Click and Collect Trend Shapes Retailers’ Strategies

By Anjee Solanki, Colliers International, National Director, Retail Services

What is click and collect, and what is driving the movement?

Click and collect is just another way to capture those seeking to have their purchases immediately — it’s a growing market, and retailers are adopting how it’s done. As consumers are excitedly embracing their 24/7 shopping superpower, it continues to become even more convenient and speedy! Think of Walmart’s new TV ads and the drive-through pick up model for purchases made online. Landlords need to embrace these changes as the retail experience evolves.

The popularity will continue to blend the in-store and digital experience. Recently, we have seen digital assistants, such as Google Home, Amazon’s Alexa and Apple’s Home Pod devices become the go-to for grocery and household purchases. As Google calls it, ‘Shopping Actions’ allows you to buy what you want when you want, handsfree.

According to FMI and Nielson, metro cities have seen the highest demand, but that’s also spilling over to suburban markets where the trends are picking up swiftly. Why? Because it’s hassle free! If your day is filled with to-do’s, having the quick pick-up option can provide ease.

It’s safe to assume that the retail revolution is underway. Fueled by innovation and inspiration from some unlikely places, brands are stepping up to capture consumers’ attention every which way.

How sustained is this trend and who are some of the leading retailers behind it?

The click and collect movement has become quite sustainable for retailers for good reason:

• Delivery costs: This trend reduces the added costs to retailers, such as vehicles/delivery costs, extra employees, insurance, etc.
• Returns: Customers can return an item immediately after collecting it, which reduces the need to drop-off, repack and redeliver the item back to the retailer. This also reduces the supply chain costs for the retailer, itself.
• Additional purchases: Research states that collecting items/purchases in store – regardless if the collection area is at the front of the store or not – leads to a second purchase. This behavior is seen more often by younger shoppers, where impulse buys are still at the forefront.

Consumers are demanding a level of convenience that retailers must make work. And each year, the growing demand increases. From 2012 to 2018, an estimate 23% growth of customers who regularly order online, collect in store. With this type of growth, it is no longer a trend. It is a need where retailers must execute well to avoid losing the customer experience.

We’ve seen retailers, such as Target, Ikea, Walmart and Grocers who have all adopted and embraced this model.

What are some of the key takeaways from your research?

Consumers are using more retailers than they did both last quarter and last year. With elevated levels of shopping and higher levels of spending, people are now visiting more stores both to browse and to buy.

Because of this, stores are playing a bigger role in online purchases. As e-commerce continues to grow, the number of consumers who are picking up online purchases in-store will increase rapidly. And, as the majority of consumers who pick up online orders from stores go on to make additional purchases while there, the number of people using click and collect services will increase and is expected to grow over the next few years.

We’ve also seen the beauty industry as the highest growth sector, fueled by a number of favorable trends, including an aging population and strong retailers like Sephora and Ulta.

Looking forward, the vast majority of consumers will most likely spend more this holiday season thanks to higher consumer confidence and a robust economy. You can read more about these key takeaways in the most recent Colliers International Quarterly Retail Spotlight Report.

For comments, questions or concerns, please contact Dennis Kaiser