Four Reasons Why BOPIS and Curbside will Surge in 2019
By Jeff Baskin, EVP Global Partnerships
In today’s digital age, retailers need to provide their customers with choice, not just in products, but in different ways to order and fulfill them. Alternative retail purchasing solutions like BOPIS (Buy Online Pick Up In-Store), curbside pick-up, and delivery have been around for years now. However, with the emergence of Amazon’s grocery presence, following their purchase of Whole Foods, and their own retail locations, retailers are quickly waking up and are now in a race to find the latest omni-channel innovations to improve and enhance the customer journey.
Grocers, Quick Service Restaurants (QSRs), and other retailers have traditionally been slow to adopt new in-store technology and ecommerce. Now, they are innovating at a fast and furious pace. In addition to keeping up with the competition, innovation is also being driven by customers in the “Convenience Generation”, who demand immediate gratification from simply pushing a button on their mobile device - aka ‘frictionless shopping’. The convenience Generation has forced all retailers to adapt to different service models. Customers expect their order to be ready in minutes, cost the same as if they were going into the store, and be delivered to them with minimal interaction with the staff.
According to Adobe Inc. data, this recent holiday season saw BOPIS orders increase 47% compared to last year. “Weary holiday shoppers continue to look for alternatives to crowded stores, long lines, and empty shelves in the final push to Christmas,” Taylor Schreiner, director at Adobe Digital Insights said just before the holiday. “Retailers who can offer the easiest shopping experience, whether through excellent use of data to anticipate shoppers’ needs or by providing an option for picking up products at brick and mortar stores, are the ones people are flocking to...”
The often tech-deprived grocery space has been especially busy pushing innovation and trying to figure out new omni-channel solutions. Krogers’ CEO recently announced in a Marketwatch interview that their ecommerce sales have increased 56% (they also just launched autonomous delivery vehicles in Arizona). Nielsen and the Food Marketing Institute (FMI) estimates that Americans’ total online grocery spending will reach $100 billion between 2021 and 2023. Walmart has especially made a huge push toward their curbside pick up program. Reporting on its third quarter of fiscal 2019 last November, the company said that it offers grocery pickup at nearly 2100 locations, allowing shoppers to buy groceries from their computers or mobile devices and pickup at the store at NO extra charge. Walmart is betting big on this initiative in 2019 and proved it its first ever cross-platform marketing campaign with a commercial during the January Golden Globes with some well known Hollywood “cars” showing off the benefits of it’s Grocery Pick up Program, such as the Mutt Cutts Mobile from “Dumb and Dumber and the “Griswold Family Truckster” from Vacation.
In addition to retailers building their own solutions, many third party delivery services, like UberEats, DoorDash, and GrubHub, now service the restaurant space. Instacart has done the same in the grocery space and has raised over $1.2B, and after its latest fund raising round of $600M, the company was valued at $7.6B. In addition to supplying over 14,000 grocery locations with delivery, Instacart has realized they need to be in the Pick Up game as well, and now offers curbside pick-up in over 25 US markets (Consumer Reports). “By 2022 nearly one-tenth of total grocery sales will be online, and expected to grow 13% each year, compared with the 1.3% compound annual growth rate expected in-store” (Barrington).
So why has BOPIS and curbside pick-up become so important for consumers and such a focus for retailers in 2019?
Avoid shipping or delivery charges – While delivery is great, the “convenience generation” doesn’t want to pay extra for it. Most third-party delivery services charge a fee or increase the price of the goods being ordered over the in-store price.
Get their merchandise/order sooner – If you’re like me, you don’t want to wait for something that you just purchased. For busy millennials and young families, delivery is not completely predictable. If I order groceries, I don’t want to worry about being home during a 2-hour window. For restaurants, if the restaurant cannot perfectly time the food preparation with the arrival of the third-party delivery driver, the food is not fast, nor fresh.
Want to see the actual item – This is almost the reverse of what we used to do back in the early days. As someone who has been in the retail business for a while, I know that “showrooming” (going to the store to touch and feel the product and then ordering online for delivery) was popular and a huge problem for brick and mortar retailers. In 2019, customers will order online and pick up at the store at their convenience and so they can confirm the items are as they have ordered.
Convenience and Frictionless - With the growing expectation of immediate order and receival of goods, customer behavior is demanding “just in time” service. Customers are pushing retailers to embrace the latest in technology, in order to create a smooth and convenient ‘frictionless’ customer experience.
If they have to wait for an extended period of time or their order is not complete you can kiss that customer goodbye. Would seem pretty simple to execute but as even the largest retailers are finding out meeting the expectations of the “convenience generation” is quite complicated as it creates many different internal processes.
Preparing an order and timing a BOPIS or curbside pickup provides a lot of complications for the retailer. If this were The Jetsons (I know I am dating myself now!), customers would pull up to the store, slow down to 2 MPH, your order would be gently placed in their space trunk, and they would be off to Judy’s ballet recital without a moment to waste. We are not so far off from this level of timely service and convenience and with the latest innovations in IoT, Mobile sensor and location based technologies retailers can accomplish their BOPIS and Curbside goals for customers satisfaction and staff efficiency creating a great customer experience and a positive ROI.
1) Automate the customer experience – Once a customer has placed an order, don’t make them think. Allow them to go to the store at their leisure and not have to announce themselves when they are on their way, nearby, or at the store. This can all be easily automated so the customer does not have to lift a finger.
2) Have the order ready: This seems pretty simple, but it’s actually extremely complicated for the store to coordinate the arrival of the customer with the timing of the order for pickup. When customers need to wait for their food or merchandise order, they are quickly unsatisfied and are often lost for good and even worse can be a huge resource strain.
3) Provide an accurate and real-time ETA to staff: In order to accomplish the above two bullets, you need to be able to locate the customer when they are en route, nearby, and on property. With this information, staff can be alerted with the customer’s location, ensuring the order is waiting for them when they pull up.
4) Know exactly where your customer is: In order to greet the customer upon arrival, you need to know their location when they arrive to your store. Whether the customer has arrived in-store, in a designated pick-up zone or even the entire parking lot, knowing the location of the customer on-property saves staff time and makes for a seamless curbside or in-store pickup experience.
This past holiday season saw a 40% increase in omni-channel shoppers over Thanksgiving weekend, and a 73% increase in BOPIS orders. As long as we can create a much better experience than what currently exists in the marketplace I expect these numbers to continue to increase as the “convenience generation” gets more and more lazy! With the emergence of sophisticated IoT and mobile sensor technology based solutions the Jetsons way of living may just be here already!
To learn more about the latest in curbside and BOPIS Innovations including FlyBuy™ Powered by Radius Networks please visit our website at www.radiusnetworks.com or reach out to me directly at email@example.com. If you happen to be in Las Vegas for CES this week or next week at the NRF show in NYC please contact us to discuss this topic and our solutions further.