Analysis

Is click-and-collect still fit for purpose?

How the mighty have fallen.

Christmas 2014: click-and-collect saved the day, without it the already over-stretched home delivery networks of UK retailers would have collapsed.

Christmas 2015: shoppers left to wait in frustration as in-store click-and-collect counters struggle with ever-lengthening queues of people, and constantly growing piles of parcels.

What happened? Essentially, click-and-collect – and in this context I really am focussing collection from retailers’ own stores – became a victim of its own success. Regular Waitrose shoppers picking up their John Lewis online purchases while stocking up on quinoa and special reserve aged balsamic vinegar couldn’t fail to have been seduced by the convenience offered. Retailer after retailer started enhancing and promoting their in-store collection service, and in a seemingly endless run of annual results summaries it transpired they’d all gone down rather well.

But the downside of popularity is that it tends to involve droves of people. While I’ve never personally sampled the delights of special reserve aged balsamic vinegar, I have been known to order from the John Lewis website and collect from my nearby Waitrose, and have found it to be endearingly handy. However, it start to feel like one of Dante’s missing circles when I tried it in the week before Christmas. But no matter how frustrating it was for me and the many sighing people I was queuing with, it had to have been exponentially worse for the staff trying to deal with us.

As is the way with a topic such as delivery and fulfilment, it is sometimes hard to separate personal from professional, and so it was that way back then in December the idea that click-and-collect is broken started to bubble away in a poorly-lit corner of my mind.

Since then I’ve talked to many people in the industry and having collated the thoughts, views and opinions of people who see the collection market from different perspectives, I’m publishing a mini series of features asking whether in-store collection is still fit for purpose.

It’s a theme that came up at April’s eDelivery Expo (EDX16), too.

Speaking in one of the panel debates, Dave Crellin, head of online operations development at Sainsbury’s described click-and-collect as a “niche”, going on to say: “It serves some customer missions, some products but not all. The idea of a really nice, tight delivery slot for a product that suits you, logically must trump collection. Click-and-collect has a part to play, probably more in non-food than food, but also food. There are various stats rolling around on how fast click and collect will grow – it’s entirely predicated on the quality of the experience.”

The quality of the customer experience is crucial, especially if you accept that collection is a compromise and home delivery is really what everyone wants as their first choice. Neil Ashworth, CEO of CollectPlus sees this as a bit of a litmus test on the extent to which retailers consider things from the customer perspective. “What’s the value I’m getting, as the shopper, the customer, for the collection fee I have to pay? How does the service I’m getting compare wit the convenience of a home delivery?”

Ashworth also makes the point that the location of a retailer’s collection counter tells you a lot. “Increasingly, retailers are looking at the pressures on their collection networks and how those networks are resourced and supported. Traditionally, they’ve tended to be bolted on to the retail offer. In fact, in many cases this is still being viewed as a storage problem, which is why you find some collection counters at the back of the store. But it isn’t, this is actually a customer service concern.”

For retailers still measuring yield per square foot of shop floor, the idea of giving prominence to a collection counter must feel like the lunatics taking over the asylum.

But the world has moved on, and nowhere is that more evident than in the retail sector which has undergone a great deal of change in the last 10-15 years. Retail is no longer linear in nature; shoppers can go online and buy whatever they want from wherever they choose, whenever they feel like it.

Collection points in stores are of huge significance to an army of shoppers who want to blend in-store and online interactions – for some they are the most visible physical points of contact they have with a retailer, and ought to be treated as such.

Those retailers that don’t see it that way are using 2D metrics to evaluate a 3D world – and that won’t work.

Other speakers at EDX16, such as Richard Locke, head of general merchandising at Ocado, were also somewhat sceptical of the role of click-and-collect.

“Click and collect is solving the problem of delivering to someone when they’re not in – the real solution is to deliver to them where they are, when they are,” he said. “Click-and-collect will hopefully see a decline – I’d like to see that – I’d like to see us getting things to people when they want them. I’d like to see people being more demanding, saying you come here when I want you to, and more fussy.”

Speaking in the same panel as Sainsbury’s Dave Crellin, Lana Jackson, head of customer proposition and delivery at New Look said click-and-collect might be seen by some customers as preferable because it’s cheap, or in some cases free, saying that New Look click-and-collect basket sizes are “significantly lower” than for home delivery. “That says to me that customers are selecting that for free delivery at a lower threshold rather than for convenience,” she told the EDX16 audience.

Low-cost options tend to have an image problem: low perceived value. It can be challenging to elevate them to a point where they are seen to be offering a value worth paying a fee for – a fee that actually relates to the cost involved, rather than a nominal sum.

The challenges facing in-store collection are several, this much is clear. What is less clear is how well these services will perform under duress later this year.

In coming weeks, I’ll return to this topic and explore a range of views and opinions. In the meantime, if you would like to get involved in the conversation, please get in touch.

You can leave a comment here, drop me an email, or better still follow this conversation in the eDelivery LinkedIn Group.

 

7 comments on “Is click-and-collect still fit for purpose?

  1. Raf said:

    My observation is that there is also a correlation between the value of the order and the way customers get it. The smaller value customers are less likely to order home delivery because it takes considerable % of the whole price to pay. But that’s a challenge for retailers, because if C&C is free there might be a profitability issue with low value orders. I think retailers need to optimize C&C operation to make it as cheap as possible, both in terms of logistics, in-store operations and service. I think good idea is to implement in-store self-service solutions for customers, reducing in-store operations and improving customer experience (no queuing). What do you think?

    • Sean Fleming said:

      Hi Raf – thanks for leaving a comment. I like the self-service idea that you refer to. In fact, at the eDelivery Expo in April I saw some interesting examples of what’s being done to bring ecommerce into the store at many retailers, with touchscreens and kiosks. It may be in its infancy, but I think there’s a great role for this kind of tech to enable a new era of omnichannel maturity.

  2. The growth of Click & Collect demonstrates that it is a service customers want and value. For whichever particular reason suits that customer (convenience, speed, price, control) Click & Collect offers a solution that suits them. I agree the customer experience of using the Click & Collect process at a retailer is critical and perhaps will be a deciding factor as to whether the customer will use the service again. We at Collectec focus on this part of the Click & Collect process providing instore technology to minimise the retailers cost and ease of providing the service and in doing that provide a fast efficient service for customers. The collection service needs to be agile and able to flex and match the peaks and troughs during the day while maintaining an efficient operational cost. Technology in this space can enable the in-store collection service, engage customers and improve their experience of the collection process.

  3. Frank van Os said:

    I’m convinced the future will not consist of either Collection or home delivery. Both models serve a need, and although one particular person may have his preference, he may use the other service also at moments when this is offers just a better solution for his specific occasion. If I buy online today and I will not be home tomorrow I will choose to collect it, because then I know I will have it tomorrow. But I also may pay something extra to have it delivered same day. Choosing the delivery option that is right for me is not only about convenience and price, but also about control.
    Especially in urban areas there is an increasing urge to decrease traffic, congestion and CO2-emissions. For sure the ever-growing amount of home deliveries are not a sustainable model from that perspective.
    In both home delivery and C&C services we see rapid developments, with new technologies being applied. For home delivery there is increasing interaction between carrier/retailer and consumer on the moment of delivery via apps or other tools, and there are drones and droids (e.g. Startship, Sidewalk) being tested to go live. For Collection services we see self-service parcel terminals and stations being developed that are more convenient and economic than the traditional lockers boxes (e.g Cleveron’s PackRobot). And integration between those type of stations and drones and droids is about to be introduced.
    Technology also will drive collection solutions for fresh and frozen products and Self-service stations that are fit to keep those producs at the right temperature are also being developed and tested by various parties. Cleveron will launch their FoodRobot and Asda has set up their ‘Intelligent Click&Collect Pod’ in St. Helens in the UK.
    At the end of the day it’s not just about technology. It’s about developping the right business models with those technologies that make money and offer a great customer experience at the same time. And I expect there will be multiple models and services for multiple consumers and needs, and technology will definetely enhance the services and lower the costs.

  4. Andrew White said:

    Its clear that C&C has taken hold because it suits the consumers pattern and profile. It seems a bit of a bi-product that’s really got some consumer benefit.

    However the User Experience around the service hasn’t been properly thought through, investment in the wider service is lacking and as such, staff and struggling and consumers aren’t getting the optimum experience. I believe its all around the communications. Clear sign posting (in store and on the users device), using technology (for example having a staff member notified of a collection when the consumer crosses the store threshold (possible with Wifi technology) and a clear tracking of items collected (to reduce loss for the retailer). A great concept, but needs work

  5. I am not sure that people use C&C out of frustration with home delivery – it is simply that home delivery does not suit their lifestyle requirements.
    In an ideal world, the Ocado perspective is understandable, but the customer needs to understand that there is a premium for such services (and for triangulated delivery services, this could be considerable).
    Retailers have built C&C capabilities instore often based upon outdated metrics and productivity statistics. When you look at the turnover per foot of C&C the numbers can comfortably outshine the remainder of the store, hence my perspective that this is a service element of a store footprint, and not purely a logistical one.
    Click & Collect will be around for some time to come, both in retailer store and in networks like Collect+, simply because customers like the flexibility and control that it offers, at a reasonable price.

  6. Guy Eastwood said:

    I’ve seen this problem coming for quite some time now – capacity constraints exist within retailers stores network as they do in carrier networks. The comment from Ocado I agree with – people do want more flexibility in their delivery options and technology is helping now in providing opportunities to divert / delay delivery as plans change after an order has been placed.
    The well publicised introduction of charges for Click & Collect by a number of retailers last year reflects the truth that there is a cost to this service somewhere – particularly for the retailer if they are not able to get the orders to the collection point via their own delivery infrastructure. I believe many people use Click & Collect out of frustration with the home delivery options available and, often, the prices associated with those services.

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