Growing worldwide trend of online retailers shipping to local lockers
The growth of ecommerce depends upon meeting consumers' needs
In the "early days" of ecommerce (which were not so long ago), ecommerce sites quickly became more than a novelty, because they enabled consumers to comparison shop with a few clicks at home. Beyond price, the largest ecommerce sites became increasingly compelling with assortments of millions of items that could never be stocked in a retail store. And, the best of breed like Amazon wowed consumers with consumer reviews, recommendations and unparalleled convenience of shipping, tracking and service guarantees.
But, what if you don't have a credit card for purchase, or don't want to use one? No problem, Walmart, Best Buy and others are heavily promoting "buy online, pick up in store". This option creates the flexibility for consumers to see the product firsthand and pay cash if they choose. Pickup in store creates an opportunity for the retailer to promote solutions and upsell services. The pickup in store option also enables consumers to select locations that are convenient, as well as arrange a convenient time for pick up during store hours.
Three major challenges for buy online and pickup in-store
So, while buying from a retailer's online site and picking up in store enables additional consumer options, there are at least three consumer limitations/inconveniences:
- What if you don't want to buy the products offered by that retailer and prefer to purchase at an e-tailer with better price or selection?
- What if the online retailer's stores are not convenient or involve an extra trip through congested traffic?
- What if you can't get to the retailer's store before it closes?
Walmart has overcome many of these limitations by the breadth of its growing online assortment, thousands of store locations, with many of them open 24 hours. Indeed, clicks and bricks with stores open 24/7 are a major differentiator and growth opportunity for Walmart. So, how will Amazon and other online retailers compete?
Amazon is always an innovator to watch in terms of emerging trends
If you read the retail headlines, you probably already know that Amazon has been piloting pickup lockers in convenience stores like 7-11. The advantage is that consumers purchasing on Amazon can go collect their merchandise when they are ready, at almost any time. And, there are literally thousands of convenience stores, many more than Walmart locations. With 7-11, there are convenience store locations literally in your "hood" just down the street.
Much has also been written about Amazon's efforts to sell groceries online to consumers. Canned and dry goods are not such a problem. What if a consumer wants to buy fresh produce and perishables? Amazon and other online grocery sellers are providing some kind of cool storage for food. In Seattle, Amazon is providing regular Fresh customers with food "lockers" at their homes where food can be delivered and stored safely.
Lockers for online purchases is becoming a worldwide phenomenon
On my recent trip around the world, I was shocked to find that Amazon is not the only one experimenting with lockers for consumers. A grocer in Australia, Coles, was installing food lockers on the outside of their stores. For grocers and other Australian retailers feeling the heat from mass merchants like Makro (now jointly owned by Walmart), the convenience of drive up lockers for online purchases could be very compelling.
Groceries bought from your smartphone can literally be picked up at your convenience
(The Sun-Herald; August, 2012)
When a customer places an online order, the staff can literally pick the order from the store stock, place the groceries pre-sacked into the locker from the inside of the store. The lockers are built with external secure doors so that the consumer can literally drive up with their car and pick up their purchase at a time convenient for them. Not all innovation occurs in USA!
Amazon to put lockers in Staples … What's up with that?
On my recent retail through Europe, there was discussion of Amazon starting to place pickup lockers inside of Staples stores in Western Europe. Given that Amazon is a direct competitor for many products that Staples sells in store and online, why would Staples ever do that?
One of the absolute critical success factors for retail store survival today is traffic. As more consumers shop online, they are making fewer trips to stores. Yes, Staples might lose some sales to Amazon when consumers purchase from them and pick up in a Staples store locker. But, Staples is smart enough to know that they are already losing these sales anyway!
So, why not get the Amazon purchaser to pick up in your store so that you have a shot at selling services Amazon doesn't offer. And in the process, collect valuable CRM data that can be leveraged to drive Staples loyalty traffic back to Staples stores and Staples online. Bravo! Someone in retail may have finally figured out there are things consumers value beyond low price and there is actually a way to synergistically co-exist with Amazon.
Results Count … and the Consumer is the one voting
Big box retail stores are expensive to operate and require a lot of inventory. Best Buy and even Walmart are aggressively building smaller footprint stores that are more cost effective. These smaller stores can be located in neighborhoods, because they don't require massive real estate. Consumers appear to be increasingly willing to shop online, but want or need to pick up items at a convenient location. In many ways, it's like the old catalog store is being reinvented all over again with the twist of almost unlimited assortment delivered to your locker.
It's too late to put the genie back in the bottle. The consumer has been empowered and you are not going back. The newest trend in retail is "omni-channel"… you shop where and how you want to shop. Your preferred store might just become the one that can deliver an unlimited choice of products at a great value to that pickup locker you choose.
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Source:
- Retail Locker Photo: The Sun-Herald: Sunday August, 19th, 2012
- eCommerce Image: www.sxc.hu
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