Assessing impacts of introducing ship‐to‐store service on sales and returns in omnichannel retailing: A data analytics study

Abstract

Omnichannel retailing features, such as ship‐to‐store (STS) service, are designed to deliver a seamless shopping experience for customers. For a retailer, introducing omnichannel capabilities requires major investments to integrate physical stores and online marketplaces, yet holds a promise of potentially enhancing revenue streams from both brick‐and‐mortar (BM) stores and online store channels. We assess the promise of ship‐to‐store capabilities by analyzing transactional data from a national jewelry retailer to study impacts of introducing ship‐to‐store on a retailer's operating performance, in terms of sales and customer returns. Contrary to expectations, the findings show that online sales decreased after ship‐to‐store was introduced, although BM store sales increased. Detailed analysis of the transactional data suggests that, after STS implementation, some customers switched from the online channel to the brick‐and‐mortar channel. This switch occurred mainly for high‐value purchases. The customers who actually remained with and fully completed a sale using the ship‐to‐store service typically were those that bought low‐value items. Our findings also suggest that introducing ship‐to‐store increased cross‐channel customer returns of online purchases to physical stores. Concurrently, these new ship‐to‐store returns generated additional BM store sales. The paper contributes by showing how introducing ship‐to‐store service can have different impacts in terms of sales and returns across a retailer's channels.

Development and validation of the pick-up service quality scale of the buy-online-pick-up-in-store service

“…They also showed that offline store characteristics (i.e., store density, product variety, competition) moderate these benefits of BOPS on purchase behaviors. Studies from the operational perspective indicate that BOPS implementation positively influences store traffic and offline store sales (Gallino and Moreno 2014;Gao and Su 2016;Akturk et al 2018). Moreover, Jara et al (2018) suggest that accurate stock-out information, dual experiences of website and pick-up service, and pleasant interactions with employees can create long term value for BOPS customers.…”

Satisfying consumers all around: a multidisciplinary view of omnichannel retail

“…Retailers also offer the buyonline-pickup-in-the-store (BOPS) functionality allowing consumers to buy products online and pick up in stores (Gao and Su, 2017b). BOPS is also named as ship-to-store, buy-onlineship-from-store (Serkan Akturk et al, 2018). Sending mobile messages about online promotions to offline consumers, offline-to-online targeting helps to induce consumers to shop online (Luo et al, 2020).…”

“…5. Research opportunities for future research 5.1 Research opportunities for information systems Current studies regarding IT in omnichannel research have suggested some potential topics (Luo et al, 2020;Serkan Akturk et al, 2018;Song et al, 2020;Zhang et al, 2019). First, it is suggested that the design and configurations of omnichannel technologies deserve further attention.…”

“…Zhang et al (2019) also suggested investigating how pop-up stores affect online and offline sales of traditional omnichannel retailers would be interesting. Serkan Akturk et al (2018) proposed that the moderating role of product category on the impact of the ship-tostore implementation. Song et al (2020) suggested it would be rewarding to investigate whether the online and offline sales expansion effect of BOPS also presents for hybrid retailers.…”

“…calls for research on how to design content of geotargeted text messages. SerkanAkturk et al (2018) points out that future research should explore how the lead time of ship-to-store influences omnichannel consumer behaviors. SerkanAkturk et al (2018) also calls for more research on contrasting ship-to-store against BOPS and their hybrids.…”