Who should own click & collect data? Tim Robinson, CEO, Doddle

22-11-2017 |

Share

Click and collect in store is often an operational area shrouded in mystery. It’s often not clear who is responsible as it touches ecommerce, logistics and the physical retail operations; who should own click & collect data and how can it help grow sales?
We’ve found ourselves asking retailers this question many times over and the answer is different for every one of them. The one thing that is becoming apparent is that click & collect impacts sales in a positive way, so making it a department in its own right may not be as silly as it first sounds.

 

As a fulfilment option, click & collect is unique in the way that it can increase footfall, generate additional purchases, reduce fulfilment costs and eliminate failed deliveries. But only if you get it right. The fact that 32% of consumers experienced an issue with a click & collect order this Christmas suggests there is significant room for improvement. Especially considering that 73% of those consumers would switch retailers following a poor click & collect experience.

Tracking click & collect (or not)

Doddle worked with Practicology to survey 20 retailers in late 2016 on their current click & collect operations and found that the vast majority of retailers don’t track any real click & collect KPIs. The reasons for this are partly because of the vagaries around click & collect ownership but also because a lot of the systems used are still very manual, without the sophistication to give visibility of these metrics.

 

Two of the key findings from the survey were:

1. The operational costs to service click & collect are tacitly acknowledged by some retailers but are not currently subject to any degree of scrutiny.
2. None of the retailers interviewed measured their click & collect performance in any way, outside of knowing the percentage of total online sales / orders and non-collected orders.

 

Avoiding these C&C pitfalls requires a thorough audit of existing C&C operations and monitoring of customer data. So what are the click & collect data points and how do they contribute to the bottom line?

1. Buying behaviour of a C&C customer vs other channels.

Do you know what the average click & collect customer looks like? What’s their profile? What’s their average basket size? How frequently do they purchase? Segmenting customer behaviour by fulfilment channel is important to understand the value of your click & collect customers and whether there is an opportunity to increase their lifetime value through other improvements to the service. It also provides a marker for ROI on any investment made in click & collect, an essential component for justifying service improvements or technology investment.

2. Incremental spend.

Are you tracking the incremental purchasing behavior of a click & collect customer? How robust is this measurement? Is it linked to card details? Or a loyalty scheme? For a lot of retailers incremental spend in store is the golden egg used to justify offering in-store click & collect. It’s common to see retailers manipulate delivery charges in order to incentivise in-store click & collect over third party collection points, and rely on the incremental spend argument as justification. But if you consider that collection at a third party PUDO location might be more convenient than coming into store, then retailers could be punishing customers based on a metric that they struggle to measure accurately.

3. Post purchase behaviour.

Do your C&C customers go on to purchase again? If not, what was the in-store C&C experience like? What happens after a customer collects a parcel from your store? Do they become repeat users? Or do they drop off? If your C&C doesn’t have a great level of repeat usage then what was the experience that caused this? Just as you would pay close attention to the experience of the online checkout, the click & collect experience can also exhibit cracks that dissatisfied customers can slip through.

4. Experience.

The in-store customer C&C experience shouldn’t be something that is only looked at when other data points start to tell a sorry story. Monitoring the in-store experience is also essential to managing costs such as staff FTE requirements. The key areas to be monitoring are: how long do your customers have to queue to collect their parcels? How long is it taking store teams to retrieve a customer’s order? How long is it taking to hand over the parcel to the customer? How long does it take staff to receive and store customer orders? Finally, are you asking customers to rate their experience to enable you to gather a continuous feed of information on how your customers are using and responding to the service?

5. Cost to deliver C&C.

If you’re not tracking the above data points, you may not know what the actual cost of click & collect is to your business. In many cases, investment may be needed to achieve the level of efficiency required to make in-store C&C viable, but in others this investment may be cost prohibitive. If this is the case, it could be preferable for retailers to offer customers the convenience of click & collect but harness the economies of scale offered through third party PUDOs, thereby freeing up store teams to better serve offline customers in store.

 

So who should own click & collect data? Every retailer will have a different structure and there’s no right or wrong way. The easiest way to collate this information is with a single view of the customer, however for the majority of retailers, this doesn’t exist. The more fragmented the departments and siloed the customer data, the harder it becomes to manage and monitor. One thing is for certain though, as the volume of C&C continues to grow, retailers of all shapes and sizes will face mounting pressure to prove the return on investment and efficiency of their operations. If no-one is accountable for C&C, this justification will be difficult to come by.

 

By measuring the above data points, retailers can:

  • Identify the lifetime value of C&C customers
  • Assess whether the C&C strategy is giving customers want they want
  • Measure revenue upside against cost to offer in-store C&C
  • Flag black holes in the customer journey that might be negatively impacting sales and repeat purchase
  • Deliver increased operational efficiency by improving service design, reducing time and number of employees needed to serve C&C customers
  • Improve the customer experience to build loyalty and trust.
  • Identify areas for reducing fulfilment costs and increase efficiency of delivery methods.

 

If Doddle can offer anything from what we’ve learnt in the last two years building our own in-store click & collect experience and studying retailer offerings, it would be that click & collect requires investment, but it’s not without significant upside. A relatively modest investment in systems and processes is quickly recouped through a reduction in manpower hours required to deliver the service, not to mention a reduction in the prime retail space required to offer click & collect.

 

Retailers who offer in-store click & collect face a critical decision in 2017:

  • Continue to operate click & collect without appropriate investment and focus, the outcome of which is likely to be climbing costs to fulfil coupled with dissatisfied customers.
  • Outsource the click & collect experience to better manage costs, buy-in expertise and allow store teams to focus on their core responsibilities.
  • Invest in in-store click & collect technology and operations, manage costs and increase understanding of the performance of click & collect as a fulfilment channel and revenue stream.

 

Click & collect is a new sales channel for retailers. It might seem alien to those grappling with how to manage it now, but putting it under the spotlight will drive better customer experiences and in turn greater sales in the not too distant future.

Related stories.

London – the world’s first click & collect city

Across London, there is evidence of how we are reengineering the city to be able to encourage future growth and ensure we remain a leader on the world stage.

22-11-2017 |
Follow the three C’s for a seamless returns service

Returns are often seen as a necessary evil for retailers, but getting the returns service right can reap rewards in terms of customer loyalty and reducing the overall cost of reverse logistics. Doddle looks at the three C’s essential for designing and managing a seamless returns experience.

22-11-2017 |
What should the click & collect experience of the future look like?

Annual click & collect transactions are expected to double to 203 million by 2021, according to Apex Insight, marking huge demand for the service in the future.

22-11-2017 |