Source: Bed Bath & Beyond
Will same-day deliveries be a difference maker for Bed Bath & Beyond?
Mark Tritton listed an “omni-always shopping experience” as one of the key goals when he took over the Bed Bath & Beyond (BBBY) CEO job last November. With the announcement yesterday that the retailer has added same-day delivery options, the chain appears to be moving closer to achieving that objective.
BBBY announced that it is working with Shipt and Instacart to offer customers at its namesake banner and the buybuyBaby chain the option of ordering online and having those purchases delivered on the very same day from local stores.
Customers in eligible zip codes will pay $4.99 for deliveries of orders of more than $39 at Bed Bath & Beyond and buybuy Baby. Existing Shipt subscribers will continue to get free deliveries on orders over $35 when ordering through the service. Shoppers who place orders on either bedbathbeyond.com or buybuybaby.com by Beyond+ members will be able to use their membership discounts and also apply coupons to eligible purchases.
“We’ve been delighted with the strong customer response to the introduction of BOPIS and Curbside Pickup this year, and the addition of Same Day Delivery provides another simple and cost-effective way to shop with certainty from the comfort of your own home this holiday season,” said Rafeh Masood, chief digital officer at BBBY. “So, whether you need a last-minute gift, are missing that all-purpose pan for Thanksgiving dinner, or need diapers or other home essentials right away, we will be there to help make this holiday season special.”
Earlier this month, BBBY signed a deal with Google Cloud in another effort that it said will strengthen its omni-always operations. The five-year deal, according to a company press release will enable the retailer to “further personalize the shopping experience for customers, enhance fulfilment capacity, and optimize merchandise planning and demand forecasting.”
John Hartmann, BBBY COO and president of buybuy Baby said, “The end-to-end modernization of our technology infrastructure is driving substantial digital growth and strong customer adoption of new services like Buy-Online-Pickup-In-Store (BOPIS) and Curbside Pickup.”
- Bed Bath & Beyond And buybuy Baby Launch Same Day Delivery Ahead Of The 2020 Holiday Season – Bed Bath & Beyond
- Bed Bath & Beyond Inc. Expands Google Cloud Partnership To Accelerate Its Omni-Always Transformation And Better Serve Customers – Bed Bath & Beyond
- Can Target’s chief merchandising officer turn Bed Bath & Beyond around? – RetailWire
- Bed Bath & Beyond banks on private brands – RetailWire
Discussion Questions
DISCUSSION QUESTIONS: What will it take for Bed Bath & Beyond’s omnichannel capabilities to stand out in a field where many, if not most, of its rivals offer similar services? Do you think BBBY is on the right track to turn its business around?
Poll
BrainTrust
Phil Chang
Podcast Host, Retail Influencer, Fractional CMO
Dick Seesel
Principal, Retailing In Focus LLC
This is less about standing out and more about catching-up. The “new” services Bed Bath & Beyond is announcing have become commonplace in the market and, while these aren’t new or revolutionary in any way, I think they are the right services to be rolling out. Bed Bath & Beyond is a large retailer and with size comes inertia. The changes the leadership team are making seem to be on point — now they need to execute.
Adding same-day delivery won’t harm Bed Bath & Beyond. However neither will it transform the company’s fortunes. There are still big underlying issues that the company needs to solve. Among them are finding a solid point of differentiation, investing in stores so they don’t resemble messy warehouses, and becoming more of a destination for online homewares shoppers. Ultimately retailers can add all the fulfillment services in the world – but they won’t make much difference unless the selling proposition is attuned to what customers want!
I think that different customers of Bed Bath & Beyond see the retailer from different perspectives. If you like gadgets, then going into a Bed Bath & Beyond store is like letting a kid loose in a candy store. If you “need” some right then, than same-day delivery will be attractive. Using Instacart and Shipt to fill that need is a smart move because, in so doing, Bed Bath & Beyond can avoid making a huge investment in same-day delivery for what may not be huge demand across its entire customer base.
In the case of Bed Bath & Beyond it is a me too after the fact. Bed Bath & Beyond still has other big hurdles to cross such as de-cluttering the store from too much inventory and more competitive pricing to go against Target, Kohl’s, Amazon and the like.
It could be the start of something good. All of the retailers that compete with Bed Bath & Beyond already offer some sort of BOPIS/rapid shipping, so the trick is whether Bed Bath & Beyond can draw consumers into a longer “conversation” about all the other products it carries.
It’d be amazing to see them leverage some of the success that Bed Bath & Beyond Mexico has had to help consumers in the U.S. and Canada think of Bed Bath & Beyond differently.
Bed Bath & Beyond is fighting an uphill battle for relevance and not doing a great job. There are just too many products and services they offer that are also available, most often at a lower price, at Target, Walmart and Amazon. They should compare their assortment with the big guys and delist most of the items sold in the other stores. Then they can add unique items, maybe from Pier 1 and other bankrupt retailers, to pad the selection. They aren’t going to win head-to-head – they need a flanking maneuver.
Same-day delivery is hugely over-rated.
I agree Gene. Same-day delivery from Bed Bath & Beyond is not exactly what one would call a necessity like food would be.
Do we really need same-day from Bed Bath & Beyond? I agree with the above – they are catching up but they just as easily could have not done this.
This is welcomed but brings parity for them to other retailers. The immediacy of CPG products and other household items makes more sense for same-day delivery. Don’t forget, most retailers (save maybe Amazon) still pass this cost along to the consumer so the question is, is a Bed Bath & Beyond customer willing to pay an up-charge for same-day delivery?
The more likely answer to that question is that they’ll go to Target/Walmart for those same products. The reason, to me, is that Bed Bath & Beyond still struggles from an operational standpoint and is just now stepping into the store fulfillment space (ironically they have had the technical capabilities to do this for many years).
Net, this is a day late and a dollar short. It doesn’t move the needle.
Bed Bath and & Beyond has just added a service that they needed to stay in the game. At best it may have removed a reason for someone not to shop elsewhere. People’s shopping habits are not easily changed and being this late to the same-day delivery game, getting back shoppers or getting new ones won’t be easy. My expectation is that what this will do is move some of their existing customer from BOPIS to delivery.
BOPIS, BOPAC, and same-day delivery are merely efforts to reach parity with the competitors that have been pounding Bed Bath & Beyond and walking away with their business.
Catch-up is necessary but not a sufficient strategy to stop the company’s losses and move in the direction of growth. We still get inundated with $20-off coupons which a year or two ago was supposed to be reduced. Bed Bath & Beyond needs a new playbook focused on truly new innovations or it too will be another retailer that despite small wins, erodes away to closure.
There is very little I buy at that store that needs to be delivered the same day or that I can buy without seeing it and other similar products on the shelf.
Same-day delivery may not be a game-changer for Bed Bath & Beyond but it’s clearly necessary to catch up. Mark Tritton’s prior experience at Target taught him just how much work Bed Bath & Beyond needs to do on the technology and logistics front, not to mention assortment planning and the store experience. This won’t vault the company past its competitors but it’s one piece of the formula needed to survive and thrive.
The changes they are making to enable same-day delivery are table stakes. They need to fix their in-stock positions and then play on their ability to deliver a very broad set of products in a single interaction (presumably with a single or no service fees).
For Bed Bath & Beyond’s omnichannel capabilities to stand out, the retailer will need to figure out its identity. As an outsider, it’s hard to say what the filters are for decisions around anything there. All the great brands have a reason for being, it’s unclear what Bed Bath & Beyond’s is. Their business will likely continue to get eroded from all sides as the Amazons, Targets, Walmarts and others of the world chip away at their business. They are marked for a slow death unless they really do some internal deep dives on meaning and value proposition. I hope they have, but everything seems surface level to me.
Same day delivery, in itself, is not a destination, but a marker along the road that signals to the market and customer that Bed Bath & Beyond is relevant in today’s retailing landscape. As Mark mentioned, this is about catching up and not standing out.
On the right track for sure, but differentiating? I think that opportunity passed a while ago. Now it’s catch up, which is always difficult.
I find it unlikely that Bed Bath & Beyond customers are clamoring for same-day delivery. This is a “me-too” effort that would be better spent creating an actual point of difference.
This is about catching up to the competition. Most of the big competitors of Bed Bath & Beyond already have the same-day offer. The customer expects this from major retailers. It’s good that Bed Bath & Beyond is stepping up. Now how can they make that experience even better?
Anytime we take a look at retailers’ transformational efforts, we need to ask ourselves two questions: first, is this merely achieving table stakes or does it create differentiation? Second, either way, is it likely to be material to customer outcomes (and ultimately financial performance? In this regard it is mostly about achieving parity; necessary, but not sufficient to be truly remarkable. Also, few customers are likely to need a significant percentage of the purchases they make from BB&B same-day. But it can neutralize some of Amazon, Walmart and Target’s advantages in this regard. Overall, it’s more about preserving market share/share of wallet, not gaining it.
‘Cuz you just have to have that egg timer TODAY! Maybe it’s just me (it often is) but it seems like there’s something wrong in the picture when we all acknowledge the inherent folly in something (like no/low cost delivery) yet conclude it’s a must have … and a (previously) flagging business is “turning things around” by embracing it.
So is BBBY doing the right thing? Of course!
Nothing innovative or even new here. Same day delivery for BBBY products does not meet the urgency of grocery delivery. Offering diapers or an all purpose pan are items that other online retailers already provide the same day. This latest move could in fact backfire, if BOPIS customers stopped visiting the stores, reducing BBBY’s opportunity to romance and merchandize the store and its products.
BB&B’s digital team is making the smart decisions to make them relevant for the next 5 years. They had been in a tight spot for so many years and now that delivery has become a central point for COVID-19 era customers, this is a smart place to put their focus. Note — post COVID-19, same-day delivery won’t be as valuable. But during the pandemic and with less store traffic, this is a smart move and a quick nod to a sharp digital team that’s focused on ensuring they stay relevant to their constituents.