Constilation

How the 'Click and Collect' Model Changed the Retail Industry

Author
Björn Ström
June 1, 2021

The "click and collect" retail model is here to stay, especially after seeing a boom throughout the COVID-19 pandemic.

It continues to change the retail industry, even nearly a decade after the concept was first introduced. This already-popular buying method more than doubled in 2020. Click and collect is also expected to have double-digit growth rates through 2024.

The click and collect process provides a great way for customers to conduct product research online and get the instant gratification of getting an item right away—often within hours of finding what they want on a website.

What is Click and Collect?

Click and collect allows shoppers to purchase items online and go to a local store to pick up their purchases. There are no shipping costs, and customers can pick up their item from customer service, a locker, or another pickup location. Some retailers even use affiliated stores with local pickup points when there is no brick-and-mortar location in a customer's area.

They can also use a "ship to store" option, which pulls a product from a store that is further away and makes it available locally.

This concept, also known as buy online, pick up in-store (BOPIS), merges the brick and mortar store and eCommerce. It allows customers the ultimate level of convenience. They can shop online and purchase on their own time and then make arrangements to pick up their item whenever is most convenient for them.

In 2021, in part due to the COVID-19 pandemic, click and collect is expected to account for just under 10% of all eCommerce sales—generating $83.47 billion in sales.

Changing the Face of Ecommerce

Click and collect sales growth is outpacing eCommerce growth. It is also taking up more and more of the total eCommerce "pie." In 2020, BOPIS sales made up nearly 18% of all eCommerce sales.

The concept works well for brick and mortar stores that have been forced to find ways to compete with retailers that are entirely online, including Amazon. However, Amazon also offers its own version of click and collect sales. They now have Amazon lockers that can be found in thousands of locations across the country.

Increasing In-Store Impulse Buys

Interestingly, click and collect is also increasing sales in another way. When the customer comes to the store to pick up their purchase, they are also often impulse buying in the store—further increasing sales numbers.

In a survey done by ICSC, even back in 2016, they found that nearly 70% of shoppers were not only using the click and collect sales method, but they were also making those impulse buys in-store while going to pick up their items.

Altering the Retail Environment for Click and Collect Sales

Due to the significant increase in click and collect sales, retailers are in a situation where they often feel forced to implement this technology. Failing to have a click and collect option means ignoring a huge segment of the market, especially when it comes to eCommerce.

Creating the right environment for click and collect sales, however, often means a fundamental change in how retailers must function. If it is not done correctly, retailers may notice a drop in customer loyalty.

Keeping Up with Inventory and Availability

Having the right inventory when you need it can be a huge challenge for brick-and-mortar businesses that are implementing a click and collect program.

The worst possible situation is telling a customer that a business has an item in stock when it is not actually available for pick up. In that type of situation, the customer comes to the store to pick up the item, only to find out that it is not there. Those circumstances take virtually every benefit of the system away from the customer.

The same concerns can be applied to the service industry as well. Promising a customer an available barber chair at a certain time, for example, must be met if you want the customer to return.

Stores may also struggle to ensure that they have the full availability of inventory listed online. If a company cannot keep up with listing new products online, then they have the opposite issue—the customer cannot see the full range of offerings on their website, which can hinder sales.

To address these concerns, retail spaces are turning to newer, faster technology that helps them track and review inventory compared to sales in real-time.

Pick Up Locations and Logistics

The purpose of buying online and picking up in-store is often based on ease of access and convenience. When a consumer is taking advantage of this service, the last thing they want is to get to the store to wait in line. Waiting to get an item is never convenient.

Solutions like creating pickup "locker" systems or specific areas where products are held have worked well if the retailer can create the space for that type of system. Pickup towers at Wal-Mart and even separate pickup locations (such as behind the store or in the parking lot) can work well in some circumstances, too. At a minimum, retailers need signage so that customers are clear on where they need to go to pick up their items.

Curbside pickup options often work well for those that do not have the space to create an in-store pickup system. Further, many consumers enjoy the added benefit of not having to leave their vehicle to get the product they ordered.

Employees and Staffing

Retailers must now also engage employees to pick up products from their shelves, package them (if necessary), and move them to a pickup location. In some situations, this type of movement can be as simple as asking a current cashier to run to the floor to bring a product to customer service. However, when items need to pick up on a larger scale, the demand for workers can be a bit overwhelming.

Holiday periods are particularly challenging, as many stores see a sharp increase in click and collect sales over Christmas, Valentine's day, and other major holidays.

Adjusting to the Changing Landscape of Retail

With the right technology, retailers can take full advantage of the click and collect concept and keep up with changes to the retail environment that are definitely here to stay.

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