More web merchants are planning to offer free returns and in-store pickup of online order this year, suggest new survey data from Internet Retailer. If so, that would represent a departure from the fulfillment and delivery strategies of most major online retailers.
Less than 10% of the Top 500 retailers offer free return shipping. That list includes Target Corp. (No. 18), Kohl’s Corp. (No. 26) and RueLaLa.com (No. 76). About a quarter of the Top 500 retail chains allow store pickup of web purchases, and only five merchants in the Top 500 Guide offer both.
However, those numbers could increase in 2014, as survey results from a recently completed Internet Retailer poll that focused on fulfillment and delivery trends show that 17.6% of respondents plan to institute free returns in the coming year. 12.7% of respondents plan to set up buy online, pickup in store programs.
FREE SHIPPING CHALLENGES
While free shipping is relatively common, the leading challenge for e‑retailers on the fulfillment and delivery front in 2014 seems pretty clear, experts and merchants say.
“Even though customers prefer free shipping, they are expecting delivery times to be faster every year,” says Greg Dahlstrom, director of global logistics for Vitacost.com Inc., No. 87 in Top 500 Guide. “The challenge is to optimize delivery networks in a way so that we can continue to provide free shipping but get it to the customers more quickly.”
This challenge was especially apparent in the recently completed holiday shopping season; a surge in online orders in the final days leading up to Christmas overwhelmed the ability of some retailers and delivery services to get items to consumers by Dec. 25. Nearly a third, 32%, of the top 25 North American e‑retailers by sales didn’t get all orders under the tree by Christmas Eve, even though consumers placed the orders before the merchants’ stated cut-off dates.[Source: "Internet Retailer Top 500 Guide." Internet Retailer. 21 Jan. 2014. Web. 24 Jan. 2014.]