Curbside pickup is here to stay and retailers are doing everything they can

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For Michael Whitley, going to Walmart’s curbside pickup point offers him a certain independence that wasn’t as widely available in his neighborhood of Huntsville, Alabama, before the pandemic.

“I hate asking for help more than anything,” said the 45-year-old, who also came to rely on service from Publix, Kroger and Best Buy because cancer made it difficult to walk long distances. and increased his risk of contracting the virus. He still does, even now that his health has improved.

“It’s one of the good things that comes out of covid,” he added.

Curbside pickup, BOPIS (buy online, pick up in store) and other “omnichannel” approaches intended to make shopping seamless regardless of point of purchase – in-store, by phone, app or desktop – were already gaining traction before the coronavirus crisis set in at the start of 2020. But the pandemic has forced retailers to quickly adapt to new safety concerns and social distancing norms, and now there is no no more throwback for many consumers: 33% of adults under 50 who started using curbside pickup during the pandemic say it’s a habit they expect continue, according to a study by the Associated Press-NORC Center for Public Affairs Research and the SCAN Foundation.

Retailers ranging from department stores to local hardware stores are weighing in on demand. But some can go a bit further by adding fees.

As inflation slows shoppers, some retailers are doing better than others

“Retailers have started to see a competitive advantage in this,” said Katherine Cullen, senior director of industry and consumer insights at the National Retail Federation. “They know it’s something shoppers love…and it addresses the reality that there really isn’t a distinction in consumers’ minds between online and in-store anymore.”

A recent series of earnings reports from some of the nation’s largest retailers and government data show consumers are changing how and what they buy. Although they continue to spend, more of their resources are being spent on basic necessities like gas and groceries due to historically high inflation.. This leaves less room for After discretionary purchases like clothes, consumer electronics, or a DIY project for the home.

A slowdown in consumer spending has implications for the wider economy, as it accounts for two-thirds of GDP. This could be a concern for policymakers and economists, especially when consumer sentiment is near historic lows. It’s a combination that can drag an economy into a recession.

To appeal to shoppers, merchants are focusing on improving the experience. A large raffle offers several shopping options, according to Conor Flynn, general manager of Kimco Realty. The real estate investment firm was the first to embrace the omnichannel trend, working with its retail tenants to install their branded green neon parking signs in its malls. The company even filed a “curbside pickup” trademark just before the pandemic hit.

“I think consumer habits and behavior are changing so rapidly that there’s not one thing that’s consistent across the board,” he said. “It’s almost like the way you shop today — there’s no consistency. People go to three different grocery stores for three different things. And I think the same goes for how people shop – whether it’s online, in-store, curbside or online – they kind of want the menu of options that works and whatever works for them that day.

The options are especially useful for buyers with young children. Jelisa Osouna, a single mom in Newport News, Va., opts for curbside pickup whenever her 1-year-old daughter is with her.

“It’s very handy if I need to grab something very quickly,” said Osouna, 30, adding that it saves her having to get her daughter and car seat out of her car. “It can be a lot at times, so the sidewalk is perfect.”

Supply chain bottlenecks and labor shortages during the pandemic have also changed consumer expectations about wait times for online delivery orders. People have realized that pavement and BOPIS are often faster, Cullen said. These changes allowed retailers to cut costs by persuading customers to drive their own cars, using their own gasoline, at their own pace, to pick up their items from the store. The BOPIS model also creates opportunities for shoppers to pick up other items when they walk inside to pick up their order online, Flynn said.

“You get the halo effect,” he added. “And it’s really powerful.”

But Amanda Wise said she uses curbside pickup, in part, to avoid impulse spending. “The problem with Target is that as soon as you walk in, it’s hard to leave without spending at least $100,” said the 34-year-old from Raleigh, North Carolina. Wise added that prices at some stores are cheaper online and that she can use coupons and take advantage of cashback apps or browser extensions when she buys in advance.

Another advantage is that it can avoid the summer heat. Wise drives an Acura with dark leather seats, so getting back into her sun-baked car is unpleasant, she said.

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Most major retailers don’t charge for curbside pickup as long as customers meet a minimum order, usually at least $30-$35. But that could change, said Chad Lusk, retail consultant at Alvarez and Marsal, noting that Sam’s Club recently added a $4 fee for customers who don’t have the premium membership, Sam’s Club Plus.

“As in-store shopping is coming back significantly, retailers must now start comparing the cost of curbside fulfillment using additional labor to in-store shopping,” he said. , adding that the Sam’s Club move could be used “as a means of [incentivize] consumers are fully returning to stores.

Bob Hoyler, retail consultant at Euromonitor International, said he wouldn’t be surprised if other warehouse clubs like Costco or BJ’s Wholesale Club also adopted fees, as customers are primarily drawn to wholesale discounts. . But he doesn’t think the fee would be much higher than grocery stores, especially among consumers who prefer curbside delivery services like Instacart and Shipt to avoid additional costs, including tips.

If a curbside user is in financial difficulty and the grocer decides to add a fee, “you better believe [those shoppers] will investigate alternatives immediately,” Hoyler said.

Some retailers are modifying their physical stores to better accommodate BOPIS and curbside pickup. Best Buy, for its part, has reconfigured some of its stores to make room for backroom warehouse space, Lusk said.

“Further down the spectrum, we see the grocery space investing in micro-fulfillment centers, automated facilities that select and organize orders for in-store pickup and home delivery, separate from the store itself. “, he added.

Micro fulfillment centers, which are often used for delivery within one or two hours, are particularly effective in densely populated areas. But they’re not prevalent in rural areas, Cullen noted. Instead, omnichannel shopping options are especially beneficial for these communities.

These expanded options for shopping are still “in the first leg,” Flynn said.

“I think it’s going to evolve, but it’s very clear that it works and a lot of customers love it,” he added.

About Renee Williams

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