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June 30, 2022

Have you missed the click-and-collect train?

Many experts see the COVID-19 pandemic as a catalyst in demonstrating the importance of business flexibility. After all, this willingness to quickly adapt was central to the mid-and-post-pandemic successes of innovative market leaders such as Guzman Y Gomez, Coles and Woolworths. These companies, along with others, managed to thrive by implementing futuristic strategies that would streamline their operations while also increasing service-quality.

The already promising click & collect model is a perfect example of a strategy that absolutely exploded in popularity over the course of 2020. This omnichannel model encourages customers to research, order and pay online before physically coming into the store to collect a product. While the use of this strategy was already gaining significant traction between 2015 and 2019, the pandemic resulted in a >100% increase in year on year click & collect sales between 2019 and 2020. While this growth is obviously not sustainable, research does point to an annualised ≈18% growth in sales between 2021 and 2025.

This continual growth will be the result of greater adoption across a wider range of industries – while the model is already relatively prevalent in the QSR and supermarket sectors, it can ultimately benefit almost any product-based company. Even automotive retailers have started to utilise variants of the click & collect model with industry leaders such as Toyota, Hyundai and Ford all giving customers the opportunity to order a vehicle online before collecting it in person.

Here’s why why your business should be next to adopt the click & collect framework:

Productivity improvements

Nowadays, most major product-orientated companies invest large amounts of money and time into perfecting their delivery offerings. Unfortunately, research suggests that consumers are wary of delivery options with roughly 20% stating that they do not trust the delivery systems of major companies. With this in mind, it should come as no surprise that 35% of prefer to use in-store pick up services. With more people favouring the latter, it could be said that businesses who utilise such a strategy could reduce home deliveries and therefore maximise in-store productivity.

Cost reductions

Following on from the previous point – if a company was able to reduce home deliveries, it would be able to effectively cope with demand while utilising less staff. As a result of this companies can minimise costs while utilising a proven method that will increase profits.

Increase in spending per consumer

A multitude of research focusing on the click & collect model suggests that consumers, more often than not, will purchase extra products when picking up their items. While numbers vary across different studies, there is a general consensus that at least 50% of shoppers will make an additional order when collecting something they ordered online.

Increase in loyal customers

Customers will receive superior service-quality when they utilise a click & collect service. In-store pickup is convenient, reliable, and cheaper than home delivery. In monopolistic markets such as the supermarket or fast-food sectors, service-quality can often be the deciding factor as to whether a customer remains loyal or goes to a competitor. Therefore, businesses in these spaces should be hyper focused on creating competitive advantages through streamlined customer-focused offerings. The click & collect model has the potential to create clear differentiation points that can increase the probability of a one-off customer becoming a loyal buyer.

While the click & collect model was already proving to be a market disruptor prior to the pandemic, an exceptionally unique set of circumstances has seen this strategy explode in popularity over the past 18 months. Dubbed as the ‘ultimate link between digital and physical retail’ the research suggests that businesses who continue to offer in-store pickup services will consistently perform more favourably than competitors who are yet to jump on the trend.

As featured on Inside Retail.

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