Do you really know your customers? How package collections target the unexpected

31 May 2023
Jenny Molloy

In this article, we dig deeper into who’s using pickup points – and why, as an online retailer, it’s time to meet the rising demand for the out of home trend.

Out-of-home deliveries are on the rise, with growth in shoppers choosing pickup points in the US forecast to grow 19.4 percent compared to the previous year. The rise in popularity of purchasing products online and picking them up in-store boomed during the first point of the pandemic and are set to grow, albeit at a more steady rate, given the increase of omnichannel shopping. As a result, it’s more important than ever to offer customers flexibility, convenience and choice.

What are the benefits of customer collection?

In a nutshell, the benefits of having the customer collect their packages at a place other than their own residency or business address include:

  • Flexibility: plenty of convenient locations to choose from near home, workplace or shopping
  • Security: packages stored in a safe, secure location, avoiding doorstep theft
  • Accessibility: pickup locations are typically accessible, open long hours and hold packages for 7-14 days
  • Fits with daily life: no more missed deliveries or trying to be in when a package arrives 

Reduced shipment charges: for retailers and consume

Who uses pickup points?

Think it’s just millennials that love to collect out of home? The fact is: all of us that shop online can benefit from the convenience and flexibility of having pickup points in our lives. With more people shopping online than ever before, providing options and choice to anyone who may be a potential customer is more important than ever.

Pickup points are essential to everyone (at least some of the time).

While there’s certainly some fascinating data around who’s using pickup points (more of this below) the fact is: most of us need to use pickup points at least some of the time. Regardless of our age, our income, the types of things that we’re ordering online: we can’t all commit to being home to sign for a delivery. If we can’t be sure that we’ll be around to sign, and no other delivery options are available, we may abandon the cart, and head to a competitor that can give us the convenience we’re looking for.

Pickup points for out of home workers  –  don’t assume everyone has flexible working options

While 58 percent of Americans have the opportunity to work from home at least one day per week, that leaves 42 percent that don’t have any flexibility at all. Those on the road, working in hospitals, in schools and on trade sites are excellent candidates for out of home delivery. Giving workers the option to collect their package once they’ve clocked off doesn’t just keep them loyal to your brand – it makes them more likely to spend more. For example, Doddle reports that 97% of merchants reported an increase in average order value after adding out of home delivery options.

Customers are getting tired of late deliveries and are open to alternatives

According to research by Doddle, a whopping 61.5% of online shoppers experienced delivery issues around the 2022 Christmas shopping window. In the same survey, 21% would be less likely to receive deliveries at home in future, with younger shoppers making up the bulk of those looking to change their habits. That’s an alluring stat for retailers who seek every sliver of opportunity to gain an edge over their competitors.

The more expensive the item, the more likely your customers will use a pickup point – it’s like a free signed-for service.

Who’d risk leaving the delivery of an expensive piece of jewellery to chance? An expensive jacket being left in plain sight or at risk of being ‘accidentally’ taken in by a neighbour? The rise of porch pirates – that is, opportunists swiping packages that have been delivered by the carrier – costs an annual amount nationally, estimated at $19.5 billion. No wonder that the average order value of items for pickup can be up to 100 percent higher than those going down the traditional home delivery route. Why? Because the higher the value of your customers’ basket, the higher the anxiety. There is a direct correlation. The pickup point removes the fear of an item being stolen or misdelivered. It’s time to educate your customers of this huge benefit: pickup points are essentially a free signed-for service.

Package collections are used by younger shoppers, but older generations are being drawn in by the benefits

The latest data reveals that younger shoppers are the most comfortable using pickup points, with older generations less likely to opt for local pickup options. This data is unsurprising when we consider that Millenials and Gen Z’s are digital natives and may prefer to opt for online delivery over bricks and mortar shopping. That said, retailers would be naive to assume that those in the senior demographic are sceptics: in fact, when it comes to shopping online, this generation has been embracing online shopping at an accelerating rate. Yes, lockdown made online purchases a necessity, but the convenience now makes it a conscious choice.

Those on lower incomes are more likely to use pickup points 

A recent survey shows that workers with lower incomes, Hispanic adults and those without a college degree are among the most likely to say they rarely or never work from home. Therefore pickup points, which offer a cheaper delivery option at checkout, as well as the flexibility to collect when the worker is not at home, give retailers a way to ensure inclusivity with all shoppers, regardless of earnings or working patterns.

Collections for discreet shipping: because not everyone needs to know what’s inside the box

Package collection points make it so much easier for customers to keep their purchases under wraps. Nothing ruins a birthday surprise like the recipient having to sign for their own gift. By allowing the sender to collect a package you mitigate the worry that their partner/child will spot what’s in the box. 

Pickup points also have a valuable role to play in providing peace of mind over delivery of items that some might consider controversial: botox, medications, sex toys – these are usually placed in plain packaging for these very reasons, but pickup points add an extra layer of confidentiality by removing any questions about packages coming to the house. 

Understanding your clients’ needs for package collection

What are you customers’ thoughts around out of home delivery? Do they want it? All the  evidence points to an overwhelming yes – when they’re given the choice.

Brands that offer flexible collection options are getting a great response

Unsure whether your customers would appreciate having greater flexibility around package collection? According to research by Barclays, out of home deliveries now account for 40% of sales for retailers who offer the service, making it an exciting growth market for retailers that invest at this relatively early stage. In terms of the overall market, local pickup will account for almost 11% of UK online retail sales by 2025, according to new research. It’s a fast growing space, but it’s certainly not a saturated one, making this year an exciting time to spearhead your firm’s omnichannel shopping journey.

Customer negativity associated with missed home deliveries is overwhelming

If you’ve ever looked at the Facebook groups dedicated to criticizing carrier services for their perceived incompetence, then you’ll be fully aware how much customers hate missed deliveries. Both carriers and retailers get a hard time unraveling the pieces of the puzzle, leading to frustration on both sides as customers share their ongoing discontent. Why put up with it any longer? Offering pickup points is a simple and cost-effective way to relieve the administrative, logistical and financial burden associated with package delivery.

Customers expect greener ecommerce – so make sure to give them the choice 

Whether your customers are environmentally conscious or indifferent: it doesn’t matter. Green retailing is about more than simply putting items in appropriately sized boxes and using compostable packaging. They expect all that already.  It’s about giving customers extra choice so that they can further flex their green credentials if they want to. 

Pickup points reduce the number of delivery trucks on the road by consolidating multiple drops into a single pickup point, and can further reduce carbon emissions by reducing the need for additional redelivery attempts, making it a greener shipping solution compared to home deliveries. Offering pickup points, and educating your customers about their sustainability benefits, provides the choice that customers are looking for.

How to offer a Pickup points?

HubBox provides software that makes it easy to give retailers pickup options their customers will find easy, convenient and flexible. With functionality designed specifically for the needs of both retailers and carriers, it is simple to set up and use. Working with the likes of UPS and DPD, it provides software for retailers to launch local pickup options at checkout. Find out more at HubBox or to see the software in action, book a demo.