Sam’s says it’s scoring with club pickup

Discussion
Jamie Ianone, President and CEO, Samsclub.com - Photo courtesy of James Tenser
Mar 29, 2017
James Tenser

Club Pickup — the Sam’s Club version of click-and-collect fulfillment — is gaining traction with business customers and is poised for growth, said Jamie Iannone, president and CEO of Samsclub.com.

Sam’s has the Club Pickup service available in stores chain-wide. Speaking at last week’s Shoptalk conference in Las Vegas, Mr. Iannone said the company has installed drive-through pickup lanes in 60 stores so far, with plans to have them in 100 by year-end.

Curb-side pickups are nothing new for Sam’s, Mr. Iannone explained. “We’ve been doing this for more than 15 years. It began with fax-in ordering.”

The latest wrinkles are a streamlined pickup lane adjacent to the store entrance, full-assortment online ordering and a highly-functional mobile app, he said. The app enables customers to place orders, set pickup times, check out transactions and save shopping lists for future reuse. A prototype in a Bentonville-area store features multiple slots for cars to pull through.

The innovations add up to a service encounter that can be as brief as 30 seconds, said Mr. Iannone. Timing is crucial for both convenience and product quality. “Almost half of our orders have fresh and frozen included.”

To be fully successful for members with standing reorders, Club Pickup depends on an e-commerce engine that reportedly has near-perfect in-store inventory accuracy. “All SKUs have to be online, whether bought digitally or in the club. It’s part of the online experience.”

For business customers, Mr. Iannone said, “Complete orders are paramount. Restaurant customers require that.”

Mr. Iannone said Sam’s has reduced friction of in-store encounters too with its Scan & Go self-checkout app, now operational in all 659 stores nationwide.

“We built Scan & Go because checkout is a pain point for members. It takes the line wait away and helps drive more frequent sales and more items.” The app pops up on the user’s mobile device screen so that membership cards are no longer necessary.

Net promoter scores (a measure of shopper satisfaction) for Scan & Go are “way off the roof,” he said.

Sam’s has been testing business delivery from stores in a couple of markets, an experiment that also has yielded very strong NPS scores. 

DISCUSSION QUESTIONS: How much of an advantage does Sam’s Club gain from incorporating digital tech in services such as click-and-collect fulfillment and Scan & Go? Which is more significant, Club Pickup or Scan & Go? How important will local store delivery become?

Braintrust
"The warehouse retail business is ideally suited for click-and-collect."
"Sam’s Club Pickup is just what the business customer wants. The owner can order and pay online and send an associate to pick up. "
"This will make Sam’s an even more formidable challenge for wholesalers who supply small businesses."

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12 Comments on "Sam’s says it’s scoring with club pickup"

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Charles Dimov
BrainTrust

Sam’s Club doing pickup is a no brainer! Costco has not yet started any heavy foray into omnichannel — so, advantage Sam’s. For many customers, thinking of going to a big box warehouse retailer is a bit of a hassle. Mid-week, no problem. But try your luck on a weekend and it can be a crowded zoo. Going the click-and-collect route makes sense for many customers. The warehouse retail business is ideally suited for click-and-collect. It helps Sam’s cater to another group of customers who don’t like the lineup and hustle and bustle. And clearly with NPS scores “off the roof” it is paying off. I am expecting to hear big things from this early start for Sam’s!

W. Frank Dell II
BrainTrust

Sam’s Club Pickup is just what the business customer wants. The owner can order and pay online and send an associate to pick up. Most business customer are not on treasure hunt shopping trips. This saves the business customer time. Sam’s doesn’t have to train an employee to walk the store. Merchandise is available any time of the work day, reducing their business inventory.

Frank Riso
BrainTrust

Sam’s has a lot to gain from innovations such as click-and-collect and Scan & Go. Many of their small business owners who use Sam’s as a primary supplier are not only the owners of their business, but the primary worker in their business. They cannot afford to be away from their business for even the amount of time it takes to shop at the club. So these innovations do help a great deal. I do think that click-and-collect is the better of the two for the same reason — it saves time, and to a small c-store operator saving time is more time at the store and hopefully more sales.

Ricardo Belmar
BrainTrust

Sam’s Club Pickup service is exactly what business customers want. Consumers will also appreciate this as it saves them time from wandering through the warehouse. However, I believe the Scan & Go service has greater potential. The warehouse model is fairly dependent on impulse buys as customers wander the store but as most shoppers know, doing this on a weekend can be a madhouse! Anything that streamlines that experience in a near Amazon Go-like fashion, in which the checkout process is all but eliminated, is destined to be a real winner!

Steve Montgomery
BrainTrust

This will make Sam’s an even more formidable challenge for wholesalers who supply small businesses. One of the downsides of using Sam’s as a supplier was the time it took to shop. The checkout process meant taking all the items off the cart, having them scanned and then reloading the cart.

The Pickup process will save a significant amount of the time taken at the store level. The order saving feature will allow the retailers to create a shopping list and quickly select what they need for each trip.

Tom Redd
Guest

Go Sam’s. Costco will follow — I am sure — very soon. They did not have a car wash first, but did their homework and now have a great car wash that even Scottsdale, AZ car owners use. “Take the Jag to Costco and make sure to get a wash!”

Kelly Coughlin
Guest

This is consistent with Doug McMillon’s commitment to not only save customers money, but time as well. The company’s logistics are able to support these options, and we will be seeing more agility in catering to customers moving forward as the company aims to stay competitive.

Guy Mucklow
Guest
Guy Mucklow
President and Co-Founder, PCA Predict
8 months 16 days ago
Sam’s Club has taken the lead in leveraging digital technology to enhance their customers’ experiences—especially important given consumer demand for fast and easy shopping experiences both in stores and online. While the Scan & Go capability will appease many customers shopping in Sam’s Club stores, it is the Club Pickup and local store delivery options that will have the biggest impact on the customer experience and brand loyalty. Looking at online shopping trends across the retail industry, it is clear that customers are increasingly choosing delivery and pickup methods over in-store purchasing. So why should grocery shopping be any different? When it comes to online shopping, the fulfillment process is key. What customers will remember is if their order was ready or delivered on time and if the delivery was error-free. In order to truly appease customers, Sam’s Club will have to ensure both of these features are as streamlined as possible. If Sam’s Club continues to implement advanced technology, they will have no problem perfecting the fulfillment process. Technology such as address verification will… Read more »
James Tenser
BrainTrust

Needless to say, I was favorably impressed by Mr. Ianone’s discussion about Club Pickup. It makes sense to design service experiences for high-value business customers. I’ve been a loyal Costco member for many years, but I’m heading over to our local Sam’s this afternoon to see their process in action.

Doug Fleener
Guest

Extremely smart. I’d be interested to know how much incremental business is generated by the click-and-collect, and the impact of the additional labor costs on such low margin items. Clearly it works with them expanding the number of stores doing it.

Stefan Weitz
BrainTrust

This just makes so much sense. Already 55% of Walmart shoppers prefer in-store pickup to shipping the product — both for convenience and cost. Pushing this to Sam’s Club and offering a seamless way to pick up (remember my mantra — always look to reduce friction) is a winning strategy. In fact, you can see Amazon copying it with their new Amazon Grocery service.

Kai Clarke
BrainTrust

This is a “concierge service” which might be a profitable segment with some of Sam’s club offerings, but it has to have an impact on costs. The entire club model is built upon a choose your own, browse the aisle, extra-large size, super discounted, product offerings. This seems to go against this model. I doubt it will be successful in all clubs in the longer term.

wpDiscuz
Braintrust
"The warehouse retail business is ideally suited for click-and-collect."
"Sam’s Club Pickup is just what the business customer wants. The owner can order and pay online and send an associate to pick up. "
"This will make Sam’s an even more formidable challenge for wholesalers who supply small businesses."

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