January 20, 2009
Sears to Test New Online/Drive-Through Concept
It’s
becoming increasingly common today for retailers to offer store pick-up
as an option for consumers ordering product online. Sears Holdings is looking
to take the convenience factor associated with online ordering and store
pick-up one step further with a new warehouse store concept called MyGofer that
gives consumers the option of taking delivery of their order at a drive-through.
The
first MyGofer is slated to open this summer in Joliet, Ill., according
to a Chicago Tribune report. Some see the move by Sears as a means
to cut operating expenses while others view it as a step by the company
to reconnect with its heritage as general catalog merchant.
The
85,000-square-foot MyGofer will have about 80 percent of its space devoted to
storing product. The other 20 percent will consist of a showroom.
"It’s a big, big
opportunity to restructure the company," Love Goel,
chief executive officer of Growth Ventures Group, told the Trib. "You
can get a lot more inventory in the store, and it’s much cheaper to operate
because you don’t need as much lighting and staff. It’s a much more productive
use of real estate."
Joliet officials indicated
that Sears expects the MyGofer store to cost
up to $5 million to build and that it will generate greater sales volume
than the Kmart it will replace.
Discussion Question:
What do you think of the MyGofer or similar
concept for Sears or other retailers?
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MyGofer doesn’t sound too different from other site-to-store concepts, nor much different from the ability to pick-up scripts at the drive-thru. That said, I give Sears props for attempting to increase shopping convenience, for further merging its buying channels and for innovating during a recession. The MyGofer details are obviously sketchy right now, but given what we know, it sounds like an offering that will appeal to today’s shoppers, i.e., shoppers who are increasingly multichannel buyers.
Retailers must follow their lead by ensuring that customers have access to true cross-channel integration. I hope Sears succeeds. And I hope more merchants noodle new ways to reach the multichannel shopper.
Fix the assortment and branding first. (And spend some money on the insides of the stores.) Without the right merchandise content, it doesn’t matter whether Sears adds more convenience to a formula that isn’t working.
Is this a bona fide solution to time famine, instant gratification and better merchandising? Maybe, though it will depend on Sears’ ability to generate trial, re-craft meaningful customer relationships and out-deliver Amazon.
While this is innovative, interesting and opportunistic, it also seems a bit desperate. When it comes to “low-friction” retail, Amazon will continue to rule.
MyGofer is a good concept for Sears and I believe the potential for success is as good as Sears’ ability to execute the process well, and that’s where my skepticism comes into play. Sears has a history of creating new ideas but not executing them as well as the next player coming into the market. We shall see.
There are three questions here. Will it be faster and easier for the customer to pick up stuff at the store than at a regular store? If so, why is it taking so long to pick up the goods at the regular store? The first thing they need to be doing is just make it easier and faster for customers to get in and out with the online purchase at their regular stores.
The second question is will people coming to pick up merchandise go in and wander around the 20% of the store that is set up as a show room and then take the time to purchase the items?
Third will customers look at this as not only a pick up point but also as a place to shop? If that idea works than it is a good idea and a way of opening a new location with lower overhead. As stated above, all of the stores that were using this concept went out of business.
Will it be profitable? Will there be enough business generated that they can make it work? I certainly see the benefit of not having to maintain a pretty store and it will work great for things like appliances and furniture or small appliances, etc. The key is getting customers into your store more times a year, and I’m not sure that this will do it. It also eliminates impulse shopping purchases so I’m not convinced that this will work in the long run.
I did some Christmas shopping with Best Buy. They could not have made it easier. Twice, I went online and picked the gifts. Then they told me which stores in my area had the gifts in stock. I decided which store to pick them up at (or I could have had them mailed) and bought them. Best Buy then sent me an email and told me they were ready for pick-up (about 3 hours later). I went to the store, stood on a very short line and within minutes had the gifts.
More important than that is on one of those two trips, I bought additional merchandise. That merchandise was an incremental sale in the truest sense. So, why oh why, would Sears not just outfit their hundreds of current stores to do as Best Buy?
I don’t know the Sears metrics, but let’s say that a typical Sears store services a radius of 20 miles. Within that 20 mile radius the store carries all the merchandise it needs. What would the radius be for at store pick up of online orders? 5 miles? 10 miles? What is the breakpoint for me as a shopper to choose if I am going to pick my order up or have it delivered? And, if I do go to the store, might I just pick something else up? Sears does not need a unique operation to fulfill this strategy.
The only thing they have going for them is that there are a lot of former Circuit City locations that they can get cheap.
This will all come down to their ability to execute on the speed and convenience promise. Time starved consumers who get sold on the notion of saving time will expect to spend next to no time waiting for their items they’ve come to pick up. I can’t see that happening consistently, unless some great tech solution is at hand.
This reminds me of going to the airports and getting in one of those “Express Bag Drop” lines. The name suggests it will be fast, but there is rarely anything ‘express’ about it. As such, your frustration mounts even more.
Wishing Sears well with this though…it sounds like a good concept.
I haven’t liked anything Sears has done for the last 20 years–but I like this. Convenient pre-order and pickup is a well established consumer benefit.) We had take-out Chinese last night–didn’t you?) As consumers become comfortable with the translation of remote ordering systems and location pickup to things other than restaurants, and they will, models based on some form of this approach will thrive.
Smart retailers are agnostic to how customers interact with them…in-store, online, kiosk, mobile, drive through. We live in an age where customers expect convenience and regularly refreshed and exciting shopping experiences. Time will tell the degree to which customers embrace this sort of convenience. Certainly banks and restaurants would endorse drive-through concepts. The fact that the new concept is much less expensive to operate is icing on the cake.
LOVE IT! The convenience, speed, and increased assortment (versus on-shelf limitations) make this right on time. With more shoppers turning to the internet for purchases of every category, I bet we’ll see more of this.
Sure, site-to-store isn’t news. Numerous retailers, including many grocers, offer this service utilizing a desk at the back of the store (plus Sears of course). However, dedicating a store to this mode of shopping is a step forward. I believe that having control over impulse items in Gofer itself will also prove profitable. I understand that anywhere between 25 – 60% of site-to-store shoppers buy at the store too–making it a second POP. Terrific for retailers.
Way to go Sears!
All of us old timers remember Service Merchandise. They had something similar in a disco era sort of way and eventually went bankrupt. I got a feeling one of those young MBAs working at Sears with bad hair and a briefcase came up with this idea. If this was a good idea, Wal-Mart would be doing it already. My gut feel is that this will end up like all of the other bright ideas coming out of Sears, like Sears Grand, Sears Essentials, etc.
I have mixed feelings about this. I’ve used the in-store pick-up when I’ve ordered online and it worked out great for me. I loved having that option. And I just had to sit and wait in my car while a very helpful clerk retrieved my purchase and loaded it into my car. The process was quite smooth.
If I had been required to trek all the way out to Joliet to pick it up, I’m not sure if I would still have bought that item. But I can understand if that activity is picking up, that Sears would want to streamline it from an operational standpoint and for the sake of their employees, not to mention the storage space. It sounds like it might be a better move for Sears than for their customers though.
Interesting mix of opinions. I side with those who say kudos for trying. The one guarantee is that Sears will cease to exist if they don’t try some bold new strategies. Is this it? I don’t know, but I hope it is one of a portfolio of truly new ideas that they will try. As for those who say “if it’s a good idea, Walmart would have done it”: no large retailer in history has led on every new idea. If Sears were to wait to copy Walmart before trying to innovate, that would guarantee disaster as well.
What a nice fit with Microsoft’s Tag mobile tagging system, RFID, and other new technologies. While there have been several references today to earlier failed models along the lines of MyGofer (Best Products, Service Merchandise), perhaps it’s time for new gadgets and gizmos to make it work. New roboticized warehouse technologies are also available.
If the sales tax issue expands beyond New York (and perhaps hungry states will be inclined to make it so) is this a likely Headline:
Amazon announces Amazon-UPS retail centers. Lowest price, best information, largest range of SKUs.
Opening soon at the Mall that just shut down. (Oh, what a deal on the lease, BTW!)
I may be missing something, but I just can’t see what is more convenient about ordering something online and going to a drive-thru window to pick it up, with all the potential hassles there, versus ordering something online and getting free delivery right to your door. Sure, you can get the merchandise a couple of days sooner this way, potentially, but there is extra effort on the part of the consumer to make it happen. If someone is willing to drive to the drive-thru location, they would almost certainly be willing to drive to their local store and use an express pick up desk, so Sears wouldn’t have to build or remodel these new “stores.”
Good idea, but the devil will be in the details…AND…don’t lose sight of the fact that Product is always the #1 ‘P’–so, if that isn’t right, it’ll fail. This, after all, is only a delivery system.
Also, even better idea NOT to call it Sears. Sears Holdings should keep on that vein for sure.
This reminds me of the old catalog pick-up process. (Of course, I was a child then!) A process that is quick, easy and convenient will prove beneficial and successful. If the consumer orders from the internet and picks up at the store, they don’t want to wait or walk all the way through a store to pick up that order.
The “show room” concept is not new of course. It found some success in the 1970s for awhile (Best Products, Service Merchandise).
They all went under, as far as I know.
Sears obviously needs to do something–maybe this is it.
If it was smart, Sears would go very high tech on this. If someone drives up and has to wait for a long time in line, then again while someone gets the products from the back and takes forever doing so, etc. it won’t work.
If they enable customers to call on their cell phones, have the product ready to go at the door when the customer gets there, and they are on their way in just a few minutes, they might really have something.
Today’s consumer is not necessarily the same as yesterday’s. It was pointed out that this type of approach has gone wrong before. However it may simply indicate that it was before its time. The economy is driving many decisions for the consumer, especially for the time and economically starved.
This concept has a fair amount of consumer appeal, and it does not have to resemble Service Merchandise and the like from the past. After all, Sears certainly has enough locations to make this convenient…and by the way, who said they couldn’t take a hybrid approach on this concept? Perhaps they’ll embrace the best of both worlds, in a more efficient and smaller retail space and a functional drive-through pick-up.
What is in danger of being lost is the “shopping” aspect or experience. The sights, smells and sounds that accompany being out for the day. Impulse purchases would also likely be lost as shopping becomes a more mechanical/planned event. You couldn’t even call it shopping anymore. It would resemble more of a “purchasing” function. How satisfying would that be?
How would you reach this new type of “consumer”? Item level marketing would almost solely be online, prior to making the decision to buy.
I can see how returns would be complicated and less convenient while in the drive through.
Either way to soon to judge entirely, but the early concept gets props. Not sure about the boomers but Gen X & Gen Y will likely embrace this concept if the details are done with the consumers time/money in mind.
Consumers will hope that they will benefit–somehow.
Actually this is not a SEARS concept so much as a KMART concept. Don’t think in terms of the old “Sears catalog pickup,” but rather think of a Kmart basket of goods purchased online and packed and ready to pick up. If executed well, this is a very good idea for those of us who hate walking through ANY store to buy our laundry detergent, cat food, shampoo, etc. Similar to the Peapod model for groceries, but you pick up rather than the home delivery and you get discount Kmart pricing. It’s been tested for years as a service for Kmart and Sears corporate HQ employees (K-Concierge and then MyGofer) and this is a long overdue logical extension of that model.
If I take off the marketing hat and speak purely from my consumer voice, I like the concept of “curbside to go,” overall, but am not sold on how it’s making the life of consumers that much easier. If I’m already going to have to drive over and pick something up, what time do I really save waiting in my car for Applebee’s to bring out my food vs. walking through the front doors to retrieve my order?
Where I really feel this concept could take off is at “habitual retail” locations, e.g. grocery and drugstores. Places I constantly find myself having to visit and dreading to drag my children into.
Real world example:
Walgreen’s pharmacy drive-thru. If I had a nickel for every time I’ve left the doctor’s office with sick children, immediately proceeded to the pharmacy drive-thru to wait in the car for a prescription, and felt helpless and frustrated in the car at not being able to drag sick children into the store to get other much needed items, I’d be rich. If only I could place an order at the same time I dropped off my prescription, giving some Walgreen’s lackey 20 minutes or more to locate my items and bring them to the pharmacy counter. “In addition to my prescription today, I need Children’s Tylenol, Gatorade for their upset tummies, milk and bread because we’re out of it, a roll of film because I don’t want to go to Target this week, and the latest issue of Vanity Fair because I’m going to be home all day tomorrow with sick kids and I need something to read.” Not only would my total basket cost increase dramatically, but I would be lured away from other stores who do NOT have this convenience.
In comparison to the above, the Sears effort seems dull.
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MyGofer doesn’t sound too different from other site-to-store concepts, nor much different from the ability to pick-up scripts at the drive-thru. That said, I give Sears props for attempting to increase shopping convenience, for further merging its buying channels and for innovating during a recession. The MyGofer details are obviously sketchy right now, but given what we know, it sounds like an offering that will appeal to today’s shoppers, i.e., shoppers who are increasingly multichannel buyers.
Retailers must follow their lead by ensuring that customers have access to true cross-channel integration. I hope Sears succeeds. And I hope more merchants noodle new ways to reach the multichannel shopper.
Fix the assortment and branding first. (And spend some money on the insides of the stores.) Without the right merchandise content, it doesn’t matter whether Sears adds more convenience to a formula that isn’t working.
Is this a bona fide solution to time famine, instant gratification and better merchandising? Maybe, though it will depend on Sears’ ability to generate trial, re-craft meaningful customer relationships and out-deliver Amazon.
While this is innovative, interesting and opportunistic, it also seems a bit desperate. When it comes to “low-friction” retail, Amazon will continue to rule.
MyGofer is a good concept for Sears and I believe the potential for success is as good as Sears’ ability to execute the process well, and that’s where my skepticism comes into play. Sears has a history of creating new ideas but not executing them as well as the next player coming into the market. We shall see.
There are three questions here. Will it be faster and easier for the customer to pick up stuff at the store than at a regular store? If so, why is it taking so long to pick up the goods at the regular store? The first thing they need to be doing is just make it easier and faster for customers to get in and out with the online purchase at their regular stores.
The second question is will people coming to pick up merchandise go in and wander around the 20% of the store that is set up as a show room and then take the time to purchase the items?
Third will customers look at this as not only a pick up point but also as a place to shop? If that idea works than it is a good idea and a way of opening a new location with lower overhead. As stated above, all of the stores that were using this concept went out of business.
Will it be profitable? Will there be enough business generated that they can make it work? I certainly see the benefit of not having to maintain a pretty store and it will work great for things like appliances and furniture or small appliances, etc. The key is getting customers into your store more times a year, and I’m not sure that this will do it. It also eliminates impulse shopping purchases so I’m not convinced that this will work in the long run.
I did some Christmas shopping with Best Buy. They could not have made it easier. Twice, I went online and picked the gifts. Then they told me which stores in my area had the gifts in stock. I decided which store to pick them up at (or I could have had them mailed) and bought them. Best Buy then sent me an email and told me they were ready for pick-up (about 3 hours later). I went to the store, stood on a very short line and within minutes had the gifts.
More important than that is on one of those two trips, I bought additional merchandise. That merchandise was an incremental sale in the truest sense. So, why oh why, would Sears not just outfit their hundreds of current stores to do as Best Buy?
I don’t know the Sears metrics, but let’s say that a typical Sears store services a radius of 20 miles. Within that 20 mile radius the store carries all the merchandise it needs. What would the radius be for at store pick up of online orders? 5 miles? 10 miles? What is the breakpoint for me as a shopper to choose if I am going to pick my order up or have it delivered? And, if I do go to the store, might I just pick something else up? Sears does not need a unique operation to fulfill this strategy.
The only thing they have going for them is that there are a lot of former Circuit City locations that they can get cheap.
This will all come down to their ability to execute on the speed and convenience promise. Time starved consumers who get sold on the notion of saving time will expect to spend next to no time waiting for their items they’ve come to pick up. I can’t see that happening consistently, unless some great tech solution is at hand.
This reminds me of going to the airports and getting in one of those “Express Bag Drop” lines. The name suggests it will be fast, but there is rarely anything ‘express’ about it. As such, your frustration mounts even more.
Wishing Sears well with this though…it sounds like a good concept.
I haven’t liked anything Sears has done for the last 20 years–but I like this. Convenient pre-order and pickup is a well established consumer benefit.) We had take-out Chinese last night–didn’t you?) As consumers become comfortable with the translation of remote ordering systems and location pickup to things other than restaurants, and they will, models based on some form of this approach will thrive.
Smart retailers are agnostic to how customers interact with them…in-store, online, kiosk, mobile, drive through. We live in an age where customers expect convenience and regularly refreshed and exciting shopping experiences. Time will tell the degree to which customers embrace this sort of convenience. Certainly banks and restaurants would endorse drive-through concepts. The fact that the new concept is much less expensive to operate is icing on the cake.
LOVE IT! The convenience, speed, and increased assortment (versus on-shelf limitations) make this right on time. With more shoppers turning to the internet for purchases of every category, I bet we’ll see more of this.
Sure, site-to-store isn’t news. Numerous retailers, including many grocers, offer this service utilizing a desk at the back of the store (plus Sears of course). However, dedicating a store to this mode of shopping is a step forward. I believe that having control over impulse items in Gofer itself will also prove profitable. I understand that anywhere between 25 – 60% of site-to-store shoppers buy at the store too–making it a second POP. Terrific for retailers.
Way to go Sears!
All of us old timers remember Service Merchandise. They had something similar in a disco era sort of way and eventually went bankrupt. I got a feeling one of those young MBAs working at Sears with bad hair and a briefcase came up with this idea. If this was a good idea, Wal-Mart would be doing it already. My gut feel is that this will end up like all of the other bright ideas coming out of Sears, like Sears Grand, Sears Essentials, etc.
I have mixed feelings about this. I’ve used the in-store pick-up when I’ve ordered online and it worked out great for me. I loved having that option. And I just had to sit and wait in my car while a very helpful clerk retrieved my purchase and loaded it into my car. The process was quite smooth.
If I had been required to trek all the way out to Joliet to pick it up, I’m not sure if I would still have bought that item. But I can understand if that activity is picking up, that Sears would want to streamline it from an operational standpoint and for the sake of their employees, not to mention the storage space. It sounds like it might be a better move for Sears than for their customers though.
Interesting mix of opinions. I side with those who say kudos for trying. The one guarantee is that Sears will cease to exist if they don’t try some bold new strategies. Is this it? I don’t know, but I hope it is one of a portfolio of truly new ideas that they will try. As for those who say “if it’s a good idea, Walmart would have done it”: no large retailer in history has led on every new idea. If Sears were to wait to copy Walmart before trying to innovate, that would guarantee disaster as well.
What a nice fit with Microsoft’s Tag mobile tagging system, RFID, and other new technologies. While there have been several references today to earlier failed models along the lines of MyGofer (Best Products, Service Merchandise), perhaps it’s time for new gadgets and gizmos to make it work. New roboticized warehouse technologies are also available.
If the sales tax issue expands beyond New York (and perhaps hungry states will be inclined to make it so) is this a likely Headline:
Amazon announces Amazon-UPS retail centers. Lowest price, best information, largest range of SKUs.
Opening soon at the Mall that just shut down. (Oh, what a deal on the lease, BTW!)
I may be missing something, but I just can’t see what is more convenient about ordering something online and going to a drive-thru window to pick it up, with all the potential hassles there, versus ordering something online and getting free delivery right to your door. Sure, you can get the merchandise a couple of days sooner this way, potentially, but there is extra effort on the part of the consumer to make it happen. If someone is willing to drive to the drive-thru location, they would almost certainly be willing to drive to their local store and use an express pick up desk, so Sears wouldn’t have to build or remodel these new “stores.”
Good idea, but the devil will be in the details…AND…don’t lose sight of the fact that Product is always the #1 ‘P’–so, if that isn’t right, it’ll fail. This, after all, is only a delivery system.
Also, even better idea NOT to call it Sears. Sears Holdings should keep on that vein for sure.
This reminds me of the old catalog pick-up process. (Of course, I was a child then!) A process that is quick, easy and convenient will prove beneficial and successful. If the consumer orders from the internet and picks up at the store, they don’t want to wait or walk all the way through a store to pick up that order.
The “show room” concept is not new of course. It found some success in the 1970s for awhile (Best Products, Service Merchandise).
They all went under, as far as I know.
Sears obviously needs to do something–maybe this is it.
If it was smart, Sears would go very high tech on this. If someone drives up and has to wait for a long time in line, then again while someone gets the products from the back and takes forever doing so, etc. it won’t work.
If they enable customers to call on their cell phones, have the product ready to go at the door when the customer gets there, and they are on their way in just a few minutes, they might really have something.
Today’s consumer is not necessarily the same as yesterday’s. It was pointed out that this type of approach has gone wrong before. However it may simply indicate that it was before its time. The economy is driving many decisions for the consumer, especially for the time and economically starved.
This concept has a fair amount of consumer appeal, and it does not have to resemble Service Merchandise and the like from the past. After all, Sears certainly has enough locations to make this convenient…and by the way, who said they couldn’t take a hybrid approach on this concept? Perhaps they’ll embrace the best of both worlds, in a more efficient and smaller retail space and a functional drive-through pick-up.
What is in danger of being lost is the “shopping” aspect or experience. The sights, smells and sounds that accompany being out for the day. Impulse purchases would also likely be lost as shopping becomes a more mechanical/planned event. You couldn’t even call it shopping anymore. It would resemble more of a “purchasing” function. How satisfying would that be?
How would you reach this new type of “consumer”? Item level marketing would almost solely be online, prior to making the decision to buy.
I can see how returns would be complicated and less convenient while in the drive through.
Either way to soon to judge entirely, but the early concept gets props. Not sure about the boomers but Gen X & Gen Y will likely embrace this concept if the details are done with the consumers time/money in mind.
Consumers will hope that they will benefit–somehow.
Actually this is not a SEARS concept so much as a KMART concept. Don’t think in terms of the old “Sears catalog pickup,” but rather think of a Kmart basket of goods purchased online and packed and ready to pick up. If executed well, this is a very good idea for those of us who hate walking through ANY store to buy our laundry detergent, cat food, shampoo, etc. Similar to the Peapod model for groceries, but you pick up rather than the home delivery and you get discount Kmart pricing. It’s been tested for years as a service for Kmart and Sears corporate HQ employees (K-Concierge and then MyGofer) and this is a long overdue logical extension of that model.
If I take off the marketing hat and speak purely from my consumer voice, I like the concept of “curbside to go,” overall, but am not sold on how it’s making the life of consumers that much easier. If I’m already going to have to drive over and pick something up, what time do I really save waiting in my car for Applebee’s to bring out my food vs. walking through the front doors to retrieve my order?
Where I really feel this concept could take off is at “habitual retail” locations, e.g. grocery and drugstores. Places I constantly find myself having to visit and dreading to drag my children into.
Real world example:
Walgreen’s pharmacy drive-thru. If I had a nickel for every time I’ve left the doctor’s office with sick children, immediately proceeded to the pharmacy drive-thru to wait in the car for a prescription, and felt helpless and frustrated in the car at not being able to drag sick children into the store to get other much needed items, I’d be rich. If only I could place an order at the same time I dropped off my prescription, giving some Walgreen’s lackey 20 minutes or more to locate my items and bring them to the pharmacy counter. “In addition to my prescription today, I need Children’s Tylenol, Gatorade for their upset tummies, milk and bread because we’re out of it, a roll of film because I don’t want to go to Target this week, and the latest issue of Vanity Fair because I’m going to be home all day tomorrow with sick kids and I need something to read.” Not only would my total basket cost increase dramatically, but I would be lured away from other stores who do NOT have this convenience.
In comparison to the above, the Sears effort seems dull.