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Instant convenience: How same-day delivery and in-store pick up are transforming retail

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Image of sillouhettes with this caption: For consumers hoping to avoid shipping costs, requiring secure shipment of products, or demanding products faster - retailers are delivering. Literally.Same-day delivery and in-store pick up are not new concepts for retailers. But in 2012, these services are shifting how people shop in the United States. For decades we’ve been talking about the attempt to deliver products to consumers as quickly as possible. Retail verticals in the gifting and floral industry have mastered this with their network of florists. In 1999, multichannel retailer Circuit City pioneered the option to buy a product online and pick it up in-store. Thirteen years later, the retail industry is embracing an explosion in the number of multichannel retailers offering the buy online, pick up in-store or ship-to-store options for shoppers. For consumers hoping to avoid shipping costs, requiring secure shipment of products, or demanding products faster - retailers are delivering. Literally.

Just in the last several years, retailers including Toys "R"Us, Office Depot and  Home Depot have added or perfected the option to pick up their products at physical store locations. Utilizing their websites, these brands and dozens of others are driving consumers into their stores to pick up products ordered online. For retailers, the benefit of this tactic includes satisfying consumer demands for free, safe, and fast product delivery. Additionally, brick-and-mortar retailers with in-store pick up options are driving consumers to their store locations where they may purchase more products and services. It’s digital retail driving in-store sales and turning stores into assets – a huge win for the web teams.

But the retail giants of the world have been planning their next move. Amazon is playing the game by partnering with companies including Staples, RadioShack, and 7-Eleven, to place Amazon delivery lockers in hundreds of stores across the country. And now, to compete against the multichannel retailers taking advantage of their powerful footprint of store locations and inventory, Amazon, EBay, and Wal-Mart have launched (or expanded) same-day delivery options for consumers in select markets around the country.

While same-day delivery and pick up in-store services have a number of huge fundamental differences in the needs they address and the resources they impact, many of the challenges they hit on are similar. Implementing optimized, streamlined delivery services require:

  • Infrastructure and partnerships. Launching rapid delivery options for retailers involve an elaborate web of infrastructure requirements touching nearly every retail operational system. Some of the leading retailers that have launched these initiatives have implemented sophisticated platforms necessary for product visibility from the heart of the supply chain to the hands of the consumer. Even the best don’t have this perfected, as doing so is incredibly difficult and requires an ongoing give and take across the operational board. Additionally, retailers have acquired or partnered with leading companies in key markets including courier services - a feat on its own.
  • Robust data. None of these services can be launched without significant technology improvements on the back-end for accurate data snapshots. Retailers will need an intense understanding of the inventory position to match with consumer facing data to execute any of these options effectively. This involves everything from analyzing the trickle-polling of data at the store and distribution center level in all of the markets where the services are implemented. It really is  all about the data.
  • Front-line champions. The importance of having retail (store) associate champions supporting these services is critical. This is especially vital for retailers launching pick up in-store and ship-to-store services. The challenge here involves the attribution of the sale and the benefit or reward for the store associate. These things cannot be overlooked due to the countless individual details involved in giving consumers the best experience possible.

While the power of convenience and instant gratification have and will continue to transform retail and win over many customers, these tactics won’t win independently. Implementing these services require major modifications to how retailers operate their stores and their websites.

In our competitive retail space, retailers that transform the shopping experience to hit on convenience, economics, exclusivity, and overall experience, will win over nearly every type of consumer - one exclusive product, deal, or delivery at a time.