Why Pickup Points Are the Future of Ecommerce Delivery
Pickup points are becoming the delivery option of choice, yet many retailers are still without this option for their customers. We cover why retailers need to embrace the shift in ecommerce to futureproof their business.
The majority of carriers jumped onto the pickup point trend, building their network of pickup points, all with their own names, from their associated Out Of Home (OOH) delivery services, for example:
- UPS launched Access Points
- Hermes/EVRI launched ParcelShops
- DPD launched Pickup Points
- Royal Mail launched Local Collect
- Fedex launched Hold at Location
- DHL launched Service Points
- Inpost launched Lockers
Where is the inspiration coming from? Delivery aggregation or ‘drop density’. By consolidating package drops into one location, rather than going to individual addresses, carriers could offer their customers – the retailers – discounted shipping rates – which they could choose to pass on to their customers, making them more competitive where high delivery costs are a factor to abandon cart.
America: where pickup points are on the rise
Shoppers are looking for more convenience and security, PUDO is here to stay. In fact, according to OnlineDasher, there was a 66% increase in online shoppers adopting the delivery solution in 2022.
Europe: where pickup points are the norm
In Europe, the idea of pickup points is very much embedded in the culture. Home delivery is often positioned as the primary choice. However, the usage of collection points in Europe emerged during the pandemic and is here to stay.
So why aren’t you offering pickup options to your customers yet? Let’s remind ourselves of the benefits first…
Reasons to offer pickup points when selling online
Increase revenue from a cheaper shipping option
Our customers report conversion uplifts of between 3-5% at the shipping method stage when adding pickup points as an option. This can equate to over 1% of new sales from new customers. So, take the example of a £100m business – that’s a lot more revenue, simply by adding a cheaper shipping option.
Cheaper shipping decreases cart abandonment
Another study found that 48% of US online shoppers have abandoned a cart in the last three months because “I was not satisfied with the delivery option/price”
By consolidating home deliveries into larger drop offs, carriers have no choice but to charge less – which means that retailers can reduce what they charge for delivery. This in turn can:
- Reduce shipping costs as a contributing factor for cart abandonment
- Increase AOV (average order value) when offering free shipping on a minimum order value
First delivery attempt success
Shoppers using pickup points are often the ones who miss deliveries request updates or have delivery anxiety. Retailers offering this solution see a far higher first time delivery rate, less re-delivery costs, lower handling and returns costs, reduced instances of fraud (related to the rise of package thefts) and less WISMO requests and complaints.
A free signed-for service reduces anxiety
Those shoppers spending more online are reassured by pickup points. It takes away the anxiety of whether they’ll be home, and removes the stress of having to double check whether they’d agreed a safe place with that particular carrier. Fact: offering a pickup point option results in lower cart abandonment rate, particularly from those shoppers with high value baskets. Pickup points are effectively a free, signed-for service.
A more sustainable solution
Sending a package to a pickup point is the easiest way to lower the carbon footprint of the delivery. When a shopper chooses local pickup, drivers can deliver multiple packages to one place and cover fewer miles compared to driving from one home to the next. Missed deliveries are eliminated, along with the need to attempt second or even third deliveries, all of which create extra CO2. Read how pickup software creates Greener Shipping.
The Benefits of Pickup Points for ecommerce
The key to enhancing the customer experience is understanding their needs. Home delivery can be problematic unless you have a concierge service. Customers may face issues if they switch from working remotely to working in the office, or if they haven’t specified a safe delivery location. Home delivery can be inconvenient, and many shoppers prefer alternatives.
Pickup points address these challenges. They offer flexibility for those who can’t guarantee their availability for home delivery or who want more control over their pickup schedule. This is particularly beneficial for:
- Out-of-home workers: Those who are frequently away from home.
- Shift workers: Individuals with irregular hours.
Why is this important? Pickup points cater to these needs, offering a solution that fits diverse schedules and preferences.
By offering pickup points, retailers can enhance customer satisfaction, reduce missed deliveries, and provide a more flexible delivery option that meets modern consumer demands.
Diversify Your Delivery Options to Enhance Customer Experience
It all starts with considering the customer journey. You aim to offer a mobile-friendly website, fast-loading pages, and product pages with clear information. Delivery options should follow the same logic.
Home delivery requires customers to predict their availability on an unknown future date within a narrow delivery window. For standard delivery (2-4 days), it’s nearly impossible to guarantee someone will be home.
Pickup points solve this issue. They offer flexible options that cater to any schedule, providing ultimate convenience for customers.
The Evolution and Adoption of Pickup Points
Some retailers have offered pickup options for over a decade, but widespread adoption has lagged until recently. Why? Two main reasons:
- High Costs for Bespoke Software: Larger retailers have significant development budgets, vast IT resources, and lengthy timelines to develop and launch their products in line with carrier requirements.
- Lack of Expertise: Carriers lacked the tech, infrastructure, and industry know-how to build pickup options into their solutions. This left retailers without guidance or support, resulting in minimal adoption.
Overcoming Barriers to Pickup Software Adoption
Integrations:
HubBox software is compatible with an extensive range of ecommerce platforms and technology stacks, including Shopify, Magento, Salesforce, BigCommerce, WooCommerce, custom-built sites, and more.
Solution:
As well as the software, HubBox’s team are experts at delivering pickup solutions and are on hand for retailers to guide them through the implementation of a pickup network through to driving the return on investment from a pickup solution.
HubBox – why every retailer should offer pickup points
I’m interested. How easy is HubBox software to use?
Want to improve your margins, offer a reliable delivery option and decrease your carbon footprint at the same time? Book a demo today.
