In-store pickup offers opportunities, but beware of pitfalls, says Jupiter
Only 9% of online shoppers have ever picked up in-store an item purchased online, according to new findings from Jupiter Research Inc., largely due to the fact that in-store pick-up isn’t yet widely available. But that’s changing fast.
“A growing number of retailers are evaluating the costs and benefits of in-store pick-up of online orders,” says Jupiter. Successful implementation of this “last mile” option will require close cooperation of the retailer’s online and store channels, taking into account store employees, the physical location of pick-ups areas in the store, and fulfillment speed and accuracy.
With retailers initially unable to justify added investment in processes for the in-store pickup of online purchases, they’ll have to use existing resources and staff, says Jupiter. This makes the performance of store employees critical and requires both incentives and training as well as reprimands for poor performance. “Store employees responsible for execution of in-store pickup must be directly compensated or disciplined for its success or failure,” Jupiter says.
Retailers should set clear goals for the speed and accuracy of order fulfillment. Jupiter reports that 60% of Circuit City store-pickup orders were picked up the same day, with 6% of customers arriving at the store within 30 minutes. In response, Circuit City now requires that online orders be ready for customer pickup within 15 minutes.
Jupiter also found that the location of the pickup area within a store can boost incremental sales. Sears, for example, has reported that 20% of customers who pick up an online order in-store make additional purchases while in the store. “To the extent possible, pickup areas should be located to guide customers past merchandise suited for impulse purchasing,” says Jupiter. However, retailers pursuing a renovation or building new stores should also consider a drive-through window for online order pickup, says Jupiter: while it limits cross-selling potential, the convenience broadens the retailer’s appeal.
“To ensure that technology integration efforts aren’t wasted, online retailers must collaborate with their brick-and-mortar counterparts, “ Jupiter says. “They must enforce standards governing the last mile of service: the customer pick-up.”
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