As more and more retailers focus on providing customers with an omnichannel experience, buy online and pick up in-store has emerged as an effective method for blurring the lines between the digital and physical experience. Retailers are embracing buy online and pick up in-store as a fulfillment option because it helps them to stay ahead of the competition and improve their customer experience by saving customers time. It also reduces cart abandonment by eliminating expensive shipping and freight charges, and helps to capture new customers and build loyalty by offering fast and convenient fulfillment.
Also known as click and collect, buying online and picking up in-store is becoming one of the most popular ways to shop for consumers. In fact, a recent study by Blackhawk Engagement Solutions found that 45% of respondents had used a click and collect option within the past 6 months. Retailers can help to increase this rate by providing consumers with discounts and a streamlined experience:
- 86% of consumers would consider using click and collect if it offered a $10-50 savings
- 78% would consider using it if they could receive their item three days faster.
Consumer behavior is the driving force behind the increasing adoption of click and collect. Today, the path to purchase for consumers is no longer linear. Instead it might involve the web, social media, a mobile app, an in-store visit, and an online purchase. The challenge for retailers is to provide customers with a consistent user experience, regardless of the channel or device being used.
Currently online sales are (surprisingly) only 7.4% of the $1.2 trillion in overall U.S. sales, meaning that the majority of people still prefer to shop in-store. With consumers both demanding the convenience to shop or compare prices online, while still preferring to complete purchases in-store, click and collect is a perfect fit for many retailers.
But click and collect doesn’t just help retailers distinguish themselves from the competition. In fact, allowing shoppers to buy online and pick up in-store can increase sales and profits. One reason for this is that retailers save on shipping costs. Shipping costs tend to eat up a generous portion of margins for online sales, and the pick up in-store option reduces that cost. Additionally, this arrangement means that customers have to physically enter the store, where they are likely to make an additional purchase.
Retailers that offer click-and-collect are discovering it to be very well received by customers. Kirkland’s, an online home decor retailer recently released an earnings report and found that 70% of their online revenue came from orders that were fulfilled using the buy online, pickup in-store option. Even more astounding is that shoppers using this fulfillment option spent nearly twice as much as shoppers using conventional shipping.
But with new technologies comes new challenges. And the main challenge with click and collect is fraud. Think about it like this: not only does omnichannel retailing provide users with several paths to purchase but also several paths to fraud. The current fraud rate for click and collect purchases is 2.15% and that number is expected to increase by 28%. This is partially because some retailers don’t require customers to re-run their card when they pick up products in-store, making it easy for fraudsters.
One thing for retailers to keep in mind is that click and collect has to be done well. It’s not something you can add to your online store and forget about. A study by StellaService looked into how convenient buying online and picking up in-store really is and found that while it can be more convenient, customers are often subject to a quite a lot of wait time. This illustrates that retailers need to be conscious of wait times and in-store inventory while offering click and collect as a fulfillment option. Home Depot overcame this issue by allowing shoppers to schedule a pickup time, which helped create a more streamlined model by informing the store when to have the product set aside for the customer.
As omnichannel retailing becomes even more ingrained in commerce overall, it will be exciting to see how new technologies and services further cloud the distinction between a physical and digital shopping experience.