Seeking Fulfillment on the Pickup Line

August 20, 2014
 

When it comes to winning share of wallet, it’s all about consumer fulfillment. In order to satisfy rapidly changing customer expectations, brands and retailers must capitalize on the ROI of best-in-class in-store pickup and returns.

So how much does a best-in-class fulfillment strategy mean to shoppers? Apparently, quite a lot. According to a 2013 study by Forrester Group commissioned by Accenture, 47% of customers surveyed said they used in-store pickup to avoid shipping fees, 25% so they could get their products sooner and 10% indicated that they found it more convenient than waiting for a delivery.

In response to today’s faster-is-better calculus, major eTailers are investing in updating their fulfillment strategy. Amazon and Google, for example, are both researching drone delivery. And, back on the ground, eBay, Amazon and Google have all launched same-day delivery in major metropolitan areas, with omnichannel retailers like Walmart, Nordstrom and Barnes & Noble following suit.

Personally, I’m not entirely sold on the whole same-day delivery brouhaha as a viable business model. Sure, I like the idea of instant gratification as much as the next guy. But what products do I actually need so quickly that it warrants the extra cost? Since same-day delivery hit the press a year and a half ago, I’ve kept a record. There have been only three instances when it would have come in handy:

  1. I forgot my phone charger on a business trip and had meetings all day
  2. I left my computer charger at the office and had an unexpected overnight deadline
  3. I got a run in my stockings during an all-day off-site

All three times I resisted the urge to use same-day delivery – even though I lived in a delivery zone and had a free coupon from a former employer. Why? In each case, it was ultimately easier for me to take 15 minutes to purchase online and pick up at a nearby store. This is an irony of the same-day model – it’s primarily available in major cities where there are plenty of stores on hand.

Now, as for in-store pickup and returns – along with fast and preferably free shipping – this, I won’t live without. Though I fancy myself unique in all ways, I am actually among the 78% of consumers who consider in-store pickup of online orders either important or very important (CFI Group).

That said, retailers and brands are struggling to keep pace with shifting consumer shopping expectations. According to Forrester retail analyst Peter Sheldon, only 24% of retailers offered in-store pickup during 2013. Obviously, this is far lower than customer demand. As a result, smart retailers and brands have made these fulfillment capabilities a top priority for the months and years ahead.

You’ll notice I’m not excluding manufacturers from the equation. Here’s why: According to Price Waterhouse Cooper, more and more consumers are purchasing directly from manufacturer websites. In fact, a 2013 study by PWC found that 35% of respondents bought directly from manufacturer websites, with 29% stating that this preference grew out of brand loyalty – the holy grail of product marketing. This is certainly not something a brand should regard lightly.

This is, in part, what inspired Shopatron (now Kibo) Founder Ed Stevens to pioneer a cloud-based order management solution for manufacturers more than a decade ago:

“Our easy-to-implement solution enables more than 900 Kibo-powered brands to route orders to their closest retail dealers for fulfillment. That means their customers can enjoy free in-store pickup and returns along with fast and inexpensive ship-from-store. Not only are we providing a better, blended shopping experience across online and brick-and-mortar channels, but our clients increase revenue and brand equity, while their fulfillers boost sales and in-store foot traffic, resulting in an average 40% lift in incremental sales.”

In short, smart manufacturers must compete fiercely in order to attract and retain today’s demanding omnichannel customers. And that requires providing a world class fulfillment strategy that features direct-to-consumer sales, in-store pickup and returns and fast, low-cost shipping (as a sidebar, a recent Walker Sands survey found that 80% of consumers would be more likely to purchase if offered free shipping). Only then can you ensure that your customers will stick around, instead of seeking fulfillment elsewhere online.

To learn more about how Kibo can help your brand improve sales and customer loyalty, check out our Resource Center or give us a call at 1-877-3500-3866 to request your live demo today.