‘BOPIS’, the latest survival tool for Brick-and-Mortar Stores
The most prominent retail trend in the past few years is the rise of omni-channel shopping, where consumers no longer distinguish between buying in a store and buying online. While brick-and-mortar stores continue to be threatened by online shopping, even
The most prominent retail trend in the past few years is the rise of omni-channel shopping, where consumers no longer distinguish between buying in a store and buying online.
By integrating online and physical shopping stores, for whom many retail analysts had predicted doom with the advent of digital convenience, this has emerged as an asset rather than a liability. The new retail ‘mantra’ has not only impacted the physical stores, but also posed a challenge for companies that sell entirely online, compelling them to shift strategy, in response to consumer desire for more flexible shopping options. The phenomenon, pioneered by Walmart and Best Buy about seven years ago, is now being adopted across the industry. “It’s huge,” says Lee Peterson, Executive Vice President with retail consultant WD Partners Inc, adding, “It’s a big part of e-commerce for retailers going forward, and a great way to compete with the online invasion…”
Many of these changes will affect the way retailers manage their supply chains. Brands that understand both the power of digital and human psychology will be the winners, as they see digital as a means, not an end. These smart retailers/brands are adopting their business models and integrating themselves deeply into the customer experience, so they are there wherever you need them, whether it is lying in bed or walking down the street – that is what many analysts are calling ‘The Blur’. In, The Blur, the dichotomy of online and offline no longer exists, because the physical world is augmented and enhanced by digital capabilities. In-store pickup is helpful to brickand-mortar retailers in a number of ways. In a recent study by JDA (JDA Software is the leading supply chain provider powering today’s digital transformation), having customers pickup their online orders themselves also solves the pesky and expensive challenge of last-mile delivery. The findings of the survey are very interesting; of the respondents that use buy-online-pickup-in-store services, 40% ‘sometimes’ made additional purchases in-store. In fact, returns are also driving traffic. Some 44% (over 10% more than last year) are making returns from online orders in store, with more than 30% doing so to avoid the hassle of return deliveries, and 17% saying they thought they’d receive their refund or exchange more quickly.
“Our 2017 Consumer Survey highlights the changing role of retail stores,” Jim Prewitt, Vice President of retail industry strategy at JDA, said in a statement. “While there has been speculation of a ‘retail apocalypse’, that doesn’t seem to hold true for consumers. No longer the only channel for shopping,
brick-and-mortar stores are still a key cornerstone for a quick and easy shopping experience and the facilitator for popular fulfilment options, like BOPIS and buy-online-return-in-store (BORIS).”
However, the potential risk of going wrong is also high. About half of customers that chose a BOPIS option experience problems, according to a recent Fortune report. Such an experience can be deceptively positive to a business, as sales figures may increase because products have already been purchased. But while the sales numbers might look good, a bad experience could hurt repeat business and generally lower satisfaction. Retailers, who offer BOPIS, must track the entire customer journey to identify potential issues and problems.
Snags in BOPIS services are associated with mismanaged staffing, JDA found. Nearly a quarter (23%) said store staff took a long time or were unable to find the shopper’s order, and 16% said there were no dedicated staff for BOPIS purchases, a situation largely unchanged from last year, JDA said. Target and Walmart are among retailers dedicating staff and areas for in-store pickup. JDA also found 80% of customers surveyed want incentives to make that pickup trip, which introduces other complications. Many retailers (including Walmart, which in April began offering a “Pickup Discount” on about 10,000 items), are offering or testing similar encouragements.
Moody’s Investors Service also believes in the potential of encouraging shoppers to pickup from the stores. Moody’s lead retail analyst Charlie O’Shea praised Walmart’s BOPIS-related discount, saying that it’s “another example of a retailer leveraging its physical stores to provide consumers with more options to receive online orders quickly.” There may be many problems in actual implementation, but BOPIS is here to stay and everyone in the supply chain needs to prepare for the model with better technology and more responsive service.
An advertisement by Pure Denim announcing the in-store pickup facility