What is BOPIS (Buy Online, Pickup in Store) in Retail?
11 Min Read
Written by: Parcel Pending
By now, you’ve probably noticed many retailers offer a buy online pickup in-store (BOPIS) service. If you’re a retailer who is considering implementing this feature as a checkout option or a customer looking to take advantage of this offering, it’s beneficial to understand exactly what BOPIS is, how it works, and how it can make shopping easier and more convenient.
In this article, we’ll break down exactly what BOPIS is, how BOPIS works for a customer, and explore some of the different BOPIS models retailers are using to help streamline and improve the customer experience.
Buy Online Pickup In-Store, Explained
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: buy online, pickup in–store. A BOPIS option allows a consumer to make a purchase online and pick up their order in-store. The order can be picked up in several ways: from a designated customer service or BOPIS pickup area, curbside pickup, or even using BOPIS retail lockers.
Customers can find out if a retailer offers BOPIS by checking for additional shipping options during online checkout. If BOPIS is available, a consumer can add items to their cart online, select in-store or curbside pickup, and complete the rest of their checkout process normally. When the order is ready for pickup, the consumer gets a notification and can pick up their order at their convenience during the store’s business hours.
It’s important to note that, in order to provide a BOPIS option for customers, retailers must have both an online and a physical storefront. In other words, BOPIS usually isn’t available for online-only stores.
How Does BOPIS Work for Customers?
If an item is in stock at a local store and a customer wants to pick up their order at that store, a store associate will receive the order, retrieve the item or items, then prepare the order for pickup. Stores are typically able to process order fulfillment in 1-3 hours. If an item is not in stock at the local store, the customer can choose to have their item/items shipped to that store, though that customer may have to wait a few days until their order is ready for pickup.
When the customer arrives to pick up the order, they can experience one of several BOPIS options depending on the store. Some retailers provide curbside pickup, where customers park in designated parking areas near the store entrance, and a store associate brings the order out to their vehicle. Other stores may require customers to pick up their order inside the store by visiting the customer service desk or by using BOPIS retail lockers.
What are the Advantages of Providing BOPIS?
Brick-and-mortar retailers have been steadily innovating their online storefronts and service offerings to make them a more integrated part of their customers’ shopping experience. As a matter of fact, BOPIS services were developed to give retailers an additional way to compete with fast-fulfillment eCommerce retailers, many of whom could ship items next-day to customers. In particular, this service benefits retailers who are not able to offer the same expedited, free shipping options that online retailers and logistics providers do, as the overhead costs often prove prohibitive.
One of the most important benefits of offering BOPIS is same-day order fulfillment. Because customers are looking for convenience and speed in their online shopping experiences, they want a shopping experience that is as convenient and frictionless as possible. In other words, online shoppers are looking for a shopping experience that offers as close to instant gratification as possible. BOPIS does just that.
This makes BOPIS options particularly important for brick-and-mortar retailers, though online grocery shopping and the future of grocery retail will be impacted by these services as well. Most importantly, BOPIS services help retailers blur the lines between the digital and the physical, ultimately helping retailers to provide a more seamless shopping experience. And now, in light of the pandemic, this service provides even greater advantages like contactless delivery, which provides added safety and security for customers and grocery store associates.
Beyond the impacts of the pandemic, retailers can realize a number of other important benefits by leveraging buy online, pick up in–store:
Reduced Last-Mile Shipping Costs
First, understand that last-mile shipping costs represent a significant expense for retailers. What this means is getting items to a fulfillment center costs far less than getting that same item from a fulfillment center to a residential address. However, last-mile shipping costs could be significantly reduced or avoided altogether 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 Store Traffic
There’s a second key advantage for retailers that offer BOPIS shipping options. BOPIS, by its very nature, brings the customer into a physical store. While the name of the game for BOPIS is greater convenience, it also significantly increases foot traffic within the store itself. This is a big boon to brick-and-mortar retailers who are looking to find effective methods for increasing the number of customers that are walking (and shopping) their aisles.
Integrated Inventory Management
There are many important ways that BOPIS is changing the way that retailers do business. Another advantage for retailers worth mentioning is that BOPIS has fundamentally shifted the way many retailers utilize their inventory.
For example, in order for BOPIS to function correctly, retailers have to merge their in-store and online inventory tracking system. This has had an impact not only on how retailers fulfill all orders–regardless of whether they were purchased online or in-store–but has also improved the way that customers can find the items they want.
Prior to the adoption of BOPIS services, retailers had two different inventory systems: one for fulfillment/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 store 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. This has caused ramifications far beyond simply allowing people to pick up items in-store.
Now, if an item is out of stock at a distribution center, a store with the item in-stock can fulfill the order from store inventory and ship the item directly from that store. This change has greatly benefited consumers by giving them access to more of a retailer’s inventory and significantly reducing the chances that an item they want is out of stock. At the same time, retailers have benefited because merging these two inventory management systems has given them a full-field view of their entire inventory, at all times. This allows them to capture a greater share of online sales, while also allowing them to offer convenient customer-facing services such as BOPIS.
Faster, More Flexible Order Fulfillment
For customers, the advantages of BOPIS are more than enough to keep them using the service. The first, and arguably most important, is speed. BOPIS allows customers to receive their item or items much faster than they would by choosing home delivery. This is especially true if the item is physically on the shelves of their preferred or local store. In these situations, customers can pick up their items within a matter of hours instead of waiting several days like they would with a retailer who only provides home delivery services. BOPIS options are also convenient because they give the customer flexibility in how they shop. They can place an order via online shopping, then pick up their item on their lunch break or during a quick stop on the way home after work.
Secure Order Pick-Up
Lastly, customers will have greater peace-of-mind knowing that their item will be safe, secure, and in-stock 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. As online shopping has increased, so too have instances where packages are stolen right off of a customer’s doorstep. This problem is so commonplace that many people are enhancing their home security systems with outward–facing cameras to capture video of package thefts in the act.
What are the Downsides of BOPIS and BOPIS Alternatives?
Although the BOPIS trend may seem to only offer advantages, this isn’t quite the case. While much of the recent emphasis in the news has been on popular retailers shifting to offer BOPIS services for their customers, there are other alternatives on the horizon that offer improvements for both retailers, shippers, and consumers. One of the challenges that all three of these entities face is getting packages to the customer as fast as possible.
Impact on Store Efficiency
For retailers, BOPIS eCommerce still requires a significant labor investment to accomplish. Most stores that offer this service must train and designate staff specifically to fulfill orders for in-store pick-up. At the same time, staff is increasingly tasked with fulfilling online orders for shipment to at-home customers rather than in-store customers, causing them to have to split their time between supporting these varying customer needs. In the end, this offering can represent a significant source of overhead for retailers.
In addition to the need to designate specific staff to fulfill BOPIS retail orders, a second downside is that not every retailer can offer in-store pickup. For instance, how can online-only retailers offer a service with a similar level of convenience to BOPIS if they don’t have a physical storefront? One alternative is to utilize parcel lockers. Some retailers, such as Amazon, have been testing the waters on this front, allowing customers to purchase an item online and pick it up from an Amazon locker at a nearby retail location (such as Whole Foods or Kohl’s). This offering is beneficial for customers that want the added security and convenience that BOPIS offers.
In its current implementation strategies, BOPIS retail also has some disadvantages for consumers as well. While convenience is the main reason this service has become so popular, this convenience is often offset by how long it takes to actually pick up an order. For many retailers, BOPIS orders must be picked up at a customer service desk. This is usually the desk where returns are processed, which can lead to significant wait times while store associates juggle these two tasks; in fact, a recent time study revealed that BOPIS shoppers believe that in-store order pick-up takes 2-5 minutes. Curbside pickup faces a similar challenge: while the customer never has to leave their vehicle, customers believe that online order-pickup takes 8-12 minutes – a lifetime for today’s time-pressed consumers.
Retailers can also experience some difficulty in combining the online and in-store shopping experience. For example, if you make a purchase online and choose an in-store pickup option, but later realize you need to add items to your order, it can be unwieldy to pick up your online order and then proceed to go grab additional items. The inconvenience of running your payment method twice, or waiting in two lines, can sometimes offset the convenience that BOPIS is intended to provide.
Enter Buy Online, Pick-up in Locker (BOPIL)
One way that some retailers are choosing to address the deficiencies in BOPIS is by utilizing retail parcel lockers in store. Enter BOPIS retail lockers, like Buy Online, Pick-up in Locker (BOPIL®) by Parcel Pending.
BOPIS retail lockers, at their core, are a new way for brick-and-mortar retailers with an online presence to offer convenience for their shoppers. What sets BOPIL apart from other shipping services that have emerged in recent years is that it represents a new type of fusion between a store’s online and physical storefronts. It does so by creating a more frictionless shopping experience that collapses the boundaries between making a purchase online and in-store. This is the reason why major retailers, like Lowe’s Home Improvement, are looking for smart locker solutions to provide greater convenience for customers while not compromising on-brand experience.
“With more than 60% of online orders picked up in our stores, [the lockers] gives customers one more option and the added convenience and flexibility to control how and when they get that order,” said Joe McFarland, Lowe’s Executive Vice President of Stores, on their decision to partner with Parcel Pending to offer in-store pick-up via smart locker for their customers.
Order pick-up with BOPIL is simple and safe:
- The customer places an order online either through the website or mobile app.
- Using real-time inventory information, retailers’ sites inform customers about available store pick–up options.
- A store associate picks and packs the order.
- A store associate delivers the order into the locker.
- The customer is notified that their order is ready for pick-up.
- The customer comes to the store and collects their order at their convenience. Note: order pickup with BOPIL typically takes less than 30 seconds.
- Lockers also support contact-free returns, a process that also takes less than 30 seconds for a customer to complete.
BOPIL eliminates the need for individuals picking up orders to wait in line at the customer service desk, while still offering the same level of security and an even greater level of convenience. This added convenience creates a more frictionless shopping experience for customers.
Additionally, in light of the impact that last-mile shipping fees have, alternatives like Buy Online, Pick-up in Locker (BOPIL) offer a way to minimize last-mile shipping costs while still delivering convenience. By having retailers (both online and brick-and-mortar) funnel multiple orders through one store pickup location, BOPIL helps retailers realize significant savings on last mile delivery costs.
BOPIL also allows retailers to streamline their staffing even further, giving store associates more time to focus on providing excellent customer service. While it is clear that BOPIS has been increasingly popular over the past few years, expect to see more retailers build on the popularity of in-store pickup by offering services like BOPIL. Check out our related article, BOPIS vs BOPIL, to learn more.
While BOPIS is an attractive option for online retailers that have no physical presence, many brick-and-mortar retailers are adopting parcel locker services to house purchases made online for pick-up in-store. The advantages of offering these services are numerous, including reducing labor associated with order preparation and handoff, as well as streamlining the process from end-to-end and improving last mile logistics.
The explosion of retail stores offering in-store pickup services clearly demonstrates that this is one of the many omnichannel trends that is here to stay. The next time you need to make a quick trip to your favorite retailer, consider instead making an online purchase and picking it up in the store. You may be surprised at the convenience this service offers you. With exciting innovations to BOPIS on the horizon, including Buy Online, Pick-up in Locker, the convenience of in-store pickup options will only continue to increase as the process is improved. For more industry insights and additional ecommerce predictions, check out our other retail blog posts.