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When supermarket shoppers pick up

Click and collect has what it takes to become the dominant online grocery model in North America

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Loblaw Companies’ new test of click-and-collect online grocery shopping has sparked interest in this new channel. And for good reason.

In Europe, click and collect is rolling out fast in a number of countries, including France, where it is becoming the main online grocery channel; and also in the Netherlands, Belgium and the U.K.

Having established itself in Europe, I’m confident click and collect will become the dominant online model in North America.

READ: Loblaw’s poised to try click and collect

For retailers, click and collect has a number of advantages over home delivery. It eliminates the last leg of shipment to shoppers’ homes, often the most complex and costly part of online retail. Customer pickup points can be located at existing stores.

For shoppers, click and collect gives convenience. Orders can be collected to suit their schedule; on the way home from work, for example.

Britain’s largest grocer, Tesco, has expanded click and collect to more than 250 locations and plans to have 400 by year’s end. Click and collect is now being tested at two smaller Tesco Express stores in London.

And Tesco has started to trial three remote, non-store, click-and- collect pickup spots in York: at a school, in a car park and at a university.

One hot emerging pickup spot is at commuter stations. Transport for London, operator of the London Underground subway, has partnered with several major grocers, including Tesco, Asda (Walmart) and Waitrose to bring click and collect to subway stops.

Waitrose has even built refrigerated storage lockers so customers can pick up fresh and frozen food (photo above).

READ: Lidl set to shake up the U.S.

Delivery lead times are also shortening. Asda now has same-day pickup on orders placed before noon at 250 stores, enabling it to expand in the London area where it does not have the same presence as its rivals.

Asda aims to have pickup in 1,000 locations by 2018, including at all its stores, 200 new standalone gas stations, plus subway stops.

In France, all five leading supermarkets offer click and collect. They’re using the service to expand into city centres, to compete with convenience stores.

A notable example is Auchan’s new Retrait Express. The 800-sq.-ft. click-and-collect “walk-in” store in central Paris carries a wider assortment than traditional Parisian c-stores. Shoppers can order from more than 7,500 items that can be picked up from the store three hours later.

But click and collect isn’t restricted to Europe. Walmart offers the service at more than 30 locations in Denver (where it already delivers groceries to homes) and plans to add its first remote pickup point this year. The 15,000-sq.-ft. facility, near company HQ, in Bentonville, Ark., will sell more than 10,000 fresh and dry groceries.

Then there’s the recent opening of Walmart’s first c-store, Walmart-to-Go. The retailer also plans to open almost 300 small-format stores this year.

Add to this the transfer of Asda’s e-commerce director to the U.S. and we’re starting to see a movement toward a stronger role for online grocery at Walmart in the U.S.

READ: Overwaitea pilots online shopping program

Innovation in click and collect is worth watching. As delivery lead times shorten, and ranges expand, the format’s potential is endless.

Our ShopperVista research shows one in five online grocery shoppers in the U.K. have used click and collect. That number is likely to grow as the service becomes more widely available.

Loblaw’s test, if successful, will likely lead to an aggressive rollout. Its Shoppers Drug Mart stores could become pickup points in downtown areas.

Given the popularity of click and collect globally, including Australia, it’s likely that Canadian grocers will jump into this space quickly.

Stewart Samuel is program director at IGD, based in Vancouver. IGD is a leading source of insight and best practice on the food and consumer goods industry.

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