What did we learn about online delivery in Q1 2016?

Find out how order volumes in the IMRG MetaPack UK Delivery Index fared over the same period.

ORDER VOLUME GROWTH

So far (with three months’ data in) this year, the online delivery landscape has looked reassuringly predictable – with the key metrics performing exactly as expected.

The start-of-year forecast was for +12% growth – for Q1 the year-on-year growth came in at 12.3% with the month-on-month volume trend closely tracking 2015, as shown by the below chart.

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This breaks down by individual months as follows:

Month  Year-on-year growth     Month-on-month growth

January         +8.5%                     -37.5%

February       +16.8%                   -14.4%

March           +12.7%                    +12%

DESTINATION ANALYSIS

Although in the following destination analysis chart the only region showing any real change over the course of the past year is cross-border, it actually matches the trend seen in 2015 – with March 2016 tracking almost exactly in line with March 2015 – and, taking the year as a whole, the proportion of orders going cross-border seems to be levelling out at around the 25% mark.

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QUALITY OF SERVICE

The rate of on-time / attempted delivery performed at its most consistent level of above 93% in Q1 2016, as the wider choice (and better communication of) delivery options and increased use of information alerts when goods are in-transit appear to be having a positive impact.

Picture 3

 

AVERAGE ORDER VALUE

In line with the trend seen in the sales index (where the average basket value was recorded as rising +5% during Q1 2016), the average parcel order value in the delivery index was also up – with March 2016 order values up +21% to reach the highest March figure seen in the history of the delivery index.

SPECIFIED-DAY/ NEXT-DAY DELIVERY

One area where we did see a break with trends in previous years was the proportion of volume being sent by specified-day / next-day delivery services in March. At just below 35% of all volume, these services have not been used so much at this time of year since March 2012.

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The increase in specified-day / next-day may be due to a combination of increasing shopper confidence in the online delivery offer, as well as greater availability of such options either for free or at negligible cost.

WHAT SHOPPERS WANT

However – shopper needs and expectations constantly outpace what industry offers and the newly-published IMRG Blackbay UK Consumer Home Delivery Review signposts the likely future trends that retailers will need to cater for.

For example – although delivery to home remains by far the preferred first choice for most shoppers, the popularity of click & collect options are on the rise.

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In addition, returns has really emerged as a key battleground for providing customers with high quality experiences that meet their requirements. The same review further found that although a steady 80%+ are happy with the overall delivery service they receive – the same cannot be said for returns.

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This is clearly an area in which industry has some work to do in order to keep customers satisfied going forward.

MEMBER VIEWS ON Q1 DELIVERY PERFORMANCE

Ian Caminsky, CEO of InPost UK, says: “IMRG’s report is clear – online shopping is increasing. Consumer confidence is growing because the purchase and delivery experience can be counted on; it’s reliable, consistent and trackable. Although improving, it’s not seen throughout the whole journey – namely returns and in-store collections. 39% of shoppers are unsatisfied with their return experience due to hassle and unreliability and most stores are not built for online pickups and the sheer volume of returns, which are often 20-30% of purchases. This is a key area of focus moving forward, to ensure that shoppers have consistent and fast access to a range of alternative delivery options, such as lockers, for both collections and returns.”

Find out more:

To discuss the above or any other delivery trends and developments, contact andrew.starkey@imrg.org.

Source: http://imrg.org/imrg-insight

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iForce’s Route Genie to integrate with InPost parcel lockers

Route Genie, iForce’s advanced carrier management platform, has secured a long-term partnership that will see InPost UK’s network of fully automated parcel lockers integrated into its software. The agreement will allow online retailers to provide more choice and convenience to their end customers as they’ll be able to return and collect their parcels in as little as 7 seconds!

Route Genie already integrates with each of the leading domestic and international carriers, allowing retailers to process and manage those providers efficiently whilst reducing operating costs. With more than 1,000 InPost UK lockers nationwide, this new partnership will further strengthen Route Genie’s PUDO offering whilst helping retailers to provide their customers with an increased number of delivery options. All of InPost UK’s lockers are accessible 24/7 and located at a variety of safe and secure locations including Morrisons supermarkets, Esso petrol stations, Transport for London (TfL) sites, as well as outside retailers such as Toys R Us.

The Route Genie software has formed an integral part of the iForce proposition for several years and continues to underpin iForce Pathfinder, the company’s carrier management solution, which is currently being utilised by leading retailers such as Dunelm, Waitrose Cellar and Paperchase. Due to its success, Route Genie was launched as a SaaS (Software as a Service) application last year.

Richard Tucker, Head of Sales at iForce Group and Route Genie, said: “We are constantly looking at ways to enhance Route Genie’s portfolio of carriers and PUDO offering. By establishing this partnership with InPost UK we are providing more choice to the online shopper and therefore minimising the chance of abandonment at the online checkout.”

Tony Kells, Sales and Marketing Director at InPost UK, said: “Our dedicated national network of over 1,000 fully automated parcel lockers are accessible 24/7, meaning no more queues or waiting in, enabling customers to collect and return parcels at their earliest convenience. Route Genie is a highly innovative platform and this integration will ensure that retailers can deliver added convenience to the end consumer.”

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UK online retail sales growth doubles to 15% in Q1 2016

UK online retail posted strong double digit grow in the first quarter of 2016 with sales rising by 15% (excluding travel) year-on-year, boosted by strong online sales in March and an increase in average basket value, according to the British e-commerce association IMRG.

The 15% growth in Q1 2016 nearly doubles the 8% growth during the first quarter of 2015 which was the first time when the IMRG Capgemini e-Retail Sales Index recorded a full quarter of single-digit growth.

The average basket value (ABV) also went up from £77 in Q1 2015 to £81 during the first three months of this year, following a general decline throughout 2015.

March recorded solid online sales growth of 11% in a monthly comparison with February and the average basket value of £82, IMRG stated.

Several sectors showed a strong performance in March. The accessories sector recorded a spectacular 58% year-on-year growth – the highest increase since May 2015. With the main theme of the month for Brits being spring cleaning, the Home and Garden sector recorded a particularly strong year-on-year increase of 26% – the highest growth since February 2014. The sector also revealed an ABV of £93 – the highest since October 2012. IMRG stressed that the drive in online sales can be attributed to the strong growth of 33% in the Home sub-sector, compared to the Garden sector which saw a drop of 12% on the same period last year.

While Brits increasingly shop via mobile devices, the divergence between tablet and smartphone sales continued in March, as sales via smartphones surged ahead with a massive 101% increase year-on-year (excluding travel), compared to only 6% growth via tablets. In Q1 overall, smartphone usage grew almost nine times with 96% compared to just 11% for tablets. This can be seen as part of a wider trend in the sector.

Tina Spooner, chief information officer, IMRG, said: “Sales via smartphones continue to surge ahead, growing at 9x the rate of sales completed on tablet devices during the first quarter of the year. There is no doubt that larger screen sizes have enhanced the user experience on smartphones over recent years which is a key factor in the shift towards shopping on these devices.”

Smartphone is the fastest growing channel in the UK online retail market – conversion rates were 50% higher in Q1 than the same period last year and average online transaction values reached a record high of £85 during March. Not surprisingly, many retailers are placing a significant focus on their mobile strategy as consumers shift towards handheld devices when purchasing online,” she added.

Richard Tremellen, retail insight and data specialist, Capgemini, highlighted the double-digit growth in online sales during Q1 2016 as a highly positive sign for the sector, further strengthened by the average basket value growth. “There appears to be a sizeable shift in consumers’ confidence in online shopping.”

Source: https://www.cep-research.com/news

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Click & collect update (April 2016)

Original article: http://imrg.org/index.php?catalog=2743 

Click & collect has become a prominent fixture for many multichannel retailers – in-store as well as using third-party lockers – and shopper awareness of it as a fulfilment option is high.

If we look at how this translates to actual usage in the IMRG Capgemini Quarterly Benchmark, the share of total orders completed using click & collect for multichannel retailers has reached the following percentages over recent years:

  % Click & collect sales
2011  8.8%
2012  13.7%
2013  15.2%
2014  17.8%
2015  22.5%

During 2013 and 2014 the penetration rate increased by 2.5 percentage points each year – however last year we saw click & collect grow by 4.7 percentage points compared with 2014.

Blog table

While this shows a steadily-increasing trend year-on-year – click & collect sales as a percentage of total online sales for multichannel retailers grew 155% between 2011 and 2015 – the story is more complex when broken down by quarter:

As can be seen, the rise in the percentage of click & collect orders being made is not linear but has tended to fluctuate over the course of each year.

However, in 2015 it appeared to reach a plateau of sorts with very little change in each quarter and reaching an all-time high penetration rate of 23% in Q3.

What the retailers say

In our retailer survey last month (30 respondents) we asked some questions about present usage of click & collect solutions.

It found that just over half of respondents (both multichannel and online-only) currently offer a click & collect service. It is more common among multichannel retailers (with 71% offering this service) compared to around a third of online-only merchants.

Of the multichannel retailers that offer click & collect, a third (33%) offer it both in-store and via third-party collection.

In terms of charging for the service, just over a quarter (27%) of respondents said that they currently do with the costs ranging from £1.95 to £3.95, using various charging thresholds.

Ian Caminsky, CEO of InPost UK: “Click & collect sales have seen overall growth rates as high as 155% since 2011, so it seems surprising that only just over half of all online retailers offer this service. And out of that number, only 33% provide a third-party collection option, which represents a gap in the personal logistics chain that shoppers clearly would like to see filled. For instance, around 36% of shoppers were unsatisfied with their in-store collection experience last Christmas. If retailers offer these shoppers a convenient alternative, such as a fully automated 24/7 parcel locker in a nearby location, they are well set up to increase sales.”

Tim Robinson, CEO, Doddle: “This data is no surprise to us and proves that consumers value a range of convenient locations to pick up online orders. In-store and third party collection are experiencing their greatest share of the delivery market to date. Interestingly, growth in the adoption of click and collect didn’t stop at ‘peak’. In January, Doddle’s collection volumes were 20% higher than November which included the significant sales period leading into Black Friday. There is a cost to retailers for offering a sustainable and fit for purpose click and collect solution: However, aside from the obvious cost savings through consolidation versus home delivery, we’d argue the cost of not offering one is much greater.”

Nick Landon, managing director, Royal Mail Parcels: “A 2015 Triangle study found home delivery (83%) to be the preferred method for online shoppers, with a further 14% of items going to work addresses, just 1.5% going to click & collect in-store and 0.8% to Parcelshops (including post office branches). That said, we do anticipate demand for alternate pick-up points to increase as consumers look for more flexibility and convenience. In-store click & collect is also definitely growing but comes with cost and not yet impacting the overall addressable market growth rate – it tends to impact purchases that would otherwise have been made in-store, rather than delivery traffic. However, various market research studies suggest that both forms are growing fast, albeit from a low base.”

Notes

Definition of click & collect metric – total gross revenue generated through pre-paid web order for collection in store or other drop off points as a percentage of total gross revenue for the quarter (transaction completed online)

Find out more

View the latest Quarterly Benchmark results now – and contact tina.spooner@imrg.org if you have any queries about our data or are interested in joining a benchmark.

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More than 5 million customers worldwide used InPost Parcel Lockers

By the end of January 2016, InPost parcel lockers were used by 5.4 million unique users worldwide. Only last month, more than one million customers used parcel lockers in different markets. Data collected by InPost¹ confirms that innovative terminals enabling consumers to send and collect parcels 24/7 are steadily gaining popularity all over the world.

From the beginning, InPost has been working intensively on its expansion in Poland and across the world. Currently we have 5,000 innovative terminals around the world, and in response to the growing demand for click & collect solutions we are going to continue the expansion of our network. At the same time we are continuously focusing on increasing the ease of use of our devices by introducing additional functionalities, such as card readers, which in most cases also allow contactless payments. Responding to growing cross border transactions, our company has implemented the solution, which allows for delivery from Poland to InPost Parcel Lockers abroad.” – says Rafał Brzoska, CEO of Integer.pl Group.

InPost parcel lockers currently operate in over 20 countries from Great Britain, France and Italy to Poland, Russia, Canada and Ukraine. The company plans to deploy another 4,000 terminals in Europe, both Americas, and the Middle East.

International recognition for InPost parcel lockers® has been confirmed by numerous awards, including: the title of ‘Supplier of the Year’, won during Post Expo 2014; fourfold winnings (2010–2013) at the prestigious World Mail Awards; ‘Retail Innovation of the Year 2013’ from Postal Technology International; ‘The Delivery Excellence Award 2014’ in the category: ‘The Best Carrier Contribution to Delivery Innovation’, received by InPost parcel lockers in the UK.

More information at: http://www.integer.pl.

¹The collected data refer to users of the InPost parcel locker network supported by EasyPack – an Integer.pl Group company – responsible for logistics services of InPost parcel lockers.

https://integer.pl/en/press-release/more-than-5-37-million-customers-worldwide-used-inpost-parcel-lockers

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DX Parcel Exchange offers increased customer convenience through partnership with InPost

DX are providing convenient collections through partnerships with InPost & Doddle.

In January DX announced the launch of DX ‘Parcel Exchange’. This new service gives parcel recipients the opportunity to collect their Internet deliveries from over 1,000 convenient locations nationwide. Utilising offerings from both InPost, the provider of click & collect parcel lockers located at supermarkets, petrol stations and retail parks and Doddle, whose purple stores are situated in railway stations and other major hubs across the UK, DX Parcel Exchange offers greater flexibility for customers looking to collect their deliveries on the move.

DX Parcel Exchange will give customers the option to have deliveries made to InPost’s 1,000 lockers and Doddle’s 45 parcel stores, through one combined web interface, so that consumers can collect their parcels at a place and time of day that best suits them. In order to meet varied consumer needs more effectively, DX Parcel Exchange will add new locations over time to complement those of InPost and Doddle.

Stuart Godman, Chief Strategy & Marketing Officer at DX, said: “Click & Collect has really expanded in popularity in recent years. Consumers are clearly enjoying the flexibility and convenience that online shopping offers and now expect the same from their delivery providers. Convenient collection services are therefore integral to fitting in with customers’ busy lives.

InPost and Doddle both have respected collection propositions and, coupled with DX’s delivery and fulfilment capabilities, we’re confident that DX Parcel Exchange will become a key feature in the online retail market.”

Tony Kells, Sales & Marketing Director at InPost, comments: “DX Parcel Exchange will enable thousands more shoppers to choose their local InPost locker, which can be accessed 24 hours a day, 7 days a week. More people than ever before are keen to take control of their parcel delivery experience, on terms that suit their lifestyles, so we’re very pleased to see DX offer our great solution to its customers.”

Peter Louden, Chief Operating Officer at Doddle, comments: “Consumers want greater control over the delivery of their goods and being able to offer them more convenient delivery options is an absolute must for any carrier. We’re delighted that DX has chosen to include Doddle as part of DX Parcel Exchange and look forward to helping shoppers to collect their goods from Doddle at a time and place convenient to them.”

https://inpost.co.uk/en/inpost/news/dx-parcel-exchange-offers-increased-customer-convenience-through-partnership-with-inpost

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The future of Click & Collect – can it survive?

Caminsky_1CEO of innovative automated parcel locker provider InPost UK, Ian Caminsky, discusses what the future holds for Click and Collect.

Gone are the days when in-store Click and Collect was considered a ‘nice-to-have’ by consumers when choosing their preferred online delivery method.

Research from Barclays Retail has estimated that Click and Collect volumes will account for more than a third (34.5%) of all deliveries by 20181, due to the added levels of convenience provided by these services. My experience says that is very conservative, evidenced by the fact that John Lewis are already there (they announced in their Christmas results that 35% of online orders were picked up inshore2), indeed some retailers already see their store based collections at 50%. As such, it comes as no surprise that many retailers who resisted offering the service for many years, including big players like IKEA3, now consider it an integral part of their customer fulfilment strategy.

An Unsustainable Service?

Indeed, it’s clear why Click and Collect services have been such a success to date. With people increasingly time-poor, anything that makes daily lives easier and more straightforward is likely to fast become the norm – and in the case of the fulfilment of online shopping, traditional postal services just weren’t delivering. With almost half (48.7%) of UK households unable to receive parcels at home during working or delivery hours4, it’s no wonder shoppers have been quick to turn to alternative delivery options which more easily fit into their daily routine.

“Lockers allow consumers to multi-task their journey via trip-chaining”

So on the face of it, Click and Collect services provide the perfect solution for all parties. Shoppers gain a greater degree of choice, control and convenience and therefore buy more; whilst retailers benefit from increased online sales and provide an additional reason to attract consumers into store.

However, a tipping point is being reached as its soaring popularity is proving increasingly challenging from a logistics perspective and costly to retailers. Providing this added layer of convenience to online customers requires not only additional staff resourcing but also involves the loss of valuable retail estate which could otherwise be used for product displays.

Equally, the complex back-end system required to provide an effective in-store Click and Collect service has meant that more than 44% of retailers feel that in-store collection can cause capacity issues5. 31% of customers agreed over the Christmas period that retailers didn’t have an adequate in-store Click & Collect area, the same number said that they experienced longer than hoped for waiting times because there weren’t enough staff and 24% said they waited too long in-store to get their parcel6.

Times Are Changing

All of these considerations beg the question of whether the current in-store Click and Collect model really does deliver financially for the retailer, whether changes need to be made or other options explored.

Indeed evolution is already underway.

Some leading retailers recently surprised consumers by announcing that shoppers opting for in-store collection for online purchases under a certain price threshold would be subject to a charge. Retailers explained that the overwhelming increase of parcels into stores required them to modify the free service model in order to maintain service levels, thus illustrating the unsustainability of the model.

Sustainability, Convenience and Customer Service

Ultimately, where the delivery battle will be won is in providing solutions that offer benefits for all parties; that meet the demands of the consumer for greater convenience, but not to the detriment of either retailers or couriers.

Providing shoppers with access to a network of over 1,000 automated parcel lockers to collect their purchases answers this very real requirement in the UK by using disruptive technology to revolutionise the retail industry and balance the requirements of all stakeholders in a way that no other technology can. Lockers provide retailers with the ability to get products to shoppers more easily while making the shopping experience more convenient. Users have the ability to collect parcels 24 hours a day, 7 days a week, in as little as 7 seconds so there is no need to observe regular store opening hours and picking up a parcel can easily be ‘linked’ onto many of our journeys (often called trip chaining). Plus it allows couriers to make deliveries and pickups more efficient by eliminating the nightmare of failed deliveries. Given all this, we can plainly see that lockers allow for a more reliable, consistent and convenient experience for the consumer, help the retailer provide a better service and allow the courier to thrive. With a sustainable model that provides better service you get increased sales which, of course, is what it’s all about.

Whilst it is clear that in-store Click and Collect will continue to be prevalent for the coming years, and is growing in popularity as it matures, the current model has to change and needs to be offered in balance with other effective delivery solutions in order for it to survive in the long term.

1. ‘The Last Mile: exploring the online purchasing and delivery journey’ – Barclays Retail, September 2014: https://www.home.barclays/content/dam/barclayspublic/docs/BarclaysNews/2014/September/the-last-mile-report.pdf

2. ‘John Lewis celebrates Christmas boost with click and collect success as Waitrose suffers dip’ – International Business Times, January 2016: http://www.ibtimes.co.uk/john-lewis-celebrates-christmas-boost-clickcollect-success-waitrose-suffers-dip-1536262

3. ‘The future of click and collect: collaboration, convenience and customers’ – eDelivery, July 2015: http://edelivery.net/2015/07/the-future-of-click-andcollect-collaboration-convenience-and-customers/

4. ‘IMRG UK Click and Collect Review 2015’

5. ‘The Last Mile: exploring the online purchasing and delivery journey’ – Barclays Retail, September 2014: https://www.home.barclays/content/dam/barclayspublic/docs/BarclaysNews/2014/September/the-last-mile-report.pdf

6. JDA & Centiro Christmas Customer Pulse 2016 – http://now.jda.com/Christmas-Customer-Pulse-Report-2016.html

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European retailers need Click&Collect to thrive

More than a third of UK-based Christmas Click&Collect shoppers encountered issues with their ‘Click&Collect’ orders, according to the second annual JDA/Centiro Christmas Customer Pulse report.

In a statement issued today (11 January), JDA said: “33% of online Christmas shoppers stated they had experienced issues with their purchases (an increase of 31% from the previous year). Of those shoppers that had encountered any of the problems listed, 48% had suffered from late deliveries or never received their goods; a further 48% had suffered from missed deliveries including when they were at home. Unsurprisingly, more than three-quarters (77%) of Brits online said they would be likely to switch to shopping with an alternative retailer next Christmas as a result of a poor online Christmas shopping experience.”

The research highlighted that despite the perceived issues a growing number (41%) of online Christmas shoppers still opted to use ‘Click&Collect’ services this Christmas compared to 2014 (39%). What’s more, of those respondents that used ‘Click&Collect’ services this Christmas, nearly one in four (24%) said they would use ‘Click&Collect’ more next Christmas. Around 56% said they used Click&Collect to avoid delivery charges, while 49% said it was more convenient than home delivery.

The growing popularity of Click&Collect services is also confirmed by a new report from retail agency Visual Thinking which has claimed that 89% of UK mothers used Click&Collect for their Christmas presents in 2015. Nearly a third of respondents said they were choosing Click&Collect for up to a quarter of their Christmas shopping last year, rising from just 14% in 2014.

The use of Click&Collect services doesn’t grow only during the Christmas holidays. More than half of consumers across Europe regularly use Click&Collect as a delivery option for their online orders, of which 15% use it all or most of the time, according to new Forrester data.

The study also shows that customer expectations for Click&Collect delivery are sky high: 59%of Europeans expect their online orders to be ready for collection from a store within the hour. Yet, most retailers in Europe are struggling to support even same-day collection, according to the research.

http://internetretailing.net/2016/01/the-click-and-collect-experience-fell-short-for-more-than-a-third-of-shoppers-this-christmas/

http://postandparcel.info/70510/news/popularity-of-click-and-collect-soars-at-christmas-claims-new-report/

http://postandparcel.info/70417/news/christmas-click-collect-shopping-growing-in-popularity-despite-the-perceived-issues/

http://e-commercefacts.com/europe/news/european-retailers-need-click-collect-to-thrive

 

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