‘500,000 click and collect locations in Europe in 2015’
The number of click and collect locations in Europe will reach half a million this year, Deloitte predicts. This would be a twenty percent increase on the previous year. The professional services firm think that click and collect will likely become an increasingly fundament part of the ecommerce offer. But it also has a few cautionary comments to make on this trend.
Deloitte just published its prediction about click and collect locations in Europe, which is part of the Technology, Media & Telecommunications Predictions 2015 report. Deloitte writes about the possible options an online retailer has: “Delivery timings on most products bought online to be approximate so as to keep costs affordable, and recipients are not always home to receive the goods. There are workaround to the distribution challenge: parcels can be left with doormen or porters; they can be re-routed to neighbors, assuming they’re in; packaging can even be re-designed to fit through letter boxes.” But these options are not always available. So click and collect could be a possibility.
Mainly lockers as a click and collect location in Europe
“Click and collect offers the best of both world”, it says. “A wealth of choice in selection and flexibility in collection”. There are three main types of location that consumers can pick up their purchases from: in-store, at a third-party location or at a locker. Deloitte thinks that of the expected 500,000 pick-up locations two-thirds will be individual lockers, over a quarter will be third-party locations and the remainder (about 37,000) will be stores.
Click & Collect will become increasingly popular
In Europe, the United Kingdom is the most mature ecommerce market, with 13 percent of all retail revenues from online in 2015, of which about a third will be click and collect, the company says. “We expect ecommerce share of retail to grow in most other European markets, and click and collect to become an increasingly common offer.”
When we look at the benefits for retailers, you could say click and collect would increase the propensity to purchase from the website and, additionally, in-store when the customer is picking up his package. It could also drive aggregate online spend as it offers greater convenience to consumers. But in most markets click and collect stores are outnumbered by both third-party collection sites and lockers. If a customer uses any of these alternatives, the opportunity for incremental sales is gone.
Every element of delivery incurs a cost
Deloitte also notes that offering click and collect could be something stores offer just because a direct competitor does. The company thinks some retailers aren’t yet fully ready to offer such a service. While click and collect lets retailers avoid the cost of delivery to the customer’s home, and can utilize existing space, every element of delivery incurs a cost. “Every square meter of space used for storage displaces space that could be used for display, and any staff member processing a collection is unable to assist other customers. Also, click and collect might make it easier to return goods, leading to over-stocking of baskets and a surge in the volume of returns — with all of the associated complications.”
Deloitte warns retailers to monitor carefully the costs of offering the click and collect service, as in some cases they may need to remove this offer. “”Retailers should also consider how best to structure accounting for click and collect returns. If sales are made by the online team and returns are debited against the story, this could lead to distorted sales and profitability assessments for certain stores.”