U.S. department stores have been stepping up their omnichannel efforts with in-store returns and pickup, but their counterparts in Europe are still far more developed. A main difference is that U.S. brands have prioritized returns, whereas U.K. brands have given click-and-collect just as much attention. Ninety-five percent of U.S. department stores accept in-store returns for online purchases vs. just 89% in Europe. But 78% of European brands offer in-store pickup of online purchases vs. just 43% of North American brands, according to L2’s Insight Report on Retail Innovations.
The good news for U.S. brands: there are a lot of mistakes to learn from. Savvy, forward-thinking brands can use Europe as a research ground for omnichannel pain points and potential workarounds. For example, unavailability of ordered items, long waits, and staff inability to locate items were among the top concerns of European consumers who used click-and-collect in various stores. In response, Argos (which fills 63% of its orders via click-and-collect) created a hub and spoke network with 150 “hub” warehouses that served four to six small “spoke” stores each. Studying this model could be especially helpful to U.S. department stores as store closures rise. Since many are using store locations as warehouses to ship from, replacing closed stores with smaller spokes in the area could be especially helpful. Kohl’s is already experimenting with this model, and has announced plans to test five to ten smaller stores this year.