Why delivery matters to the UK’s top retailers

Ian Jindal PhotoWith Christmas nearly here and retailers preparing their final shipments before the holidays, Ian Jindal, Founder and Editor of Internet Retailing looks at why delivery is so important to retailers in order to fulfil their customers expectations and the latest innovations in retail delivery:

Why delivery matters to the UK’s top retailers

One key battleground stands out for retailers who trade online: delivery. They understand that little in multichannel retail matters more than getting the goods to the customer in the most convenient way. Shoppers, now used to ordering anyhow, anywhere, any time, are keen to take delivery at the moment that suits them. Retailers are going out of their way to bring orders to where customers are, at times in their day that work for them – after all, who wants to spend lunchtime standing in a queue when collection could be the work of a moment on the way home.

Why should merchants bother? It’s simple. Getting delivery right means traders win more sales, while those who don’t, miss out. Below, we single out some of the latest innovations in retail delivery – and collection – and consider why they work.

Home delivery

It may sound an obvious point, but home delivery works best when customers are at home. That’s why House of Fraser went to great lengths to develop a simple yet innovative delivery service in the autumn. Shoppers ordering online by 8pm can now specify delivery by 9am the next morning.

Announcing the new service, at Internet Retailing Conference 2014, Andy Harding, executive director, multichannel, at House of Fraser, said: “The voice of the customer is telling us that home delivery is not convenient. Most people work, and taking time off work, even when you know which 15-minute window it will arrive in, is still a pain.”

He added: “This is a key battleground, we believe and [in 2015] we’ll be launching even more options.” The service adds to the seven delivery and collection options that already made House of Fraser one of the Elite performers in the logistics dimension of IRUK Top500, InternetRetailing’s analysis of the UK’s leading retailers.

Click and commute

Where could be more convenient to take delivery than on the way to and from work? Collection points are now firmly on the transport network map in the capital and beyond, with grocers including Asda, Waitrose, Tesco, Ocado and Sainsbury’s now giving shoppers the opportunity to pick up their internet orders in Transport for London stations.

John Lewis, another Elite logistics performer in the IRUK Top500, this autumn opened its first Click and Commute store at St Pancras station, where workers on their way home to the east of England can pick up their online orders.

Argos recently opened its smallest store to date in Cannon Street tube station. It promises same-day, next day and fast collection for online orders from the 170 sq ft Argos Collect branch. Using a hub and spoke logistics model, it says it can get any of 20,000 products to the shop in superquick time. Unveiling the service, John Walden, chief executive of Argos’ parent company the Home Retail Group, said: “Digital shoppers are increasingly demanding improved choice, convenience and speed in the fulfillment of their online orders, especially via click and collect; the collection of their online orders from a conveniently located shop.”

[On March 25, 2015, Mark Robinson, customer delivery operations director at John Lewis, will join a panel discussing customer expectations of final mile delivery in the Retail Logistics stream at eDelivery Expo, part of Internet Retailing Expo (IRX) 2015. On March 26, John Munnelly, head of operations at John Lewis Partnership’s Magna Park Campus will be keynote speaker in the Retail Logistics stream. Mark Steel, head of digital at Argos, will give the closing keynote address in the insight stream at IRX 2015, on March 25]

Round the clock

Even the retailer with the longest opening hours can’t match the round-the-clock availability of a locker bank.

This alternative delivery method is now expanding quickly across the UK, and market leader InPost opened its 1,000th lockerbank in 2014, adding to a network that includes Victoria Coach Station and a number of Transport for London stations. Retailers are now moving to open their own lockerbanks as well as using those operated by third parties. Waitrose, for example, has temperature-controlled lockers at London stations, while Amazon has opened its own lockerbanks at sites including Birmingham International Airport.

Asda is set to roll out a network of temperature-controlled ‘intelligent’ click and collect pods early in 2015 as it looks to take the lead in online retailing. Announcing this investment, Asda chief executive and president Andy Clarke said: “We know that a convenient and great value shopping experience is important to customers. Asda is already known as a market leader in value and we have set out a clear ambition to lead online as part of our five-year strategy. Our existing grocery home shopping offer is already growing at more than 20 per cent year on year and this exciting new click and collect technology will allow us to bring Asda value to even more customers – particularly in London and the South East.”

At the last minute

As shoppers grow accustomed to the idea of fast and convenient delivery, their expectations stretch still further. Same-day delivery is now a reality for a number of retailers.

Traders such as Argos can fulfil orders from their stores: via the Shutl service it can deliver orders to nearby homes in as little as 15 minutes, or use its hub and spoke logistics to get a product into the right store for same day collection. But same day delivery presents more of a challenge to online-only retailers who don’t have the benefit of store-held stock.

By building smaller hubs close to large areas of population, pureplays such as Amazon and AO.com are able to offer delivery within just a few hours. Indeed, AO.com’s same-day delivery of large household appliances ordered by noon won it top marks for delivery in the logistics section of the IRUK Top500.

[John Roberts, chief executive and founder of AO.com, will be speaking in the international stream at IRX on March 25 2015]