Customers of Toys"R"Us often make purchases on the company website and then to go to a store to collect their goods – the Buy Online, Pick up in Store principle. Now the toy retailer is also offering a service which allows customers to order online but then go to a local store to view and pay for the items, which will subsequently be delivered to their home from a central warehouse. This is the ‘Pay in Store’method.
If retailers are going to adjust to the new environment and keep in tune with their customers, they ought to be moving progressively towards a totally ‘omnichannel’ strategy. Among the most common new practices is the ‘Buy Online, Pick up in Store’ approach – a concept widely known as ‘Drive’ in Continental Europe – which means that customers order online, then go to pick up their purchases in their own vehicle. Toys"R"Us has now added a new variant to its omnichannel offering, dubbed ‘Pay in Store’. This service also entails ordering online, but the customer then goes to the store to pay for the goods, which will later be delivered to their home. The idea is to attract customers who do not have credit cards or are reluctant to pay online, but who are nevertheless keen to do their shopping online. The service is available for all orders made on Toysrus.com and Babiesrus.com sites in the United States, where 873 physical sales outlets are participating in the initiative. Now, when shopping on the sites, customers can simply select ‘Pay in Store’ from among the payment method options displayed at the online checkout. Their order is then reserved, and they can visit their local "R"Us store to pay within 48 hours of receiving their confirmation e-mail. Once payment is made, the order will be processed and the goods delivered to the customer's home.
Allaying the anxiety of paying online
Maxence Dislaire, CEO of Improveeze, a company providing interactive and online solutions for retailers, believes this could be a promising initiative. “Offering multichannel ‘web to store’ payment mechanisms fosters online commerce and provides the customer with a better shopping experience,”he told L'Atelier. However, this service is not yet widespread among retailers. The reason might be that “many stores haven’t yet adapted their infrastructure sufficiently to integrate the 'web to store' channel, i.e. choosing online and paying at a store.”In addition, many companies are still at the stage where they regard each bricks-and-mortar store as a separate profit centre in its own right, and tend to work on the basis that each profit centre, whether physical or virtual, should have its own turnover targets and results. This approach is however becoming less hard and fast as retailers begin to grasp just what the multichannel concept is all about.
Pay in Store feasible for most retail items
“E-marketing forces major brands to adapt their physical sales outlets to the needs of their customers. ‘Pay in Store’ is a good way of smoothing out the effects of ‘showrooming’ (where customers visit bricks-and-mortar stores just to look before buying online) and helps them to manage stock with a view to lowering costs,”explains Maxence Dislaire. He believes this approach can be used for all products that can be sold both online and in-store. This service could even help to sell more of certain types of products – in the luxury goods sector, for instance, where customers might be reluctant to buy expensive products online, and ‘Pay in Store’may serve to allay any fears. He points out that“the sensory impact of owning a luxury item is actually just deferred, as the customer can view and handle the product when s/he goes to pay for it. This may well allay the anxiety of the purchase decision.” This is perhaps especially relevant as, should the product turn out to be unsuitable, the customer can simply “return” it on the spot – i.e. decide not to pay and let the order expire. "In future, retailers will need to think about incorporating this channel into their overall strategy, but between now and then let’s wait and see the what sort of results this new service achieves,” concludes Maxence Dislaire.