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Walmart is making a multi-million dollar investment in remodeling more than 400 stores to improve the in-store pickup experience for online shoppers, Retail Dive reports.
The remodeling efforts will move pickup service locations to the front of stores, and add lounge areas for customers waiting to collect their orders. The investments will also include merchandising changes that will broaden grocery selections and bring in more fresh and organic products. Walmart already offers click-and-collect for online grocery orders at 670 locations in the US, its executives said during its last earnings call.
Walmart is one of many brick-and-mortar retailers looking to use omnichannel fulfillment methods that leverage their stores to better compete in online retail. So far, it’s efforts in this area seem to be paying off — Walmart reported 63% YoY online sales growth in the US in Q1 2017. The retailer also started offering discounts to customers who pick up their orders in-store earlier this year, as its only costs 75 cents for the company to ship a package to its stores, Marc Lore, Walmart’s head of US e-commerce, said recently. In comparison, it costs Walmart $5 on average to ship a package to customers’ homes. Providing amenities like a lounge area — along with discounts — could help Walmart expand its click-and-collect customer base as it chases Amazon in e-commerce.
Click and collect — a fulfillment option that lets shoppers place an online order and pick it up at a store — is thriving in the UK.
Over half of UK shoppers report having used this method in the past year, according to a survey from JDA & Centiro conducted in April 2016.
However, the US is far behind on the click and collect trend, with just 27% of consumers using the service. This is largely due to slower growth in mobile commerce, and specifically, the hesitancy shoppers feel about using mobile retail apps.
Retailers in the US can look to the growth drivers in the UK to help drive up their own click and collect sales. Most notably, mobile commerce and adoption by grocery chains are driving shoppers in the UK to use click and collect.
Nancee Halpin, research associate for BI Intelligence, Business Insider's premium research service, has compiled a detailed report on click and collect that breaks down the growth factors behind click and collect in the UK. It also discusses the retailers successfully implementing the fulfillment method, examines the of impact consumer behavior, and outlines some key steps that US retailers can take to replicate the UK's performance.
Here are some key takeaways from the report:
- The UK's click and collect market is expected to grow 78% by 2020, to £8.2 billion ($10.6 billion). Meanwhile, it is expected to reach £5.3 billion ($6.8 billion) by the end of 2016.
- Click and collect is benefiting from consumer adoption of mobile commerce in the UK. Mobile is a fundamental driver because it affords consumers more flexibility in the purchasing process. As a result, many UK consumers are purchasing goods on their mobile phones, and then picking them up on the way home from work, the gym, appointments, etc.
- The service is particularly popular among grocery chains, with many of the UK's largest supermarkets offering click and collect. Since trips to the grocery store are made frequently and regularly, click and collect is a perfect fit for shoppers who want to avoid recurring issues like long checkout lines and crowded stores.
- To grow click and collect in the US, retailers need to invest in their mobile presence and dedicate in-store resources to click and collect shoppers. Merchants should do more than just recreate the desktop browser experience on a mobile app — this includes employing tools like mobile loyalty programs, digital coupons, and social media integration.
In full, the report:
- Sizes the market for click and collect in both the UK and the US.
- Identifies the key growth factors that are making click and collect successful in the UK.
- Discusses key players in the UK that are seeing success with click and collect.
- Presents some of the challenges the US faces in spurring adoption.
- Outlines future opportunities for US retailers to grow sales via click and collect.
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