Retailers must improve their stores to win over the ‘storeless generation’

 

Many shoppers shop online instead of at physical retailers because they simply do not want to go into stores that waste their time. According to “The Next Killer App: Stores,” a recent study by WD Partners, one way retailers have tried to solve these problems is with Buy Online Pickup In Store (BOPIS).

“Despite the appeal of next-day delivery, the physical store still bests the online model by delivering what consumers value above all else — instant ownership,” says Lee Peterson, executive vice president of Brand, Strategy & Design at WD Partners.

The study reveals that BOPIS is the most appealing digital-retail integration technology for shoppers. It serves a fulfillment need — shoppers know what they want and can get it immediately.

The study also found that the mindset of the “storeless generation” or millennials is different.

This generation grew up with chain stores that had little life and no sense of community. They crave social experiences and want shopping to be a social event, something many stores have failed to deliver.

“If physical retailers are looking for ways to win back this generation of shoppers they are going to need to make the appeals of online shopping apparent and integrated into the in-store experience,” Peterson says.

“In a relatively short time, BOPIS has become a marketplace reality,” he says. “If stores can get instant ownership, retailers have a chance to win back online shoppers before it’s too late.”

 

More than 1,500 consumers were surveyed in April 2014 using a nationally syndicated panel.

Respondents were screened based on use of BOPIS shopping behavior. Following the quantitative study, WD Partners conducted a series of in-depth group discussions among frequent BOPIS shoppers representing three generations of consumers — millennial, Gen X and baby boomers.

 

92% of respondents used a BOPIS service in the past month.

Poor customer service and pickup location in the store were reasons for dissatisfaction, and a less-than-ideal in-store experience.

When it came it BOPIS store pick-ups, most people didn’t want to go inside of stores.

The greatest pick-up preferences, based on the top two options, were:

Out of store options:

  • Drive-thru: 57%
  • Curbside: 50%
  • Combined retailer, a subscription-based service where online purchases from several retailers combine for a single pickup: 47%
  • Parking lot kiosk: 32%

In-store options:

  • Front of the store: 49%
  • Self-serve locker: 30%
  • Alternative location, such as post office, convenience store or library: 24%
  • Back of the store: 24%

 

Millennials rank unlimited options and customer reviews — two strengths of online shopping — as their top shopping attributes.

 

70% of millennials and 68% of Gen Xers rate the ability to check online customer reviews as the most appealing aspect of making a purchase.

Boomers rank touch and feel and instant ownership as the most appealing, which are characteristics of in-store experiences.

 

By a wide margin, the electronics category leads the field for BOPIS.

39% electronics and computers

Followed by:
23% clothing, stores and jewelry
19% movies, music and games
17% home improvement
16% home and garden
16% toys, kids and baby

 

Amazon Prime offers its members two-day shipping for an annual fee. This membership could more than double to 25 million by 2017.

Amazon Prime users ranked every BOPIS concept higher than non-Prime users, proving there is an opportunity for retailers.