Online Shopping Draws Consumers Into Stores
|Although many logically suppose that online shopping drives traffic away from brick and mortar stores, a new study finds that the exact opposite is happening.
According to a United Parcel Service and comScore survey of about 5,100 U.S. consumers, released on June 3, about one-third of shoppers prefer having items delivered to a location other than their home, and about half of them are choosing to pick their orders up in stores. And when they go to get their orders, about 45% of those shoppers wind up buying something else.
“The interest of people picking up in-store is going up, and it’s likely to go up next year,” said Bala Ganesh, the retail director of UPS. Many retailers “incentivize free ship-to-store to drive traffic to the store.”
The survey is one of the first to reveal the results of “omnichannel,” a technique retailers are using to compete with online-only competitors, like Amazon. Basically, omnichannel is the strategy of using one set of inventory and assets to fill all orders, which allows retailers to get by without needing to build additional distribution centers.
“I can see where there are pricing benefits to the customer and shipping retailer. It is approximately 5% less expensive to ship merchandise to a business location over a residence,” said a spokesperson with the Nautical Decor Store.
The strategy also takes returns into account. If someone isn’t satisfied with their online order, they can return to a store, which, again, creates the opportunistic situation where consumers might make additional purchases. According to the survey, 61% said they preferred returning items to brick and mortar stores, while only 39% who wanted to ship the item back to a retailer. Although fewer than half of the survey respondents made another purchase while shipping an item back, a staggering 70% made a new purchase when they returned their item to a store.
“The store’s a lot easier, because you go in, you give it back, you get your refund right away and you can look around and just buy something else,” said Ganesh. “It just seems like it’s a lot more convenient, and once you go in, the likelihood of you buying something with an immediate refund is pretty high.”