In 2018, advancements in shipping were some of the biggest retail stories of the holiday shopping season. Free shipping offers by Target and Walmart prodded Amazon to expand its own free shipping policy for the holidays. Meanwhile, buy online, pick up in-store shopping became widespread.
Those were big changes. But even bigger ones would follow. This spring, Amazon raised the bar by pushing its Prime program to one-day shipping versus two-day. Soon after, Amazon started offering secure package delivery to customers’ car trunks.
As shipping options continue to evolve, shoppers’ expectations shift right along with them. So what does that mean as we head into the 2019 holiday shopping season?
Shoppers Expect Free Shipping
First and foremost, it means that — thanks to large online retailers — shoppers are accustomed to free shipping. According to Comscore, the number of e-commerce transactions that included free shipping took a big jump during the 2018 holiday season compared with past years. Shoppers know how to find free-shipping offers: A RetailMeNot survey found that 62 percent of consumers always research deals and discounts before buying gifts. And when a site doesn’t offer free shipping, online shoppers are likely to abandon it in search of a retailer that does.
But shoppers don’t just expect free shipping. They also want their purchases fast. How fast are we talking? According to a study by Accenture, 66 percent of Millennial online shoppers want e-commerce sites to offer a one-hour delivery option in major cities.
As Amazon and big-box stores have tried to answer the call to these shifting consumer expectations with shortened delivery windows. While the wish for one-hour delivery probably won’t come true in time for holiday gift shopping this year, consumers can still expect more enticing shipping offers. Almost all retailers (96 percent) in the RetailMeNot survey said they plan to change their shipping tactics to compete with large e-commerce competitors this holiday season.
Growth for In-store Pickup?
Besides fast and free, there’s another keyword on shoppers’ minds when it comes to shipping: flexible. Consumers are increasingly comfortable using multiple channels to complete a purchase in a way that best suits their schedule and their budget. That flexibility drove the popularity of BOPIS shopping last holiday season.
And 2019 seems poised to be an even bigger year for BOPIS. With an abbreviated holiday shopping season — Thanksgiving doesn’t happen until Nov. 28 this year — consumers will lose almost a full week of shopping time before Christmas compared with 2018. That makes it more likely that late-season shoppers will miss out on free-shipping offers and will instead turn to BOPIS. Salesforce predicts that e-commerce sites offering BOPIS will grab a 28 percent higher revenue share in the last five days of the season compared with competitors that don’t.
Environmental concerns could be another factor driving the rise of BOPIS, a study by Accenture found. Some consumers will opt for in-store pickup as a more eco-friendly alternative to quick delivery.
As more customers seek BOPIS options, retailers that fare the best this holiday season will be the ones that prioritize a holistic in-store and online strategy. For example, Kohl’s omni power center pilot supports online order fulfillment by stores.
Even More Options on the Horizon
In-store pickup isn’t the only new delivery experience that consumers are open to.
More than half (54 percent) of Americans are comfortable receiving something from a retailer at their front door when they are not home. But shoppers are also showing they’re receptive to more secure alternatives, like Amazon’s trunk or locker deliveries (which the company plans to expand). Almost one-third (30 percent) of shoppers would like retailers to find a way to get packages to them wherever they are at the moment instead of dropping off items at their empty house.
As Black Friday gets closer, look for retailers to respond to shoppers’ ever-expanding expectations around holiday shipping. That’s likely to include tactics from more free-shipping deals, whether through offering coupon codes or lowering price thresholds for free shipping, to more expedited shipping, especially targeting customers unprepared for the shorter shopping season.
Consumers can also expect to see expansion and increased promotion of BOPIS programs and new delivery options to enhance convenience and security for shoppers. All of which will be particularly important to shoppers late in the season as they find items they need online but are looking to avoid high costs on shipping as the season comes to a close.
Michelle Skupin is senior director of marketing and communications at RetailMeNot Inc.