Photo: Lowe’s
Will lockers help Lowe’s pick up more sales?
Lowe’s announced that it plans to have self-service pickup lockers installed at its stores in most major metropolitan areas by Thanksgiving and those remaining by the end of March 2021.
The home improvement retailer, which operates more than 1,700 stores across the U.S., is aggressively expanding the availability of lockers at its locations following a 50-store test in Charlotte, Philadelphia and the New York tri-state area (CT, NJ and NY). A Lowe’s spokesperson told RetailWire that the stores with lockers registered “higher customer satisfaction scores and repeat visits.”
Orders, when placed online by customers, are staged by Lowe’s associates. Customers receive an automated email notification with a one-time user barcode. When they arrive at the store, they scan the barcode at the locker using their smartphone. The process enables them to skip the pickup line at the counter and eliminates the need for a touchscreen or keypad.
“With more than 60 percent of online orders picked up in our stores, this gives our customers one more option and the added convenience and flexibility to control how and when they get that order,” said Joe McFarland, Lowe’s executive vice president of stores. “This is a significant step in our relentless efforts to create a fast and frictionless shopping experience for today’s time-pressed customers.”
Mr. McFarland told the Charlotte Business Journal that Lowe’s had moved up the installation of the lockers about a year ahead of its original plans. The chain expects that the majority of customers who used store pickup since the novel coronavirus outbreak began will continue to do so even when public threat levels eventually diminish.
Lowe’s sees its locker initiative as another piece of the puzzle in upping its digital sales and in-store technology capabilities in an effort to better serve its professional and non-professional customers.
The retailer announced in August that it was opening a second direct fulfillment center in Mira Loma, CA, next month. The facility, along with another in Nashville, opened in 2018 will enable Lowe’s to provide two-day delivery to almost 100 percent of its customers across the U.S.
Management also plans to open 50 cross-dock delivery terminals, seven bulk distribution centers and four e-commerce fulfillment warehouses over the next year-and-a-half. Lowe’s goal is to enable same- and next-day deliveries of online orders to its customers.
Discussion Questions
DISCUSSION QUESTIONS: How do you rank the benefits of lockers versus traditional counter pickup services for consumers and retailers? How likely is it that retailers will try to shift their pickup models to focus more on self-service options similar to what Lowe’s is doing?
Poll
BrainTrust
I think this is an excellent idea, and I commend Lowe’s for introducing it. Convenience is a significant desire from every customer. So if I am going to pick the item up at the store, Lowe’s has just made that even easier for me without the hassle of having to wait in another line. Customers are busy people and if they’re willing to go to the store, getting them in and out quickly is a must. With lockers they can easily get their online purchase, and if they do have other shopping to do, having lockers has helped get them into the store. I expect this to be extremely successful for Lowe’s and for many other retailers to follow the same idea soon.
Lockers have worked well for Home Depot, so they will likely do the same for Lowe’s. The main advantage is that they allow consumers to collect orders faster and without having to line up at the collections or customer service desks. For many doing improvements projects such speed and convenience are very welcome. Amazon has also used lockers, both in some of its Whole Food stores and at other locations, and they too have been successful. I think more retailers will likely look to lockers to form part of their fulfillment ecosystem alongside other options.
Lowe’s lockers provide additional flexibility and convenience for customers vs. traditional counter pick-up, and so this is a helpful new service feature. However, some customers will still require assistance (e.g. when there’s an issue with the item in the locker) and so lockers won’t replace the customer service counter completely. Shifting pickup models to self-service do offer many advantages to both the customer and retailer, so I expect to see much more of this for the retailers who have the physical space to facilitate it.
Exactly right. In my example I did have a problem with the order and had to return an item. But the customer service was just inside the door and the entire experience was fast and easy.
Lockers have worked for years for Amazon, UPS and Home Depot as well. If you know exactly what you want and you’d like to skip the entire checkout process or store navigation, it’s perfect. But if you have questions or want to shop, it’s obviously not for you. It also says to the customer, “we get it, you’re in a hurry, here you go,” which goes a long way on the brand side.
Waiting in lines is a frustrating experience that consumers despise. I am a big proponent of merchandise pick-up lockers for online orders. I have waited in long lines at home improvement online order pick-up and in some cases I could have picked it off the shelf myself faster than waiting in line for customer service. We will likely see more pick-up lockers at many types of retailers in the near future.
Chalk up another win for convenience. But I suspect that this is a more expensive route to fulfillment for the retailer. As a customer I am often my own picker, packer and ringer at a self service checkout. I never interact with a sales person or anybody else in the store. Lockers will require the retailer to provide the picker/packer. Maybe it’s an incremental expense, maybe not. But lockers seem to be a model with a long life.
In August we were talking about Lowe’s introducing tool rentals, today it’s adding lockers. Of course, the addition of lockers will help sales with consumers who prefer quick and non-human contact.
But neither tool rental nor lockers are new and have been in use in Lowe’s competitors’ stores for a long time. It seems to me that rather than leading the pack, Lowe’s is playing catch-up.
I think time starved customers will love this service. The one thing that scares me somewhat is the fact that when customers walk into stores, 50 percent of the store is rarely seen. They have direct needs and go to where they need to go. By putting these lockers and pick up areas upfront, does it stand to deteriorate more foot traffic throughout the entire store? I think it might.
Great idea and as Lee said, lockers have worked for years for others. Offering the option gives shoppers more choices on how they want to interact with the brand and that’s an important part of any brand experience. I don’t see a shift to pickup models, I see them as complementing self-service offerings.
Exterior facing lockers would be great because it turns the store into a 24-hour pick-up center. I can see retailers shifting to that type of model to minimize store labor costs during down hours while offering the ability for folks to still engage with the brand. Maybe we’ll soon see mobile lockers roaming our neighborhoods on weekends to save us the three weekend trips to Lowe’s, Home Depot, or ACE during our weekend projects.
You had me at “skip the pickup line.” Lockers provide tremendous convenience for shoppers on the go who don’t require any associate interaction. Lockers may not be for every retailer as considerations must be made for item size, basket size, product tag removal, customer ID validation, etc. But for those who have the real estate and a high enough volume of BOPIS orders, it can provide efficiencies on both ends of the shopping transaction.
I think it will certainly help with customer retention, driving more sales I’m not certain. Their biggest competitor already does this. I used it recently and to be able go to a locker, scan my phone, have the door pop open and find my purchase waiting for me was great. I didn’t have to go into the store. A great example of touch free commerce.
As home improvement booms, lockers boost Lowe’s last-mile speed for easy, efficient e-commerce.
Lockers extend BOPIS options beyond counter and curbside pickup for time savings, flexibility and autonomy. For convenience during the pandemic, lockers help shoppers avoid entering stores, waiting in checkout lines and touching payment surfaces.
Lowe’s also wins because lockers are more cost-effective than home delivery and staffing counter pickup.
This incremental improvement to the customer experience will motivate more retailers to add similar self-service options.
Lockers work, period, end of story. They also are less labor intensive than other BOPIS vehicles. Of course, they also tend to reduce or eliminate dwell time, so there are trade-offs. If the pandemic continues for another six months to a year, I think you will see more retailers adopting the model.
Does this offer an advantage in terms of increasing online sales from customers? If not, then I’d suspect someone decided reducing human employees was the goal. And if that’s the case, this is short sighted.
I’ve picked up many things at the customer service counter at Lowe’s and it has always worked well. What I’ve also noticed is that Lowe’s understands the value of a personal interaction with a customer.
Retailers should NOT be eliminating an opportunity for personal interaction unless there’s tremendous profit to be had by eliminating it. My guess is that this is merely a small opportunity which might be giving up a big long term value to get it.
The sharp increase in pickup orders have strained customer service in many retailers and led to long lines waiting for pickup. Lockers are a definite way to improve that experience by eliminating lines. More and more retailers will be adopting this approach for non-perishable smaller items. Pickup on demand, 24/7 appeals to convenience customers — which is almost everyone these days!
There are pluses and minuses to this. One plus is that it gets the contractor back to the job site faster. One minus is that it means the contractor doesn’t get the opportunity to see what might be on sale that could be used now. Which is better? I don’t know. I did not notice how payment is handled. Maybe the contractor has an account to be paid monthly. I think the locker is a good idea and will be a benefit.
Great idea. Being able to skip the line would be very attractive. It will still be necessary for customer service but that line should now be shorter.
I see little to dislike here, provided the lockers are easy to find and operate properly. There might be a problem with turnover if people don’t claim things promptly, but then that would simply shift the issue from the pickup storage area to the lockers, so it’s a wash.