E-commerce grew 20% for Costco in fiscal 2015—20 times faster than store sales.
Rather than miss deliveries at home, they go to the store to pick up orders.
What in the U.S. is typically called order online, pick up in store, goes by the snappier name click & collect in the United Kingdom. And U.K. consumers increasingly are choosing the option of picking up online orders in stores, instead of waiting for home deliveries that might not show up.
Last year, several heavy snowstorms contributed to US$1.237 billion worth of bungled online deliveries, according to IMRG, a U.K. trade group for online retailers. That may help explain why U.K. consumers now pick up in stores about one in 10 online orders.
“It’s really about providing the consumer with as much choice as possible,” says Andy Mulcahy, communications manager at the IMRG. Severe weather, like last year’s snowfalls, “can be massively disruptive to the delivery of online orders,” he says. “Again C&C provides that level of control that consumers want.”
In the past year, John Lewis Plc says click & collect business has doubled at its 28 department stores, growing at twice the rate of online sales and representing 20% of online orders.
The retailer, which also owns the 94 Waitrose supermarkets, plans to expand its click & collect offering to mobile shoppers with what it calls “virtual stores.” Until the end of December, passersby can scan QR codes of goods on display at Waitrose’s Brighton store, purchase them on JohnLewis.com, and collect the following day. QR codes are two-dimensional bar codes that can connect through a smartphone app to online content, such as product pages or videos.
80% of Waitrose products are available for click & collect. “This new 24-hour virtual shop takes that convenience to another level,” says Craig Inglis, group marketing director at John Lewis, No. 21 in the Europe Top 300 Guide.
Dixons electronic stores have seen a 13% sales increase in sales ordered online for store pickup, while the e-commerce team of the U.K.’s biggest supermarket chain, Tesco Stores, has been piloting drive-through supermarkets for the increasing number of shoppers who prefer to collect.
For a fee of 2 pounds ($US3.13) for picking and packing, customers get to choose from two-hour slots, seven days a week. The service is expected to win over busy mothers and professionals who cannot lose time waiting for home deliveries, says Laura Wade-Gery, CEO of Tesco dotcom and Tesco Direct. “They can collect their shopping on the way home from work or at any other time that suits them during our extensive collection hours," she says. Tesco is No. 3 in the Europe Top 300 and Dixons Stores Group No. 10.
Other U.K. retailers are also getting in on the click & collect trend. Department store chain Argos is offering “immediate collection” on 15,000 of its household, toy and office products. Marks & Spencer meanwhile has swept in ”food to order” for Christmas and New Year party food, plus click & collect dining for 100 takeaway items from its food hall.
Retailers are adapting to consumer desire for convenient pickup at a time when the web is accounting for a growing share of retail sales. “We expect the internet to account for around 20% of all U.K. Christmas shopping this year,” says IMRG CEO James Roper.
Despite a forecast of zero growth in overall retail for this year’s holiday season in the U.K., Britain’s 37 million online shoppers are expected to generate a 15% hike in web retail sales, backed by a continued rise in click & collect and use of mobile gadgets, says Ian Geddes, head of retail at consulting firm Deloitte U.K. By 2015, the U.K. Centre for Retail Research predicts 50% of Christmas shopping will be conducted online.