Retailers missing the mark with BOPIS, shipping
Inconsistencies in operational processes are killing the customer experience.
This was according to a new study by strategic retail advisory firm HRC Retail Advisory (HRC), which revealed that 100% of companies offering omnichannel services are experiencing operational challenges. Specifically, retailers are experiencing execution issues that have caused customer frustration and increased cost to the retailers.
Buy online, pick up in-store (BOPIS) is a major source of retailers’ headaches. Companies describe the initiative as consistently unreliable, as systems often tell shoppers that an item is available in a specific store, yet the store does not actually have it in stock. In fact, 66% of retailers blame BOPIS inconsistencies on inventory inaccuracies.
There are also inefficiencies when it comes to shipping online orders. For example, 77% of retailers ship primarily from e-commerce fulfillment centers instead of from local stores that may be closer to customers’ homes or offices — a move that would enable customers to receive their orders quicker.
The biggest challenge overall is identifying which is the most cost-effective location to ship e-commerce orders from, and how to allocate merchandise to stores based on consumer demand. Currently, 70% of retailers are not optimizing their customer order systems to prioritize filling the entire order from one location, causing split shipments and increasing freight costs.
A lack of analytics are also impacting omnichannel experiences. Only 14% of retailers surveyed use predictive analytics, and most of these retailers are struggling to figure out how to integrate such analytics into operational processes, according to the study.
“Brick-and-mortar retailers have overextended themselves as they’ve tried to leverage their physical store fleets,” said Antony Karabus, CEO of HRC Retail Advisory.
“E-commerce and omnichannel fulfillment and related returns have led to sharply rising freight costs and product margin challenges,” Karabus continued. “Meanwhile, consumers expect ever-faster delivery, pressuring retailers to meet those expectations in order to remain competitive. Very few retailers have formal scorecards to measure the performance and profitability of their omni-channel efforts, which often means they can’t effectively and efficiently take the corrective action needed to improve customer service and profitability.”
This was according to a new study by strategic retail advisory firm HRC Retail Advisory (HRC), which revealed that 100% of companies offering omnichannel services are experiencing operational challenges. Specifically, retailers are experiencing execution issues that have caused customer frustration and increased cost to the retailers.
Buy online, pick up in-store (BOPIS) is a major source of retailers’ headaches. Companies describe the initiative as consistently unreliable, as systems often tell shoppers that an item is available in a specific store, yet the store does not actually have it in stock. In fact, 66% of retailers blame BOPIS inconsistencies on inventory inaccuracies.
There are also inefficiencies when it comes to shipping online orders. For example, 77% of retailers ship primarily from e-commerce fulfillment centers instead of from local stores that may be closer to customers’ homes or offices — a move that would enable customers to receive their orders quicker.
The biggest challenge overall is identifying which is the most cost-effective location to ship e-commerce orders from, and how to allocate merchandise to stores based on consumer demand. Currently, 70% of retailers are not optimizing their customer order systems to prioritize filling the entire order from one location, causing split shipments and increasing freight costs.
A lack of analytics are also impacting omnichannel experiences. Only 14% of retailers surveyed use predictive analytics, and most of these retailers are struggling to figure out how to integrate such analytics into operational processes, according to the study.
“Brick-and-mortar retailers have overextended themselves as they’ve tried to leverage their physical store fleets,” said Antony Karabus, CEO of HRC Retail Advisory.
“E-commerce and omnichannel fulfillment and related returns have led to sharply rising freight costs and product margin challenges,” Karabus continued. “Meanwhile, consumers expect ever-faster delivery, pressuring retailers to meet those expectations in order to remain competitive. Very few retailers have formal scorecards to measure the performance and profitability of their omni-channel efforts, which often means they can’t effectively and efficiently take the corrective action needed to improve customer service and profitability.”