By Greg Zakowicz, senior commerce marketing analyst at Bronto
⏰ 4-minute read
During the proliferation of e-commerce, retailers with brick-and-mortar locations have begun offering the ability to buy online, pickup in-store (BOPIS) in an effort to stay competitive.
BOPIS comes with effects that online-only retailers can’t mimic, such as getting customers into a store where they may make additional, impulse purchases.
As BOPIS continues to evolve as a retail discipline, convenience should be kept top-of-mind.
Brick-and-mortar retail is dead … right?
E-commerce accounted for roughly 10% of all retail sales in 2018, and its share is growing year-over-year.
This growth has forced brick-and-mortar stores to evolve to meet shifting consumer demands, allowing them to stay relevant in an era when they could be quashed. Much like Superman emerging in Lois’s darkest hour, buy online, pickup in-store (BOPIS) has emerged as a tactic that retailers are increasingly adopting in reaction to e-commerce’s proliferation. BOPIS provides consumers with an appealing fulfillment option and gets them to visit brick-and-mortar stores.
If you have a physical storefront or plan to open one, as many online retailers are, BOPIS may become your Man of Steel while serving as kryptonite for retailers that don’t offer this option. Sixty-eight percent of shoppers have made multiple BOPIS orders, proving demand for this service.
In short, brick-and-mortar retail is not dead, and BOPIS may be a big reason why it’ll exist for years to come.
Why BOPIS is a big deal
Today’s consumers expect fast and free shipping. For retailers, meeting this expectation entails spending lots to improve supply chains and quicken last mile delivery. In addition, many retailers either can’t offer free shipping or must instate minimum spend thresholds in order to recoup some of the costs.
BOPIS does not completely solve these supply-chain challenges, but it does help with customer satisfaction. Forty-eight percent of consumers say “saving on shipping costs” is the reason they chose BOPIS over shipping by mail. And when customers pick up their orders in-store, it eliminates the need for (and cost of) last mile delivery, which allows retailers to squeeze a little more profit out of each purchase.
BOPIS brings customers to retail storefronts, where they're likely to make other purchases.
A competitive differentiator
BOPIS is a great way for brick-and-mortar retailers to compete with online-only retailers. Take Amazon for example (which has an increasing brick-and-mortar presence but is considered an “online-first” retailer). They’re primarily credited with (or blamed for) creating the “fast and free delivery” culture that has reshaped retail. Amazon accounts for nearly half of all U.S. e-commerce, which makes competing with them a necessity. Winning this competition is often challenging.
This is where BOPIS can help.
BOPIS erodes some of Amazon’s power.
Amazon offers quick, free delivery because it recognizes that customers prefer to receive their purchased items as soon as possible. As other retailers increasingly offer the ability to pick up items within 24 hours of ordering them, it erodes some of Amazon’s luster. (Amazon recently announced plans to develop free 1-day shipping for Prime members, but analysts say legacy retailers like Target and Walmart have counterattacks in the works.) Retailers can use BOPIS as an effective value-add to compete with Amazon, especially during the holiday retail season when last-minute purchases and quick fulfillment needs increase.
BOPIS encourages customers to buy more.
Those last-minute purchases can result in additional revenue for brick-and-mortar stores. According to Order Dynamics, 37% of online shoppers made an additional, unplanned purchase while picking up their BOPIS order in-store. Increasing a user’s spend during a single retail visit is certainly top-of-mind for executives, and it’s something an online-only retailer can’t do as easily as those with brick-and-mortar locations.
BOPIS improves customer satisfaction.
Finally, don’t neglect the power of customer service as a competitive differentiator. Customers who receive bad service may stop shopping with your brand, while those receiving good (or dare I say exceptional) service may become brand loyalists. If you think about BOPIS as a way to put a friendly face to your brand and provide an exceptional customer experience, you’ve just created an immense opportunity to build an emotional connection with your customer. Again, this is something online retailers can’t easily do.
The BOPIS experience -- of getting goods quickly and easily -- can boost your customer satisfaction.
It's about convenience.
The in-store pickup experience is still evolving, but it’s come a long way since the evolution began. In the early days of BOPIS, some retailers situated the pickup location in the back of their stores, aiming to have customers walk past other merchandise and potentially make an impulse purchase. Others placed the pickup location at the customer service counter, forcing BOPIS customers to wait in line alongside those making returns. Neither of those experiences was quick nor convenient. They contributed to an overall bad experience, and bad customer experiences do not encourage future in-store visits.
Many retailers have since adapted, moving pickup counters to the front of the store and creating separate lines for BOPIS customers. There has been no indication that moving pickup counters closer to the front of the store decreases impulse purchases.
Some retailers, like Nordstrom and Target, have added store-to-car delivery for online orders. While this may seem counterproductive to driving additional sales, the opposite may prove true: If a customer knows they can order items online and pick them up without leaving their vehicle, it may encourage additional orders with that brand in the future. After all, from a consumer standpoint, store-to-car delivery is a positive and convenient experience.
🌱 The bottom line
BOPIS has come a long way since its advent, but it is still in its relative infancy. While continuing to reduce costs for last mile delivery, it will likely increasingly serve as a conduit for brick-and-mortar retailers to attract customers to their stores and serve them a better in-person experience.