TREND AND IMPACT

  • The e-commerce boom is resulting in a high volume of shipments, leaving merchants to deal with the steep costs of getting orders to customers — or back to the store for a return. E-commerce accounted for almost 10% of all US retail sales in 2018, up from 8.9% a year prior. As e-commerce grows, so do the costs associated with last-mile delivery and e-commerce returns. Last-mile delivery, defined as the leg of a product’s journey in which it arrives at the buyer’s door, accounts for 53% of the total cost of shipping for retailers, per Honeywell. And we expect the cost of e-commerce returns to skyrocket from $143 billion in 2018 to $348 billion in 2023.
  • Retailers can slash these costs while boosting sales by offering buy online, pickup in-store (BOPIS) and buy online, return in-store (BORIS) omnichannel services. BOPIS and BORIS strategies enable firms to eliminate both last-mile delivery and return-shipping costs while also increasing sales. Eighty-five percent of shoppers have made an additional in-store purchase when picking up an order they placed online, per Doddle, while 53% of consumers buy additional items when they return items in-store, according to a Bell and Howell study.
  • Consumers are also increasingly turning to — and expecting — BOPIS and BORIS services when shopping online.
    • BOPIS is seeing high adoption because it helps consumers avoid shipping fees, get items faster, and see items in person. Over half (56%) of all shoppers were aware of BOPIS in 2018, while 70% had already tried it, according to the NRF. And of those who’ve tried it, 64% say it’s because BOPIS eliminates delivery charges, while others say it’s due to faster fulfillment or the ability to see an item before taking it home.
    • Although consumer adoption of BORIS isn’t as high, we expect it to begin picking up. Only 13% of consumers have used BORIS, despite 40% thinking that using the service is easier than shipping returns, per Narvar. However, 40% of consumers say they wouldn’t buy an item online without the option to return in-store, according to a study by Foresee, so we believe BORIS is growing in importance and will see greater consumer adoption going forward.
  • The benefits BOPIS and BORIS provide to both retailers and consumers will spur retailer [...]