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Can retailers survive Christmas without click and collect?

By Will Gillingham

In 2017, IMRG discovered that those retailers offering click and collect during the Christmas period saw a significant uplift in their sales, where those who did not faltered. Year-on-year growth for the Monday before Christmas (sometimes described as ‘Panic Monday’) was 27.7% for those offering next-day click and collect, and 17% for those offering non-next-day. On the Friday before Christmas (22nd) the figures were 11.8% and -3.7% respectively.

On paper, click and collect looks like a means to a greater yield at Christmas, while also taking pressure off the burdened delivery service and driving footfall to high street stores. But is it as simple as that?

Is it vital to offer click and collect at Christmas to make the most of the gifting period, or is it simply a gimmick, particularly with next-day delivery posting record figures this year? We approached our community of experts for their insight.

Choice beats restriction

Before diving into the Christmas peak, let’s look at click and collect as a year-round service.

Customers are fickle. In fact, as highlighted by James Boother, Sales and Marketing Director at Coeo, ‘a survey from 2017 found that 92% of first-time visitors to a brand’s website do not make a purchase.’ Boother suggests this, above all else, is a prime reason for click and collect at any time of year, let alone Christmas.

He continues: ‘It is imperative that retailers provide choice allowing customers to make their own buying journey decisions based on their personal preference.’ That is, to improve the chances of capturing those customers researching on multiple sites, the purchase should be as streamlined as it can be, and that necessitates the option of click and collect.

In 2016, Cybertill & Forbes reported that 72% of online shoppers were already using click and collect services. It’s this figure which has led Adam Foster, Social Media and Content Marketing Manager at ShipStation, to describe click and collect as ‘an industry standard’. He continues: ‘it’s safe to assume this is a growing trend. Click and collect gives your customers more options and freedom to pick up their packages. Without this competitive edge, some customers may buy elsewhere.

We live in a so-called era of ‘instant gratification’, and this is the essence of click and collect. Gone are the days of staring at the letterbox for days on end: all it takes to receive a package now is a ten-minute detour to the nearest collection point on the way home from work. The perks of this around Christmas-time are self-evident: there’s no need to indulge in the panic of Panic Monday by wondering whether a package will be delivered in time; customers can simply duck into a store and pick up their order at their leisure.

It’s no surprise, then, that a recent survey conducted by Ingenico showed that 14% of UK customers were firm on click and collect as their delivery method of choice for their peak purchasing this year.

The figures from this section represent a sizeable portion of UK customers who are not only aware of but are using click and collect. As Boother suggests, click and collect is not a gimmick, but rather a well-established aspect of UK commerce.

But what kind of an impact can a click and collect policy have in the build up to Christmas?

Wreath on red

The peak perks of click and collect

In a recent study, MetaPack found that 33% of shoppers would pay more to guarantee next-day delivery or next-day click and collect. As explained by Duncan Licence, VP Global Solutions and New Products, MetaPack: ‘Clearly click and collect is a necessary part of a retailer’s delivery proposition. Click and collect and ship from store represent a massive opportunity for retailers to present a convenient consumer delivery proposition and to drive much-needed footfall.

In that one statement, Licence identifies the two principle boons of click and collect at Christmas: convenience and an increase in sales. Let’s broach those in further depth.

Convenience

Christmas is a bottleneck for customers and retailers alike, so much so that delivery can’t always be relied upon. As Matthew Foo of AsiaPay mentions: ‘eCommerce sales volumes are increasing every year. Judging by the recent new records achieved by Singles’ Day and Black Friday, we may see the workload increasing for logistics companies. To avoid disappointing customers, retailers should offer alternative solutions.

Indeed, rather than being an alternative, click and collect can be a superlative delivery option for many customers.

The last delivery date before Christmas is usually the last Monday before. Click and collect, on the other hand, can be possible for a number of days longer, and even, in some cases, available on the day itself.

Gary Winter, Parcels Director, PayPoint: ‘Click and collect takes the stress out of Christmas shopping, especially as the big day gets closer. [Click and collect can] allow customers to collect their shopping on Christmas Day and some have even been known to return their gifts on the big day too. Click and collect is an essential opportunity to interact with a previously unattainable customer base.

This customer base which Winter refers to, or at least a section of it, is likely to be those customers on the move. Those travelling for business, or perhaps journeying home for the festive season and not wishing for their gifts to arrive ahead of them. For those people flitting around the country, being able to pick up from a store which they’ll be journeying past is an ideal solution to Christmas buying.

Padraig Slattery, VP Retail at SafeCharge, explains: ‘Click and collect services provide a viable solution for those busy shoppers who are constantly on-the-move and need a convenient pick-up spot to collect their shopping orders without worrying about deliveries (or missing one) at the busiest shopping time of the year. Modern shoppers - especially those who rely on digital payments rather than cash - have grown to expect the most seamless buying experience from their brands, which is often carried out on mobile devices for the utmost convenience.

Keeping the customer happy is a core aspect of retail and one which click and collect does nicely to facilitate. But, of course, a business can’t thrive on contentment alone: somewhere along the line, some revenue needs to be generated. Fortunately, click and collect can provide in this area as well.

Plane wing

Sales

There’s a simple reason why click and collect can result in a sales uplift, and that’s because it can result in a few more days of purchasing. Couple this with the fact that Matalan (and presumably they’re not alone) see additional purchases from 18% of customers who enter their store to pick up a click and collect item, and click and collect at Christmas seems to represent extra revenue simply by giving the option.

Neil Ashworth, CEO of CollectPlus, calls the ebbing high street to attention. He says, 'with high street footfall continuing to fall – as indicated by the recent Black Friday struggles of brick and mortar stores – retailers face a challenge. They have less direct access to shoppers yet need to ensure they are more customer-focussed than ever before. Click & Collect enables retailers to attract more customers into stores and provides a short-term boost to sales.'

Mike Richmond, CCO of Doddle, is unreservedly confident in the benefits of click and collect. He says, ‘it’s business madness not to diversify your fulfilment options at such a busy and critical time of year. [Home delivery] artificially cuts peak short just at the point it potentially hits its greatest potential volumes. Click & collect enables a final hugely valuable spike in demand, with multi-channel retailers able to sustain Christmas trading for several days longer than online-only retailers relying on home delivery.

Meanwhile, Louise Robertson, Marketing Director at Localz, shows how click and collect not only drives footfall, but in Australia is becoming a necessary factor in the delivery mechanism. She says: ‘Click and collect is topical as complaints around delivery are escalating. In Australia - Post has the monopoly and half the time they don't even deliver - they just card straight away. Which is heart-breaking if you Express Post (their overnight delivery service) your Christmas presents to arrive Christmas Eve.

Maria Morais, Industry Principal, Consumer Industries, SAP Customer Experience, highlights the way in which click and collect can combat the likes of pureplay marketplaces. She states: ‘this type of omnichannel service is a way to compete with Amazon lock delivery and other delivery options gaining traction from pure players.

However, she concedes that its standing is a competitor is only applicable when ‘offered without negative friction points.’ Morais goes on to say that ‘the expectation is that customers buy online and can collect in store within hours, not within days.

And herein lies the rub. To make the most of click and collect, it needs to work in tandem with an omnichannel offering. That is, that the products the customer sees online are also going to be in-store, thus allowing them to collect at their leisure.

As not all merchants have the capacity to cater for this, it’s possible to argue a case against click and collect being a necessary aspect of the purchasing decision.

Graph in book

The rub

It’s Malcolm Berg, UK Sales Director of SVS, who gives clarity to the issue. He states: ‘if your customer is running out of time to get that perfect gift, click and collect cannot always be relied on. It’s fine if their local store is open and has that special gift in stock. But if not, their gift may be subject to a logistics lottery, which could result in a poor experience that impacts customer loyalty.

With omnichannel firmly in place, click and collect represents a brilliant opportunity for retailers. As well as driving footfall to the store, it can also be a good indicator of popularity.

Sian Hopwood, B2B Operations, BluJay Solutions: ‘Click and collect can be a vital part of retailers' approach to stock management during the festive period. Online activity can be a key indicator of what might be popular on the shop floor, allowing retailers to proactively manage stock deliveries to stores. Above all, they can avoid an “out of stock” catastrophe.

Click and collect being offered alongside an omnichannel presence is a recommended practice. However, for retailers that can’t offer this, click and collect shouldn’t necessarily be a core aspect of their Christmas trading.

Where click and collect isn’t necessary

Both GFS and Maginus cite click and collect as a secondary feature of Christmas trading. While both address the perks which can come with a click and collect offering, there are other factors which are more important, namely: convenience and clarity.

Gavin Masters, Industry Principal eCommerce, Maginus, states that as long as a customer has a guarantee their package will arrive, how that package reaches them (be it home delivery or click and collect) isn’t of much importance.

Masters: ‘Clear communication, informed customer services staff and a very good “plan B” for failures are all key to getting through the Christmas period. If a consumer can buy online with confidence that they will receive their order even if things go wrong, then they are likely to take more of a risk than if they are simply relying on “first class post” delivery or an ambiguous “within 48 hours” delivery message.

And for Neil Cotty, CEO at Global Freight Solutions, convenience should be the primary concern of retailers, and is subjective depending on the type of retailer being bought from.

Cotty: ‘Focussing solely on click and collect is missing the larger issue of offering genuine choice to customers to suit their delivery needs and preferences, as well as offering the option that best suits their brand. For a luxury retailer, click and collect may not align with the brand image they’re looking to create. If they’re delivering £5,000 designer watches, part of the customer experience is the watch being delivered the next day in high-quality packaging straight to the doorstep.

Finally, Shipstation’s Foster mentions how the drawn-out collection time could lead to a change of mind, which some retailers may want to avoid. He states: ‘This freedom to pick up within 7 days can lead to customers cancelling the order and you losing the sell. Additionally, the customer may wind up picking up a less expensive alternative before collecting. Furthermore, if a customer fails to pick up their order, you could find yourself having to give a full refund.

As with anything, click and collect isn’t an absolute. There are times where it should be used, and times where it would be advisable to forego the service.

Fork in the road

In summary

Click and collect is an upcoming trend in the delivery sphere. A significant portion of UK shoppers are opting to use the service over home delivery throughout the year.

At peak times, this can represent a large boost to retailers’ revenue. Where home delivery needs to be cut off a number of days before Christmas in order to fulfil stated delivery times, click and collect can maintain a strong level of in-store footfall right up until Christmas Day itself (should the retailer choose to be open).

However, while in most cases click and collect is an opportunity which retailers should make the most of, it will work best when being presented in tandem with an omnichannel offering. If the products in-store don’t match those online, then this could result in a poor experience for the customer – an outcome which should be avoided, if possible.

Arguably, while click and collect has the capacity to increase revenue at Christmas, presenting a clear, convenient strategy is where long-lasting customers can be made, and it is this which should be of primary importance.

Will Gillingham, Content Executive, IMRG

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