Omnichannel Focus on BOPIS

Stephen DeAngelis

January 14, 2020

In the culinary world, Bopis is a spicy Filipino dish made from minced pig’s lungs and heart. In the retail world, BOPIS stands for Buy Online Pick-up In Store and for some retailers it has become the heart of their omnichannel strategy. The folks at Parcel Pending explain, “While you may have heard of BOPIS, you might not have a clear idea of what it really is. At a basic level, BOPIS is fairly straightforward. First of all, in order to have a BOPIS option, you must have a store that has both an online and physical presence. In other words, BOPIS doesn’t work for stores that have an online storefront only.”[1] The Parcel Pending staff continues, “For retailers that have both an online and physical storefront, BOPIS is simply an additional shipping option that appears at online checkout. Individuals can add items to their cart online and complete the checkout process normally, choosing the shipping option to pick up their order in-store. When their entire order is ready for pickup, they’ll get a notification and can pick up their order at any time the store is open.” They go on to note, “There are a few different ways that BOPIS works in real-world scenarios. The first scenario is when an item is actually in stock at the store and the customer wants to pick their order up. In this situation, a store associate receives the order, goes out to the shelf and grabs it, then prepares the order so that it can be picked up. Many stores are offering this service within an hour. The second scenario is when an item is not in stock at a local store, but a customer still chooses to have the item shipped to that store. In this second scenario, the customer may have to wait a few days until their order is ready for pickup.” If you’re wondering why anyone would select the second option rather than having an item delivered directly to their home or other preferred location, the answer is cost. When items are shipped to physical stores for pickup, there is no delivery charge.

BOPIS Benefits

Jason Rosing (@JasonRosing), a Managing Partner at Veridian, observes, “BOPIS … gives supply chains a non-traditional means of fulfilling orders and moving product. In addition, it solves critical challenges in final mile strategies, reduces costs associated with inventory management, and more.”[2] The Parcel Pending staff goes into more detail concerning BOPIS benefits, which include:

Reduced last mile shipping costs. Rosing notes, “Shippers in need of cost reductions and better final mile service should consider implementing a BOPIS strategy.” The Parcel Pending staff adds, “Getting a package to a distribution center costs far less than getting that same item from a distribution center to a residential address. However, last mile shipping costs could be avoided if items were shipped directly to a store for pickup. Put another way, in-store pickup options allow brick-and-mortar retailers to offer a fast, free competitive shopping option without hurting their bottom line.”

Increased Retail Traffic. Anyone who has watched the retail sector knows physical stores have fallen on difficult times (aka the Retail Apocalypse). The Parcel Pending staff writes, “BOPIS by its very nature brings the customer into the store itself. While the name of the game with BOPIS is enhanced convenience, it also increases foot traffic within the store itself. This is a big boon to brick-and-mortar retailers that have been struggling for years to find effective methods to increase the number of customers that are walking through their aisles.”

Integrated Inventory Management. Rosing noted BOPIS could help reduce costs associated with inventory management. The Parcel Pending staff adds, “Prior to the adoption of BOPIS services, retailers had two different inventory systems: one for distribution centers, and one for stores. Online orders would be fulfilled through distribution centers, while in-store purchases would be fulfilled with whatever inventory was on the shelves. BOPIS has caused these two inventory silos to merge. Now, most large brick-and-mortar retailers include their in-store inventory when you are making purchases online. … Now, even if an item is out of stock at a distribution center, if it is in-stock at a store the order can be fulfilled and the item can be shipped directly from that store. … Retailers have benefited because merging these two inventory management systems have given them a full-field view of their entire inventory.”

Speed. Adam Robinson (@AdamRobinsonCDM), Director of Marketing at Cerasis, writes, “Amazon’s new promises to offer breakneck shipping speed created a sense of urgency among consumers … and traditional retailers struggle to stay competitive.”[3] According to the Parcel Pending staff, BOPIS can help keep retailers competitive. They explain, “For customers, the advantages of BOPIS are enough to keep them utilizing the service. One of the first is speed. In general, BOPIS allows customers to receive their item much faster than they otherwise would.”

Security. Package stealing has become a big problem. In New York City alone, 90,000 packages a day go missing.[4] The Parcel Pending staff observes, “[BOPIS ensures] customers will have the security in knowing that their item will actually be there when they visit the store. One of the challenges both shippers and online retailers are running into is finding ways to make sure that customer packages are secured once they have been delivered.”

Chris Martinez, a content strategist at Signifyd, asserts, “Consistent omnichannel customer experiences are a critical success factor for ecommerce. Your customers will tell you what they want — it’s up to you to listen. The solution for eliminating your worst customer friction points could come from basic BOPIS principles.”[5] She also notes, “85% of shoppers said they have made additional in-store purchases while visiting stores to pick up what they already had bought online.”

Concluding thoughts

Martinez writes, “This new model will only get stronger as ecommerce grows. More than 61 percent of consumers have already tried the BOPIS experience. Retail Touchpoints reports that by 2021, 90 percent of retailers will offer BOPIS and 75 percent will be able to identify specific customers in store and have the ability to customize their visits.” Another good reason to adopt a BOPIS option is that Generation Z shoppers like it. Morgan Forde (@morgan_forde_) reports a survey conducted by Package Concierge found, “58% of [Generation Z shoppers] have used Buy Online Pickup In-Store for a purchase, and 60% said it was a factor in deciding where to shop.”[6] Rosing concludes, “BOPIS-driven processes rely on a complex network of connected systems and overarching dedication to provide the right product, sell it for the right price, and get it during the next visit to the physical location. There will always be demand for ship-to-home purchases, but retailers can and should take advantage of BOPIS final mile strategies to avoid unnecessary expenses and increase customer service.”

Footnotes
[1] Staff, “What is BOPIS in Retail?Parcel Pending Blog, 10 September 2019.
[2] Jason Rosing, “As Retailers Eye Final Mile Strategies, They Launch BOPIS to Neutralize Costs,” Cerasis Blog, 16 August 2019.
[3] Adam Robinson, “Trends in Final Mile Logistics,” Cerasis Blog, 15 August 2019.
[4] Winnie Hu and Matthew Haag, “90,000 Packages Disappear Daily in N.Y.C. Is Help on the Way?The New York Times, 2 December 2019.
[5] Chris Martinez, “How the BOPIS model helps eliminate common ecommerce friction points,” Signifyd Blog, 9 April 2019.
[6] Morgan Forde, “Gen Z has a thing for BOPIS,” Supply Chain Dive, 18 July 2019.