect could also offer some peace of mind to purchasers of AV hardware or software too…