Are retailers getting comfy with click & collect?

Discussion
Photo: Jersey Mike's Subs
Sep 21, 2017
Nikki Baird

Through a special arrangement, what follows is a summary of an article from Retail Paradox, RSR Research’s weekly analysis on emerging issues facing retailers, presented here for discussion.

During a panel at the CONNECT Mobile CX Summit in Philadelphia, panelists from Jersey Mike’s, Kohl’s and Brookstone (formerly Advance Auto Parts) all talked about unintended consequences from their early efforts at click & collect.

Issues include dealing with customers showing up at the wrong store because they didn’t realize where they’d actually placed the order. Another challenge, according to the panelists, is making sure a promotion to get people used to ordering online for in-store pickup actually has the scale in stores to support possible over-sized success.

Not surprisingly, the importance of mobile was also talked up at the conference. Once a click & collect order is in flight, most consumers rely on mobile for further communications and updates from the retailer. At the store, employee-facing mobile is becoming more important as retailers are finding manual processes breaking down in the face of all that volume.

All three panelists emphasized the importance of getting on the learning curve — of throwing something out there, learning a lot and rapidly iterating on the process and the technology to support click & collect. All agreed that retailers will never think of everything they need to consider out of the box and also that the worst thing they can do is promise a great experience and then take too long to iterate on that experience until it truly is great.

The one thing retailers can count on is that, no matter how much up-front effort they put into it, they won’t get it right the first time.

There were a lot of other lessons to be learned from click & collect related to being able to capitalize on the in-store opportunity and also the need to evolve the process as volume moves from single digits to double digits. Regardless of the lessons still to be learned, the panel’s conclusion was fairly simple: click & collect has become a baseline expectation among consumers. Stores need to be prepared.

DISCUSSION QUESTIONS: What do you think are the most and least obvious challenges for retailers in embracing click & collect? What complexities are added by efforts to capitalize on in-store add-on purchases?

Braintrust
"When introducing click and collect, one obvious challenge is to ensure you communicate the right message."
"I have already said what I know for my store, and that is it won’t work, as structurally we are not prepared for this."
"...picking up a click and collect parcel often means waiting in the same queues for the same tills; hardly a timesaver."

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16 Comments on "Are retailers getting comfy with click & collect?"

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Neil Saunders
BrainTrust

A big challenge can be coping with the volumes of click and collect, especially in stores where it is popular and during peak periods like the holiday season. This can necessitate more backroom space, staff changes and sometimes a reconfiguration of store layouts. Grocery is a particular challenge here due to the logistical and time challenges of assembling the order.

The other issue is stock. If stock is picked from the shop floor rather than from a central warehouse and sent out to a store, this can change the order level requirements and reduce availability. Obviously this can be managed over time, but it makes assessing and managing demand more challenging.

Phil Chang
BrainTrust

Marketing and logistics are the two areas in which I’ve seen retailers struggle. I have faith that a store can execute almost anything they can dream up — retailers small or big are adaptable this way.

In marketing, being able to make the breakthrough to get the benefits of click and collect (however obvious) is difficult. While there is a baseline of consumers that want this service, it’s still in the infant stages. I also think marketing will have to learn from merchandisers how to create a bigger-basket purchase online (there’s no end cap for them to “walk by” … is there?).

In logistics, be prepared for the flood gates. Right now, a half-dozen pickup spots or one or two lanes for pickup are sufficient. What happens when this gets mainstream adoption? Retailers will need to be quick about figuring out where to steal space from in-store to ensure they have the right amount of space for pickups when that happens.

Bob Phibbs
BrainTrust

And at that point, when they are looking to steal space, it is no longer a store, it will only be a warehouse which will never justify the real estate costs.

Sunny Kumar
BrainTrust

When introducing click and collect, one obvious challenge is to ensure you communicate the right message. Is it “pay online and collect in-store” or “reserve online and pay in-store?” This is nothing that a well designed checkout journey can’t handle but it is an important business consideration.

A less obvious challenge might be the returns policy. This may be more obvious for the consumer. If they want to return something, they’ll take it back to the store they picked it up from. The business needs to be ready for this type of user journey.

Meaghan Brophy
BrainTrust

I think the hardest part of click and collect for retailers is having the mobile capabilities to satisfy shoppers who only want to communicate on that channel, and having that seamlessly integrate with the pickup experience. If the communication isn’t clear, or if the technology doesn’t live up to shoppers’ expectations, customers won’t even consider buying anything else once they get in-store.

Dave Bruno
BrainTrust

While logistics challenges surrounding click and collect are numerous, they are not insurmountable. I hope that retailers will soon focus on the opportunities inherent in click and collect and when they attempt to tackle the logistical challenges that they will do so with an eye toward maximizing the opportunity to engage. Click and collect is critical to keeping the store relevant, and I believe the process is ripe for creative opportunities to build loyalty.

Adrian Weidmann
BrainTrust

While click and collect is growing in popularity, particularly in the QSR and fast-casual restaurant sectors, the process is fraught with challenges. As noted, the right answer is to innovate, implement, measure, iterate and keep optimizing until the process works and shoppers become delighted customers. It is imperative that you cannot forget about the in-store experience or you’ll the risk of simply becoming a drive-thru window for Amazon.

Roy White
BrainTrust

Online versus digital selling are two completely different worlds, so it’s no surprise early efforts have problems built in. The long-term question is how the two businesses can be integrated and become mutually supporting. One of the biggest questions here is what metrics can be used to tell us how digital operations are performing or will perform, compared to what all brick-and-mortar merchants have used for decades. What is digital success and how and with what markers can it be predicted? A new mindset is required, and the likes of Amazon and other online sellers have an advantage here. They have grown up thinking digitally, while brick-and-mortar merchants must shed prior ways of thinking and learn new. Indeed it begins with what factors shape predictions of performance, an issue for the panelist apparently.

Mohamed Amer
BrainTrust
One obvious thing is store inventory management, from having accurate on-hand numbers to presenting a consistent picture across the various systems. Related to that, the store employee should not be the accuracy back stop in the process. I had a recent click-and-collect experience where the order went through fine and 30 minutes later I received a call from the store stating that the items I ordered were seasonal and the store had been out of stock for a while. A less obvious challenge is that this is not a bolt-on process but a new way in how the customer wants to interact with the retailer. Having the customer as the driver of a cross-system process is disruptive to existing well-honed processes. This is further aggravated when the customer wants to interact via mobile — from order updates, to updates, check-in/out, and payment. It’s easy to underestimate the organizational challenges and the need for clear cut responsibilities and crystal clear communications. It’s like having to communicate in a new language and not just a dialect of an existing one without the benefit of a face-to-face conversation. The right time to pursue add-on purchases would be while the customer is shopping online.… Read more »
Adam Silverman
BrainTrust
The most obvious challenges are exposing inventory visibility and allowing the sale to occur online for an in-store item. The industry has been tackling this for five or so years (more in the case of leading retailers) and for the most part this is understood. The execution of click and collect, as the article states, is where the rubber hits the road. There are four areas that need focus: Customer order and pickup experience — providing stellar progress communication and an easy to follow processes once the customer arrives in the store, and ensuring that the speed of service is faster than if you were to just come into the store to purchase the item off the shelf. Associate execution experience — This is one of the biggest pain points in the process. Associates need to have clear expectations on customer arrival times (why not have the customer indicate when they are going to arrive?), processes for moving product to a staging area for fast retrieval and quick notifications when new orders come in and when customers actually arrive. The tool set here needs to be agile and on demand. Product productivity — Retailers need to employ personalization technologies found… Read more »
Lee Peterson
BrainTrust

In three different studies we’ve done over the last five years, BOPIS ranked as a top element customers expected from retailers. But in followup qualitative work, they also outlined how poorly retailers were executing this critical piece of the store of the future. Customers wanted to pull up and have the retailer put the goods in their trunk, but no one other than Walmart was doing that, and even Walmart is just now getting around to it.

And why is that? Because more retailers are stuck in the ops world of the ’90s. How does it best work for us vs. the customer? Those days are over. The panelists are right, you’re going to have to fail fast. But some fundamentals, like customer expectations, cannot be overlooked. For the best example, see Amazon’s “Fresh” concept. They nailed it.

Ralph Jacobson
BrainTrust

All of this has to do with the implementation of effective in-store processes. All the best technologies in the world cannot guarantee a seamless shopping experience for the customer if in-store messaging is ineffective, if in-store staff are not properly trained and/or if in-store upsell promotions are not executed. In this digital age, we rely too much upon technology when critical physical business processes have not been optimized.

Herb Sorensen
BrainTrust

I don’t see click and collect going anywhere significant. 1% or 2% seems about right. The problem is that there is ZERO serious consideration that bricks is built on pallet delivery from the warehouse to the store “warehouse,” and unpaid, “free” stock pickers, aka “shoppers” doing the hard final mile work, beginning at MASSIVE store shelves.

So how is your store going to compete, by providing a PAID stock picker (store) staff, to fetch and deliver to drive up, when Amazon is relying on robots/automation for the largest part of that process?

The fact that the industry is nuts about THIS problem is proven by Walmart’s wackadoodle idea to have employees make deliveries to shoppers on their way’s home from work. The industry is going to make ZERO progress here until they at least acknowledge what the problem is.

Tony Orlando
BrainTrust

I have already said what I know for my store, and that is it won’t work, as structurally we are not prepared for this. I will continue to move forward on our online, email, or phone in orders for meat, deli/bakery, and catering orders, which we can have ready same day or whenever they want to pick this up, which includes paying online ahead for it, if they choose. Stores built in the 1960s would need to invest quite heavily in redoing the stores, adding coolers, and more technology, and it must be tested slowly to make it right. What is the ROI? Not sure, but for now I’ll keep taking the items I can work with, and make sure we are right every single time.

Cate Trotter
BrainTrust
I think most shoppers expect click and collect to be an option these days. If you want something the same day, being able to check it’s in-stock, reserve it and collect in-store is a very attractive offer. Click and collect is often a cheaper or free delivery option as well, so customers who can afford to wait for purchases and live/work/pass by a convenient store benefit too. The challenges are much the same as those that retail has anyway — picking up a click and collect parcel often means waiting in the same queues for the same tills; hardly a timesaver. People expect to be able to walk in and walk out quickly with their BOPIS purchases. Better communication with customers about where to get their parcel, and better information for staff is also important. This is why things like Doddle are so interesting as it serves as a click and collect option for many stores, has dedicated desks located in footfall hotspots, customers don’t have to queue with regular shoppers and in some cases can try on their purchases in the attached fitting rooms. I’d be interested to see a retailer putting as much effort into their in-store click… Read more »
Harley Feldman
BrainTrust

Click and collect will be the major way for consumers to buy in the future. Millennials are already there as they have been buying on their phones using Amazon, Google.or direct to the retailer for a long time. Since Amazon delivers from their huge warehouses, and they are almost never out of stock, a retailer needs to deliver the same type of service.

The most obvious challenge is to create a website with a product catalog and the ability to order — Click. The least obvious challenge is to fulfill the order — Collect. If the fulfillment problem can be solved to have the item available in the store to collect when the customer arrives, add-on purchases should be straight forward. The challenge for the retailer is to make in-store fulfillment work every time to meet the expectations of today’s consumers.

wpDiscuz
Braintrust
"When introducing click and collect, one obvious challenge is to ensure you communicate the right message."
"I have already said what I know for my store, and that is it won’t work, as structurally we are not prepared for this."
"...picking up a click and collect parcel often means waiting in the same queues for the same tills; hardly a timesaver."

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