Delivery Where You Want It: Convenient Collection Points For Delivery
by Justin Prostebby
July 14, 2020
We’re all aware that online shopping has been growing in popularity since the start of the internet. In recent years it’s become increasingly clear that eCommerce is being adopted at unprecedented rates.
According to Forrester, online sales will account for 17 percent of all U.S. retail sales by 2022. Additionally, online sales are projected to grow five times faster than offline sales. These figures should come as no surprise considering 80 percent of Americans now shop online and 62 percent of them make online purchases every week.
There are many benefits that go along with — and likely encourage — this shift online: convenience, saving time, bargain hunting, etc. However, even with these benefits and the obvious surge of adoption, online shopping is not without its drawbacks for both consumers and merchants.
Most of the drawbacks for consumers are related to the actual delivery and receiving of purchased goods. Online purchases delivered to your home or office can succumb to any number of unintended fates: packages left outside or in an apartment lobby are often stolen, or otherwise misplaced. Delivery times can be unpredictable, so deliveries requiring a signature from the recipient can result in confusion over where the package is, along with an unplanned trip to the post office. And in more extreme cases, the package is returned to sender. It can also be difficult for delivery drivers to gain access to some destinations, resulting in similar outcomes.
The Rise of BOPIS
BOPIS (Buy Online, Pick-Up In-Store) is exactly as it sounds. Shoppers make purchases online, then visit a brick-and-mortar location to pick up their goods. While merchant support for BOPIS eliminates the difficulties that sometimes occur with delivery, it’s not a perfect solution — though it is a step in the right direction. Many consumers excited to pick up their purchases are met with confusion over where their order could be retrieved — ultimately ending up at the customer service desk. While promising, oftentimes online shoppers end up waiting in line behind in-stores customers, which result in long wait times and frustration.
The Kibo 2018 Consumer Trends Study shows nearly 80 percent of shoppers have picked up web orders in a store, and half are willing to remain loyal to brands who offer it. So part of the retail revolution must include accommodating BOPIS. Streamlining the customer pick-up process with automated lockers has been proven to increase satisfaction and often leads to additional in-store purchases while the customer is picking up their order.
The latest trend — and one we believe will continue to grow in support and adoption — is the collection, or pickup locker. Again, this is just as it sounds: make purchases online, arrive at their local store for pickup, and retrieve their items from a locker, rather than a customer service desk. The process, though with slight variations across retailers, is simple and straightforward. Collection lockers are generally at or near the front door. The customer enters a code, or scans a QR/barcode from their phone. The locker door opens and items are retrieved. The customer carries on with their day. Pickup lockers are safe, secure, and convenient. Most can also be used for returns.
The Last Mile Challenge
Online shopping with delivery has created a logistical challenge for most retailers. Typically referred to as the “last mile” — or getting products from a retail location to the customer’s delivery destination — is a complicated and costly undertaking for most merchants. They find themselves needing the infrastructure to support the organization of purchases, deliveries, returns, carrier accounts, and everything else that goes along with the shipping business — a business many never intended to get involved with. Pick-up lockers not only reduce or entirely eliminate the time and cost associated with the last mile, they’ve also been shown to improve customer engagement, satisfaction, and additional purchase rates.
With clear benefits on both sides of the online shopping experience, we’re seeing growing adoption across many industries and verticals. This includes large retailers like Walmart and Home Depot, eCommerce giants like Amazon, carriers like FedEx and UPS — as well as many retailers in beauty, apparel, and grocery.
|Example of BOPIS in Major Retailers Today|
|Home Depot Pick-Up Lockers - “Lockers are located just inside the entrance so you don’t have to look far to find them. Accessing them is easy and they don’t require any assistance from any employees as it’s completely self-serve and help is available from a human in case you need.”|
|Walmart Click and Collect Pick-Up Solution - “By the end of 2019, there will be around 1600 Pickup Towers installed in the States. Walmart has also installed the Pickup Towers in a few of their shops in Canada.”|
|Kroger Package Services - “A package pickup and delivery service, aptly named Kroger Package Services, is also being tested in partnership with FedEx, UPS, and the U.S. Postal Service, in 220 of Kroger’s stores across the country.”|
|Ship, Pick-Up, and Returns - FedEx and Walgreens announced that FedEx package pickup and drop-off services are available at 7,500+ Walgreens in all 50 U.S. states. They have expanded to Dollar General, Albertsons, Kroger, Shaws, Star Market and Vons too.|
|UPS Access Point - UPS Access Point locations are participating businesses in your neighborhood that offer a secure location to receive packages. They are an ideal delivery option for customers not at home to receive packages during standard delivery hours.|
Many retailers are now offering BOPIS options as a way of providing secure, relatively inexpensive, and convenient ways for online shoppers to retrieve their purchases.
An increasing number of retailers that have both an online and brick-and-mortar presence are offering their customers the flexibility of BOPIS. According to research by RetailMeNot, 60% of retailers planned to provide these options this holiday season, compared with 52% in 2018.
Retailers with an online shopping experience have often found themselves in the position of solving the “last mile” problem - how to get online purchases to their customers’ final destination. These solutions are typically time consuming and costly for merchants and have created some unexpected challenges for customers as they often need to sign for deliveries, be present to provide access to secure locations, or find their packages stolen or misplaced after delivery.
Retailers have supported various BOPIS options over the last number of years, but one gaining in popularity is the automated pickup locker. Customers’ online purchases are placed in an onsite locker and access is gained by either entering a code or scanning a QR/barcode. This keeps items secure, allows customers to retrieve them on their schedule, and has provided merchants with additional benefits such as cost reduction and an increase of in-store purchases made at the time of pickup.
- Global News Wire (2020)
- Digital Commerce 360 (2019)
- Skupin (2019)
- Javier (2019)
- Cleveron (2020)
- Produce Blueprints (2020)
- Johnsen (2017)
- FedEx (2020)
- UPS (2020)
Justin Prostebby has a long history in product, with his focus most recently on all things logistics, supply chain and e-commerce. He's got an eclectic background that includes founding his own startup, working in the gaming industry and delivering products in the marketing automation space. If he's not working, he's probably out surfing.