Lower service fees is the top reason shoppers choose grocery pickup over delivery. In fact, half of grocery customers polled in new research from Mercatus and conducted by Brick Meets Click said they would choose next day delivery or longer if they could pay even lower pickup fees.
“We know that many grocery customers consciously opt to use pickup and avoid using delivery because of all the explicit and additional costs,” said Mark Fairhurst, VP marketing at Mercatus. “It turns out that by giving customers a choice about the cost they’re willing to pay to use pickup, retailers also gain the opportunity to lower the cost-to-serve aspects of online shopping for both themselves and their customers.”
Of the consumers surveyed, 60% of those U.S. households used pickup services during the past 12 months, more than 70% of customers got their orders while staying in their cars, and almost 50% of consumers said they used the retailer’s app to inform the store of their arrival at the designated pickup location.
The research also measures consumers’ level of satisfaction around order wait time. The longer customers wait for their orders, scores drop consistently and significantly, the research indicates. Satisfaction levels range from 81% for under a 2-minute wait, to -38% for more than 10 minutes. On average, customers said that their wait time lasts between 5-6 minutes. Use of mobile apps during check-in received a score of 67% satisfaction, in comparison to other methods that were not as quick or easy to use.
“Since time is money, a structure that flexes fees based on when someone picks up an order benefits both customers and retailers,” said David Bishop of Brick Meets Click, who conducted the research for Mercatus. “The findings highlight that paying less is more important than receiving the order as fast as possible. The tradeoff that the customer makes means the retailer can realize significant labor savings by batching out more orders together during the assembly stage,” Bishop said.
Preferring lower pickup fees is consistent across all age groups, according to the research. However, not wanting to wait around for a delivery resonated most with the 30-44 age group.
“When it comes to pickup, linking order staging readiness with geolocation notifications triggered automatically by the retailer’s branded mobile app is an effective way to streamline the pickup experience into a faster, hassle-free experience,” explained Sylvain Perrier, president and CEO, Mercatus. “Shorter wait times at pickup can have a dramatic effect on customer perception and brand affinity, and will go a long way to encouraging repeat customer behavior.”
The research from the Mercatus Digital Commerce platform was conducted by analytics and strategic insight firm Brick Meets Click via a survey online of 1,828 U.S. adults, 18 years and older, from August 25-27. This research and related report, Omnichannel Shopper Behavior Report (OSBR) 2022-Volume 2, are the second in a three-part series.