Lockers stocked, and two smoking barrels: a tale of online shopping

Publish date:

In 2013, online retail sales reached record heights, and are expected to continue to rise over the coming years.

According to the IMRG Capgemini e-Retail Sales Index, online sales rose to £91 billion[1] in 2013 (up 16%), and it is predicted that they will break the £100 billion mark by the end of 2014. The online shopping proposition keeps changing, and the newest contender – Click & Collect – has already initiated the demise of other delivery stalwarts. Two barrels are smoking, and it’s about to reload.

Barrel #1: The High Street

With as many as 23,000 empty retail units across the country, and an average vacancy rate of over 14%, the picture is a grim one for the British high street. Even with restaurants, bars and cafés slowly creeping back in and tentatively opening up, the prevalence of metal shutters and fly-posters indicates the stubbornly high rate of unit vacancies. Consumers’ lives are becoming increasingly more hectic; lunch breaks are getting shorter, busier lives demand less time in town and as of yet the rattling of the closing metal shutters has not given us cause to curb our consumption. Time is precious, and signs suggest that high street’s time is running out, as consumers are spending less time stomping about the high street, bags in-hand, and are instead spending it curled up in front of the television in their favourite onesie. On the internet.

Barrel #2: Home Delivery

Consumers have long been challenging businesses – specifically retailers – to make life more convenient for them, and for the most part businesses have responded as best they can. With the rise of the internet came online shopping and home delivery, a modern day wonder that allowed consumers to purchase a new TV from the sofa, some new shoes from the office or the latest gadget from the comfort of their own bed. It was so convenient: all that consumers had to do was wait in at the delivery address at some point from Monday-Friday for delivery between 8am and 9pm; for the majority of people, this was not in the least bit convenient. Arguably, the experience was improved with the introduction of more accurate estimated delivery dates and more constrained delivery timeslots, but despite these changes it was still unable to meet the changing demands of 21st Century consumers.

Interestingly, store-based parcel collection service Collect+ have stated that consumers actually prefer home delivery. However, research undertaken in collaboration with Opinion Matters in 2013 showed that 51% of survey participants felt that home delivery is “fundamentally inconvenient”[2]. Consequently, more is being demanded of retailers, and their biggest response thus far has been Click & Collect.

The Rise of Click & Collect

With the realisation that Home Delivery was not all that it was necessarily cracked up to be, retailers looked to offer customers a more convenient way of purchasing their products. Click & Collect provides customers with the luxury of shopping from anywhere, with the added convenience of being able to collect it from a number of retail outlets at a time that suits the customer. From the retailers’ perspective, this increases footfall and potentially drives sales as impulse transactions are completed whilst the customer is in-store. However, given that these collections are likely to take place during a short break, the value of these impulse transactions is doubtful. Instead, the good customer experience (assuming it is good) will encourage the customer to return for future purchases, and it is this repeat business that will provide the real value.

The IMRG Capgemini e-Retail Sales Index also denotes that transactions completed online for in-store collection accounted for a quarter of multi-channel retailers’ sales. These retailers – who have both a high street and online presence noted a growth of 16% month-on-month in December 2013[3]. In fact, John Lewis are anticipating Click & Collect to overtake Home Delivery as the primary delivery service for 2014’s Christmas online orders.

Innovation in the Sector

Click & Collect has not fully satisfied consumers either; as we continue to demand more convenience in delivery the industry is responding with greater innovations than ever before. Carole Woodhead, CEO of delivery service Hermes, calls this the most innovative period she has ever seen, in her quarter-century in the industry.

With Click & Collect, customers still had to go out of their way in order to get their purchase, and footfall would increase in-store as a result. Now, however, instead of bringing the footfall into stores, retailers are taking their stores (of sorts) to the footfall – underground, bus and train stations, car parks etc. Asda were the first supermarket to announce that they would be installing Click & Collect lockers in six London Underground stations. Others followed thereafter, with Sainsbury’s, Tesco, Waitrose and Amazon confirming they will offer Click & Collect from Underground stations also.

Waitrose, Asda and Amazon locker images courtesy of Design Week, Grocery Insight and Alamy

And this is not limited to non-food; refrigerated lockers allow fresh and chilled foods to be collected from lockers too. Partnerships with third parties such as ByBox and InPost are making these solutions more accessible to retailers, something which could be important for online-only retailers with no high-street presence.

Prepare for Change

Consumers will continue to demand more, retailers will continue to innovate and online shopping will continue to change. We have seen drive-thru collection popping up here and there, 1-hour same day delivery from the likes of Shutl and even flying drones from Amazon, and we will continue to see partnerships between brick-retailers and click-retailers (such as the recent partnership between Argos and eBay) as businesses try and outpace the competition. As consumers we are driving change, but businesses must keep a watchful eye over their shoulder, as ‘the next big thing’ in delivery might have you firmly within its sights.

Related Posts

Customer Consent

How marketers can turn consent from a compliance challenge into a business opportunity

Date icon October 22, 2021

A warm welcome at reception as a customer fills in their personal details is a great starting...


Humanizing healthcare – superior customer experience in insurance

Date icon September 29, 2021

Leveraging data to humanize digital channels can drive personalized, relevant, and...

Customer Centricity

Overcoming the customer-centricity dilemma

Date icon September 28, 2021

The customer is everywhere. As more and more channels to purchase products emerged during the...