Executive Briefings

Nobody's Home for an Online Order? No Problem

When it comes to online shopping, home isn't always where the package is.

Nobody's Home for an Online Order? No Problem

In the early days of e-commerce, home delivery was assumed to be the buyer's ultimate desire. And while that's still the preferred option for most online transactions, it's rapidly losing ground to other choices.

The trend pops up in the fourth annual UPS Pulse of the Online Shopper survey, conducted with internet analytics firm comScore, Inc. The latter surveyed 5,118 U.S. online shoppers in January, 2015. Respondents had to make at least two purchases in a typical three-month period.

In the latest survey, 33 percent of shoppers preferred that their orders be shipped to locations other than their homes, when they qualify for free shipping. That's up from 26 percent in 2014, a clear indication that e-tailers are broadening their menu of delivery points to include such options as in-store pickup, postal centers, the buyer’s place of work and secure lockers at retail sites.

Contrary to earlier predictions that the age of brick and mortar is coming to a close, physical stores are still very much in the picture. A growing number of shoppers – 38 percent in the new study, versus 35 percent the year before – prefer that their online orders be shipped to a store. What's more, the survey reveals a significant increase in the number of consumers who opt to return online purchases to stores – 61 percent versus 44 percent. "There's a definite trend toward having that convenience," says Bala Ganesh, director of retail marketing with UPS.

The concept of "click and collect," employing lockers as pickup points, is gaining steam. Ganesh says these alternative delivery locations can be either staffed or automated – consumers have yet to express a strong preference for one over the other. So far, though, the setup is proving to be more popular in urban areas, where the options for siting lockers are more varied. UPS currently has nine in Chicago alone, some of which are outside 7-Eleven convenience stores.

Welcome to the age of the "flex shopper." This individual of the modern - day retailing world makes little or no distinction between sales channels, or the devices required to access them. At the same time, mobile computing is becoming an increasingly important part of the overall picture, as shoppers use their smartphones to compare prices, redeem coupons, access product details, check inventory at the store, scan QR codes, and pay for goods.

The study quotes a prediction by eMarketer that mobile searches will exceed those by desktop computer this year, and that smartphone purchases will account for 26.1 percent of mobile commerce in the U.S. by 2018. It's estimated that half of total online retail sales will take place via mobile devices by 2019, the study adds.

Smartphones and other portable devices are, of course, integral to the world of social media, which is having a profound impact on e-commerce. Approximately 76 percent of shoppers use it in some form, Ganesh says, with 67 percent on Facebook and 50 percent on YouTube. And while the actual number of consumers influenced by social media is still small – around 25 percent – there’s a "strong correlation between how heavy an online shopper you are, and how you're influenced," he says.

One surprising finding of the study is that positive consumer responses on social media greatly exceed negative ones. Thirty-eight percent of consumers will promote a brand if they're satisfied with it, while only 25 percent will complain on social media if they aren’t, says Ganesh. Analysis of social-media pages finds that a full 90 percent of comments are positive in nature. It's the vitriolic tenor of the remaining 10 percent that makes it appear as through negativity rules.

"Positive and negative social media posts and reviews influence consumers; therefore it is crucial for retailers to monitor and respond to these posts in order to protect their brand, attract new consumers and retain their current customer base," the study says.

That's not the only way in which retailers must respond to online shopping trends. Physical stores need to embrace their changing role, says Ganesh, and be ready to serve the often capricious flex shopper. Many of the big stores are beginning to fulfill online orders directly from retail shelves, creating the scenario of pickers competing with in-store shoppers for available product.

Then there's the need to accommodate orders that originate at a distribution center and are shipped to stores for pickup by the consumer. According to the UPS study, approximately 48 percent of shoppers are selecting the ship-to-store option. But 45 percent of those individuals purchase additional items when they arrive at the store to pick up their goods. The trend presents retailers with a "substantial upsell opportunity."

Regardless of the fulfillment method chosen by consumers, timely delivery is a must. An excessive wait for an order, or failure to deliver by the promised date, often will result in lost business from the disgruntled customer. Already e-tailers are grappling with the problem of online shopping-cart abandonment, which can result from the failure to offer free shipping or even specify an arrival date. Globally, the study says, more than 80 percent of consumers have abandoned a cart at some point. Ganesh says the ability of an e-tailer to provide adequate information about the product and its delivery options is key to converting a browser into a buyer.

For today's online shopper, "choice continues to be paramount to global shopping behavior as consumers navigate among channels and devices," the study says. "They want to be in control of everything – from retailer selection and product reviews to delivery options and returns."

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In the early days of e-commerce, home delivery was assumed to be the buyer's ultimate desire. And while that's still the preferred option for most online transactions, it's rapidly losing ground to other choices.

The trend pops up in the fourth annual UPS Pulse of the Online Shopper survey, conducted with internet analytics firm comScore, Inc. The latter surveyed 5,118 U.S. online shoppers in January, 2015. Respondents had to make at least two purchases in a typical three-month period.

In the latest survey, 33 percent of shoppers preferred that their orders be shipped to locations other than their homes, when they qualify for free shipping. That's up from 26 percent in 2014, a clear indication that e-tailers are broadening their menu of delivery points to include such options as in-store pickup, postal centers, the buyer’s place of work and secure lockers at retail sites.

Contrary to earlier predictions that the age of brick and mortar is coming to a close, physical stores are still very much in the picture. A growing number of shoppers – 38 percent in the new study, versus 35 percent the year before – prefer that their online orders be shipped to a store. What's more, the survey reveals a significant increase in the number of consumers who opt to return online purchases to stores – 61 percent versus 44 percent. "There's a definite trend toward having that convenience," says Bala Ganesh, director of retail marketing with UPS.

The concept of "click and collect," employing lockers as pickup points, is gaining steam. Ganesh says these alternative delivery locations can be either staffed or automated – consumers have yet to express a strong preference for one over the other. So far, though, the setup is proving to be more popular in urban areas, where the options for siting lockers are more varied. UPS currently has nine in Chicago alone, some of which are outside 7-Eleven convenience stores.

Welcome to the age of the "flex shopper." This individual of the modern - day retailing world makes little or no distinction between sales channels, or the devices required to access them. At the same time, mobile computing is becoming an increasingly important part of the overall picture, as shoppers use their smartphones to compare prices, redeem coupons, access product details, check inventory at the store, scan QR codes, and pay for goods.

The study quotes a prediction by eMarketer that mobile searches will exceed those by desktop computer this year, and that smartphone purchases will account for 26.1 percent of mobile commerce in the U.S. by 2018. It's estimated that half of total online retail sales will take place via mobile devices by 2019, the study adds.

Smartphones and other portable devices are, of course, integral to the world of social media, which is having a profound impact on e-commerce. Approximately 76 percent of shoppers use it in some form, Ganesh says, with 67 percent on Facebook and 50 percent on YouTube. And while the actual number of consumers influenced by social media is still small – around 25 percent – there’s a "strong correlation between how heavy an online shopper you are, and how you're influenced," he says.

One surprising finding of the study is that positive consumer responses on social media greatly exceed negative ones. Thirty-eight percent of consumers will promote a brand if they're satisfied with it, while only 25 percent will complain on social media if they aren’t, says Ganesh. Analysis of social-media pages finds that a full 90 percent of comments are positive in nature. It's the vitriolic tenor of the remaining 10 percent that makes it appear as through negativity rules.

"Positive and negative social media posts and reviews influence consumers; therefore it is crucial for retailers to monitor and respond to these posts in order to protect their brand, attract new consumers and retain their current customer base," the study says.

That's not the only way in which retailers must respond to online shopping trends. Physical stores need to embrace their changing role, says Ganesh, and be ready to serve the often capricious flex shopper. Many of the big stores are beginning to fulfill online orders directly from retail shelves, creating the scenario of pickers competing with in-store shoppers for available product.

Then there's the need to accommodate orders that originate at a distribution center and are shipped to stores for pickup by the consumer. According to the UPS study, approximately 48 percent of shoppers are selecting the ship-to-store option. But 45 percent of those individuals purchase additional items when they arrive at the store to pick up their goods. The trend presents retailers with a "substantial upsell opportunity."

Regardless of the fulfillment method chosen by consumers, timely delivery is a must. An excessive wait for an order, or failure to deliver by the promised date, often will result in lost business from the disgruntled customer. Already e-tailers are grappling with the problem of online shopping-cart abandonment, which can result from the failure to offer free shipping or even specify an arrival date. Globally, the study says, more than 80 percent of consumers have abandoned a cart at some point. Ganesh says the ability of an e-tailer to provide adequate information about the product and its delivery options is key to converting a browser into a buyer.

For today's online shopper, "choice continues to be paramount to global shopping behavior as consumers navigate among channels and devices," the study says. "They want to be in control of everything – from retailer selection and product reviews to delivery options and returns."

Comment on This Article

Nobody's Home for an Online Order? No Problem