What is BOPIS in retail?
How BOPIS supports an omnichannel fulfillment strategy
By the end of summer 2020, the share of retailers offering these omnichannel options jumped to 44%. Leading brands like Sally Beauty launched BOPIS capabilities nationwide last year as part of its ongoing digital transformation. “BOPIS is one of the ways Sally Beauty is working to connect customers’ in-store and online experiences, by offering ways to shop that are comparable to big-box retailers, with the added benefit of accessibility,” says Sally Beauty President, John Goss.
What is BOPIS?
BOPIS is a retail sales strategy that has developed with the growth of eCommerce. It is an omnichannel retail tactic that offers shoppers the convenience of ordering and buying online or on their mobile device, and the ability to quickly pick up their purchase at a local store.
How does BOPIS strategy work?
BOPIS speeds order fulfillment, letting shoppers pick up their purchases much more quickly than if they were to opt for home delivery. Shoppers can have their purchases in a matter of hours, compared to several days or more. BOPIS can also speed up a shopper’s in-store experience if that is what they are seeking. BOPIS strategy boils down to improving the customer experience. Additionally, BOPIS can often drive in-store traffic and additional purchases with one study reporting that approximately 50% of all shoppers make additional purchases when picking up in store.
BOPIS strategy connects the online and in-person retail experiences – supporting a stronger omnichannel customer journey. It allows retailers to differentiate themselves and become more competitive. Ultimately, BOPIS empowers retailers to meet customer demands, lower shipping costs, and even up-sell/cross-sell products and services as shoppers enter the store.
What are the benefits and advantages of a BOPIS strategy in retail?
BOPIS has become an essential component of a modern omnichannel retail strategy. Let’s explore some of the benefits in detail:
Customer satisfaction and convenience: The simple fact is, shoppers want the BOPIS option. A recent study shows that 62% of respondents now expect retailers to offer curbside pickup from now on, and 71% expect buy-online-pickup-in-store (BOPIS) to be permanently available. Whether on a break from work or sitting on their couch at home on their tablet, shoppers spend a great deal of time browsing and researching a product online before they go into a store to purchase. And for those looking to have their purchase in their hands today, BOPIS is a great option. It not only offers shoppers more flexibility, but it helps maintain relationships with their favorite retailers.
Faster fulfillment: BOPIS offers quicker and often less complex order fulfillment, presuming the retailer has the necessary underlying technology in place. When a customer selects BOPIS, they gain greater control over when and where the product is picked up/delivered, in most cases allowing for immediate pick up. That beats the average 2-3 day delivery time for most online orders.
Eliminate shipping costs: BOPIS allows customers and retailers to eliminate shipping costs for an order. For some customers, eliminating the shipping costs is a driver to purchase via BOPIS. For retailers, BOPIS reduces time, cost and manual labor in picking, packing and shipping an order. When consumers pick up in store, companies get savings on last mile delivery, packaging and overall logistics costs. That last mile from the distribution center or warehouse often can be one of a retailer’s bigger costs.
Reduced, agile inventory: With the proper underlying order management or inventory visibility solution, BOPIS orders can be fulfilled from multiple channels, commonly from either a distribution center or retail location(s). With real-time inventory visibility, retailers can determine how best to fill the order and draw upon different inventory locations for fulfillment and replenishment, allowing them to lower overall inventory carrying costs.
Reduce costs, increase profits: BOPIS reduces shipping and fulfillment costs, as well as inventory carrying costs. There is strong evidence it also reduces returns, which saves processing costs and increases purchases – all contributing to overall increased profitability. Another revenue consideration: 60% of online carts are abandoned because of unexpected fees, primarily shipping fees. BOPIS can convert frustrated online browsers into buyers.
What are BOPIS best practices?
Customer satisfaction: Perhaps the most important best practice when employing a BOPIS capability and strategy is to ensure a positive customer experience. This requires a smooth online experience that provides the customer with clear instructions about how to pick up in store. BOPIS is a feature that consumers desire and appreciate – don’t inhibit the experience. Make it easy and rewarding for the shopper.
In-store experience: Prioritize exceptional in-store experiences when executing your BOPIS strategy. In-store pickup should be as simple and quick as possible. As mentioned earlier, up to 60% of shoppers make additional purchases when picking up in store. But, don’t give in to the enticement of trying to force BOPIS into an in-store selling opportunity. Instead, create a dedicated, visible space for in-store pick up – and don’t place the BOPIS pickup location at the back of the store. Best practices for BOPIS are to put the pickup location at the front of the store, as well as potentially offering pickup lockers. Finally, be sure to train store associates in BOPIS protocols.
Customer confidence: Consumers want choices and know the options available in the market – whether it’s standard shipping, same-day delivery, in-store shopping or curbside. Make your available fulfillment options clear to them throughout the buying journey. For a successful omnichannel strategy, you must meet customers when and where they want to buy.
Real-time inventory visibility: A successful BOPIS strategy requires real-time visibility into inventory across your entire network. Without such visibility, BOPIS can go wrong quickly. For instance, a customer might order online to pick up in store, only to find when they arrive that the item was sold to another customer and the store is now out of stock. Real-time inventory visibility not only eliminates this problem, but it also provides you flexibility to move and replenish inventory from different channels to support BOPIS and sales in general.
Modern technology: Real-time inventory visibility can be achieved with a standalone solution to enable BOPIS and drive business value. However, to be best-in-class in omnichannel retail, businesses should have modern order management technology combined with an inventory visibility solution to streamline the entire order management process and information flow. A modern, single platform for order management can accelerate transformation by simplifying technology and implementation complexity to deliver omnichannel order fulfillment capabilities from BOPIS to curbside pickup and ship from store (SFS).
What are the challenges associated with BOPIS?
As with any undertaking, there are challenges with BOPIS, as well. The most notable challenges relate to ensuring inventory accuracy and availability, which requires real-time visibility. For many retailers, this is a hurdle to overcome if their supporting technology is dated or siloed. An order management and inventory visibility solution goes a long way in eliminating hurdles and establishing a platform to accelerate BOPIS and other retail strategies.
There are in-store challenges to overcome, too. Dedicating prime, visible and easily accessible space for BOPIS pickup shoppers, and ensuring associates are trained in BOPIS protocols, are both essential for success.
Auburn University has developed a scorecard to evaluate retailers on their execution of omnichannel and BOPIS strategies and outcomes. This can be a helpful tool to fully understand the capabilities required and benchmarks against which to measure BOPIS performance.
It’s important that retailers understand and overcome these challenges because BOPIS is here to stay. BOPIS is not only good for business, but for customer satisfaction. More than 43% of the top 500 retailers are now employing a BOPIS strategy – and 56% of consumers report that they use BOPIS, a number that surged during COVID-19 pandemic.
Technologies that enable retail and BOPIS strategies
Having the right underlying technology is key to successful execution of BOPIS, particularly in ensuring the right product is in the right place at the right time to satisfy a customer’s fulfillment preference. One of the most essential solutions is real-time inventory visibility, complemented by a modern order management solution. A comprehensive order management platform, further enhanced with Artificial Intelligence (AI) capabilities, will provide added advantages that optimize the overall omnichannel experience. Working with many of the world’s leading retailers, IBM offers a portfolio of solutions to help modernize and extend retail strategy and capabilities:
IBM Sterling Inventory Visibility provides a real-time, accurate view of your inventory and demand across warehouses, distribution centers, including what’s in-store and in-transit, allowing you to protect margins, increase customer satisfaction and grow sales. The cloud-based solution leverages your existing systems and data sources to provide a single source of inventory visibility and analysis, processing and updating inventory information at extremely high speed and volumes.
IBM Sterling Order Management accelerates transformation by simplifying technology and implementation complexity to deliver omnichannel order fulfillment capabilities such as curbside pickup, BOPIS and SFS. Empower your business to maximize results by managing business rules that are right for your customers and your business. With real-time inventory management, you can appropriate stock for demand and manage inventory turns. The solution provides an intuitive interface with easy-to-use functionality, so you don’t have to rely on help from IT support staff. Use configurable features for order capture, including real-time inventory through to fulfillment, to power customer experiences that grow sales while improving profitability.
IBM Sterling Fulfillment Optimizer with Watson is an AI-enabled fulfillment analytics solution that elevates existing order management and inventory visibility systems to provide deeper fulfillment intelligence and capabilities to assist you in understanding and evaluating the factors impacting fulfillment performance. The solution, with its personalized dashboard, breaks down data silos to help you monitor developments and trends in demand, inventory and fulfillment. With Sterling Fulfillment Optimizer, retailers are better able to understand and act on changes in their channels and the market as they occur – and take actions to protect margins, utilize capacity, meet delivery commitments and exceed customer expectations. The solution can dramatically improve productivity and increase profits, especially during peak periods.