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Will a Click-and-Collect Incentive Help Retailers?

by simon
Falling foot-traffic has brick-and-mortar retailers tossing and turning. In the face of eCommerce, how do you make all your channels work? Will more retailers turn to a click-and-collect incentive to encourage store visits and lower the cost of inventory and order fulfillment?

This is serious business. In the US, retailers are shrinking and disappearing faster in 2017 than during the global financial crisis. According to an article on PAYMNTS, retailers cut 60,000 positions in February and March, the worst two-month figure since 2009.

More than a few American retail chains this year will go out of business. The rest will close branches or shut down their brick-and-mortar channel altogether, as retail continues to figure out how to reconcile their business models to the reality of eCommerce.

“It’s an industry that’s still in search for answers,” analyst Noel Hebert told Bloomberg News.

At least one retailer now uses a click-and-collect incentive to make its omnichannel strategy work.

Walmart’s Click-and-Collect Incentive Leverages Supply Chain

There isn’t anything new about buying online with the option to pick up your order in the store. At first, this seemed a lot about improving the brick-and-mortar experience.

After all, an annoying aspect about shopping in a store is waiting to pay at the register. Supermarkets, in particular, have adopted click-and-collect to let customers breeze through checkout.

However, WalMart announced an incentive last week that seems aimed at decreasing fulfillment costs, while making online prices more competitive and getting customers into the store to perhaps buy even more.

The Pickup Discount will give shoppers on a discount on certain online-only products if they opt to collect the purchase from a local store instead of using direct-to-customer shipping According to TechCrunch, Walmart will make Pickup Discount available for 10,000 online-only items at first. But the goal is to expand that to cover 1 million items by end of June.

The program leverages WalMart’s existing, heavy investment in its supply chain. This includes 6,700 and 4,700 fulfillment centers and other locations where they hold inventory.

Obviously, the program can dramatically reduce the cost of fulfillment by cutting down the individual deliveries it must make on an order.

It is also expected to make pricing more competitive with Amazon. And, depending on how the pickup works, the program can potentially lead to higher in-store sales simply by getting the customer in the doors.