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[18 comments]

Will in-vehicle pickup replace in-store pickup?

February 13, 2014

Online ordering/in-store pickup has become a critical tactic in the sales strategies of many retailers. Now, Sears is looking to go one better on the convenience scale by enabling customers to place orders online and then pick up their purchases without having to leave their cars.

"The In-Vehicle Pickup option takes our 'Free Store Pickup - Ready in 5' guarantee even further and out to the parking lot," said Leena Munjal, senior vice president, Member Experience and Integrated Retail, Sears Holdings, in a statement. "In-Vehicle Pickup on this scale is an industry first and another example of how we are constantly innovating and adding benefits that make shopping a more convenient experience for our members."

To make in-vehicle pickup work, Sears requires customers to input details of the vehicle they'll use to collect their purchase. They'll also need to enable location services on the Sears' Shop Your Way mobile app before they leave for the store. When they arrive at the merchandise pickup area outside the store, they park in the designated in-vehicle pickup spots and use their mobile app to click on the in-vehicle pickup option. A timer starts counting down from five minutes. If their order doesn't come out in that timeframe, they'll receive a $5 coupon.

Ms. Munjal said the new program has gotten positive feedback from customers who have used it. "It's very convenient for senior citizens who have problems with movement or moms with young kids," she told The Washington Post.

FINANCIALS:     [NASDAQ:SHLD] [ ]

Discussion Questions:

Do you think online ordering with in-vehicle pickup will have wide appeal? How would retailers need to reorganize their store operations to make a service such as this work?

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

How likely is it that in-vehicle pickup will become commonplace at retail stores over the next decade?

Comments:

For those consumers looking to buy online, pick up in store (BOPiS), this could be of interest to them as it eliminates the need to exit one's car and enter the store, and am sure in inclement weather this has some appeal.

And much of whether this succeeds or not will be dependent upon the size of the merchandise pickup area as well as how it's managed. While it's clear the goal for delivery is to take <= 5 minutes, long waits there will frustrate consumers and defeat the purpose.

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Bill Davis, Director, MB&G Consulting

In the case of Sears, their in store pickup was typically at a back or side door that really didn't take you in the store anyway. So walking the goods out to the car could be a service that mom's with kids and senior citizens might appreciate at certain times.

The challenge for Sears is getting people to shop at their stores in the first place. Traffic and revenues have been dropping like a rock. Offering a service where the consumer never enters the store seems to be at cross purposes with driving traffic to stores.

This kind of walk out service definitely makes great use of integrating mobile phones and apps ... and correspondingly requires the infrastructure and people to implement. Sears had much of the at store pickup capability years ago, but the mobile app is new.

Hats off to Sears for finding a way to innovate the service and name ... but is perhaps a little too late to compensate for the other core retail issues at Sears.

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Chris Petersen, PhD, President, Integrated Marketing Solutions

As the article indicates, it may be popular with those that for some reason might not want to or find it difficult to leave their car. It certainly has appeal to our "in a rush" society.

It works for Sears because they are dealing with nonperishables and already have a pick up area. The infrastructure already exists (secure holding area, outside door, etc.)

I think that to execute this with perishables would be more difficult. It would mean having a holding area with quick access to the parking lot that can handle the various temperatures necessary, a system of identifying all the parts of an order, etc., and either a dedicated staff or staffing available to be ready and able to drop what they are doing to meet customers timing expectations. Could it be done? Certainly. Can it be done profitably? Not so sure.

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Steve Montgomery, President, b2b Solutions, LLC

All of the omnichannel, order online pickup at store and this latest hybrid shopping in your car is another distraction from the fact their brand is irrelevant for most shoppers.

Retail survives based on the answer to one question: What's new? That's not "what's new" in how it is delivered, but the original reason the customer shops there. Those who are doing retail well understand that answer is the bullseye to hit.

All the outer rings of how it is found and delivered are just that - outer rings. Until a brand like Sears or Kmart realize there is no bullseye for customers, they will miss the target again and again.

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Bob Phibbs, President/CEO, The Retail Doctor

The idea of in-vehicle pickup is an extension of the drive-thru concept in fast foods which has also found a home in pharmacy pickup service. It expands the choice set for consumers which means more convenience on consumers' terms. It won't be the primary way of order/pickup combination, but for specific categories and products researched ahead of the purchase (large ticket items) in-vehicle pickup will be the attractive option.

As to reorganizing a store around this concept, I can only foresee "order staging" space issues but for Sears, they usually have a pickup area already in the store, now instead of coming in to pick up, a Sears employee comes out to deliver.

There are other examples of in-vehicle pickup such as Harris Teeter with their Express Lane shopping (order online, pick up in vehicle for a fee). In France, there are dedicated drive thru formats (with limited SKUs of 7K to 10K) such as Casino Express and Intermarche's "Le Drive" Click and Collect without any service fees. Auchan, Leclerc, and Carrefour also offer "Drive" format stores. And this goes beyond grocery as seen in 2013 Holiday Season, when Selfridge's Click and Collect drive through offered similar service for luxury fashion in London.

Innovation doesn't have to come in iPhone or iPad form factor only; retailers that work to make life easier, simpler, and more convenient for their shoppers are also innovators.

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Mohamed Amer, Vice President, Global Integrated Retail Unit, SAP

It's already working for drug stores with pharmacy pickups, I see this as another shopper convenience that can work. The downside is no more impulse purchases in store, no new item browsing, etc. on those trips. I doubt it can replace, but it can augment the customer experience. If I were a pick-up-in-store retailer, I would look to add this and see if it can work for me.

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J. Peter Deeb, Managing Partner, Deeb MacDonald & Associates, L.L.C.

Is Sears still open? The stores near me have all disappeared.

Now that the shopper can insist on doing business her way, the delivery model will keep evolving. And there were a number of technology vendors pushing pick-up lockers at the NRF show. It's fun to watch.

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Cathy Hotka, Principal, Cathy Hotka & Associates

This will probably not work for Sears since they are no longer on the retail radar, and a low-volume operator. However, with a legitimate higher-volume retailer like Walmart or Target, this could have merit.

There are other retailers who have had a similar program for several years now where you order online and drive to a warehouse dock for pickup. Overall, I doubt this will catch on since it would probably be such a small, insignificant number of customers. Hard for me to imagine anyone, senior citizen, mom with young kids, etc, driving past two or three Walmarts or Targets to get to a Sears store just to have someone put something in the car. Why not just have it delivered and save the gas and trouble?

David Livingston, Principal, DJL Research

Here is my problem with all the convenience technology and the clamor for the customer is providing. Soon there will be no need for the individual to do any type exercise other than using their hands to go online and order. We are fast becoming a nation of lazy people. Sure, getting out of the car and walking in the store is not much exercise. But it beats driving to the store and blowing the horn.

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Ed Rosenbaum, CEO, The Customer Service Rainmaker, Rainmaker Solutions

Anything that makes it more convenient to shop with a retailer is probably a good feature to offer. There are store/parking layout factors that may be issues but overall, sure, the service may drive some positives for the company.

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Larry Negrich, Vice President, Marketing, nGage Labs

Who wouldn't love this service? I think it's great. Service is the final frontier of competitive differentiation.

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Ralph Jacobson, Global Consumer Products Industry Marketing Executive, IBM

It certainly will. Just as drive through windows work for fast food restaurants, banks and credit unions and other types of businesses that cater to that "on the go" customer. You will still have the other type who want to come in, walk through the aisles and see, feel and touch the merchandise.

Tom Borg, Business Expert, Tom Borg Consulting, LLC

Some evenings my husband likes to call Costco ahead and order a pizza. Would be great if they could bring the hot pizza out to the car too!

So, yes, this could be a great option for certain categories. If they are already offering buy online pickup in store then having someone walk the item out to the car would not be overburdening.

Lee Kent, Brings Retail Executives Together to Meet.Learn.Profit, RetailConnections

Store drive up is a very old approach. It first was used to reduce labor for carry-out service. Customers did not like the extra shopping step. This delivery approach was tried early on with online and telephone ordering, but was dropped due to few customers. Now Sears, the behind the curve retailer, thinks they have a new idea.

There may be one online customer segment that may find this of interest. This is the consumer who places their order at work and can quickly drive by the store to have the order placed in their car. For all others, this is an extra trip and/or shopping step. Some seniors may like the idea, but with time on their hands, shopping is time filler. This group is more likely to become online shoppers with home delivery once their driver licenses are taken way.

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W. Frank Dell II, CMC, President, Dellmart & Company

Next-day delivery, same-day delivery, in-store pickup, in-vehicle pickup... All of these are about taking care of the customer. No downside to in-vehicle pickup if Sears gets the system down.

The in-vehicle pickup does remove the customer from more positive personal interaction with the store employees, which means you potentially lose the personal connection. Maybe the very nice person who loads the merchandise into the vehicle can be the store's ambassador. The more touch-points you have with a customer, the better.

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Shep Hyken, Chief Amazement Officer, Shepard Presentations, LLC

The disconnect I am seeing here is the need to use the Shop Your Way mobile app in order to arrange for in-vehicle pickup in comparison to the two user groups mentioned by Ms. Munjal.

While a mom with young kids may be more technology savvy and willing to visit the app and input details as well as enable GPS, I have a hard time believing a great number of senior citizens will be as tech savvy or willing to share information.

This in-vehicle pickup service seems useful on a limited basis and cost to implement could be greater than benefits realized.

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Karen S. Herman, Founder & Design Director, Gustie Creative LLC

Absolutely. Buy online, pick up in store will serve as the omnichannel cornerstone for many retailers as it provides a wonderful way for single channel (online) shoppers to shop at brick and mortar locations. This is proven to lead to additional sales, and multi-channel customers are consistently more profitable than single channel.

Any way that retailers can continue to differentiate this service will serve them well. The added convenience of this will appeal to many consumers. Granted, this will require significant logistical planning for retailers. Like any new innovation, if not executed properly, retailers will risk frustrating customers more than if they didn't offer the service in the first place.

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Jesse Karp, Omnichannel Consulting Manager & Loyalty Practice Lead, Cognizant Business Consulting

I was just thinking, if I bought something online from any big box retailer, then called the store and told them I was handicapped or whatever reason for not leaving the vehicle, etc, I can't imagine any retailer refusing to carry the items out to the car for a customer. We all know Sears doesn't operate high volume stores, so the occurrence of these types of customers would probably just be a handful per week. Its probably already happening anyway at all big box stores and someone at Sears is taking credit as if it's a new idea.

David Livingston, Principal, DJL Research

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