With online shopping levels rising, one could be forgiven for thinking it will mean the death of traditional town centres. Forrester Research predicts that online retail sales in Europe will grow by 12% over the next five years to €233.9 billion by 2018 . But although growth continues, two things are putting shoppers off: high delivery costs and the inconvenience of waiting for goods.
One trend, Click & Collect - whereby consumers can buy online and then collect from a store - is successfully countering this. By blurring the boundaries between on and offline shopping, it’s achieving a win-win for everyone. Consumers like it because it’s free and convenient and retailers benefit from increased footfall. Research by IMRG suggests 40% of consumers will make another purchase when they come into a store for a click and collect order . So far from competing with high street sales, click and collect shopping is helping to regenerate local town centres and enabling smaller shops to thrive.
Although Click & Collect has made inroads everywhere, it is most advanced in the UK, where over a third of all shoppers use the service, according to research by Planet Retail in 2014. Compare this with the US, where only 13% of shoppers have tried it and Germany, with only 5% penetration .
Shoppers prefer Click & Collect because it avoids delivery costs, especially if an item is required quickly. It also eliminates the need to wait for goods, which according to Datamonitor, is a deterrent to online shopping. They report that 14% of consumers across Europe have never shopped online because of inconvenient delivery times . Just as consumers don’t like to pay for shipping, retailers want to avoid missed delivery costs, because it erodes profit margins.
What lessons can retailers introducing Click & Collect learn from the early adopters?
5 essential features of a successful Click & Collect service
Slick back office processes.
Click & Collect should be just that and not ‘Click, wait and collect’. A reliance on many time consuming and labour-intensive back office tasks will see retailers struggle to deliver the efficiency and accuracy at the front end that customers expect when they order. If a delay is inevitable, this needs to be explained, to manage customer expectations. For example, many supermarkets offer Click & Collect but do not always notify customers to expect a delay when collecting a combination of ambient, fresh and frozen items because goods are stored in different locations.
Careful ‘hidden zone’ management.
Shoppers may wish to collect from a variety of stores and having the ability to check stock availabilities within a geographical range is a convenient feature. But it requires real-time stock accuracy to avoid mistakes and wasted journeys. Ensuring the highest levels of in-store stock accuracy requires careful management of stock visibility. In particular retailers should beware the ‘hidden zone’ - the point at which goods arrive in the store. Hidden zone issues arise due to little or no proactive stock management between the time stock leaves the warehouse, its arrival in store, and the time it spends in-store prior to a sale.
Attention to detail.
Although many retailers now provide Click & Collect, few have extended the service to allow customers to choose their own collection points and collection times. For example some customers may prefer to collect from a secure locker or collection point. Offering ultra-fast options for collection times is another detail that helps to build greater satisfaction and customer loyalty. In France, one retailer, Chronodrive, operates ‘Click and Drive supermarkets’ which allow customers to purchase online and collect from a distribution warehouse within 90 minutes, without booking a time slot.
Think about up-selling opportunities.
Click & Collect increases footfall and many customers will make further purchases. Retailers should be identifying products and services that can be sold alongside collection points to complement original orders. For example, if a customer is collecting a suitcase order, they may be planning holiday travel, so offering a targeted promotion to purchase related items in store could result in further sales. Another way to generate additional revenues is through marketing partnerships. For instance, in the UK Argos allows eBay purchases to be collected from stores with its own Click & Collect orders.
This works at multiple levels and ranges from ensuring that the availability and process is clearly communicated, to ensuring collection points are clearly labelled. Sounds obvious but many retailers don’t make it obvious where the Click & Collect point is and customers are left searching for a service desk. Technology provides another way to improve communications -from providing a text messaging service to alert customers when orders are ready, to offering a dedicated Click & Collect shopping app, designed to allow customers to quickly check stock levels and reserve orders.
An efficient Click and Collect operation requires an integrated and collaborative approach, throughout the full extent of the supply chain. Since the end result is a tendency for stores to be used as fulfillment centres requiring the completion of more complex in-store processes, operations like order picking and reverse logistics / returns management are critical and need to be fast and accurate. For the customer, a good service level and the ability to ‘buy from’ and ‘return to’ any store will make the difference. An end-to-end supply chain execution optimisation specialist like Zetes can advise you on the best fit solution and technology to implement an efficient Click & Collect Service. Feel free to get in touch with us.
 Forrester Reasearch, European Online Retail Forecast: 2013 to 2018, 2014
 IMRG, Home Delivery Review, 2014
 Planet Retail, UK Click & Collect: Retail Fad or Future of the High Street?, 2014
 Datamonitor, Collection Point Strategies in European Retail: Click and Collect Innovations Driving Online Spend, 2011