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Retailers Ace Deliveries to Woo Shoppers This Holiday Season

Rajani Lohia
·5 min read
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The coronavirus pandemic, which was initially seen as a short-term inconvenience, slowly emerged as the reason for several long-term trend shifts in the retail space. Among the many changes, retailers witnessed a stark swing in shopping preferences wherein customers turned to online portals as this was deemed a safe option and in some cases, the only way to shop. This navigation to online shopping is now viewed as the new normal for shoppers and became a long-term survival strategy for retailers.

That said, retailers are trying to pull all strings to adapt to rising online demand through increased investments in websites, mobile apps, merchandise assortments, checkout among others. Additionally, this heavy dependence on online or e-commerce attracted higher investment in fulfillment options including expansion of distribution centers as well as capabilities like Buy Online Pick-Up In Store (BOPIS), Buy Online Ship From Store, next-day delivery, same-day delivery and many more.

Retailers Prepping for Holiday Shopping Boost

With the holiday season approaching, retailers have been making diligent efforts to make the shopping experience pleasant for consumers amid the pandemic. Consequently, all retailers from apparel chains to electronics or even online retail giants like Amazon AMZN are insisting on starting the holiday shopping a little early to avoid the crowded stores at any time of the day or prevent the last-minute rush in online orders, causing shipping delays.

To further ease the shipping deferrals during the holiday season, companies are constantly enhancing delivery options so that consumers can get the most secure shopping experience. Retailers are tying up with companies providing delivery services to reach the doorstep of their customers. After the success of BOPIS and curbside pickup services amid the pandemic, many companies are looking to upgrade same-day and next-day delivery options with some also delivering products within a few hours from the time of order placement.

Bed Bath & Beyond BBBY is one of the retailers that are looking to woo customers via the introduction of same-day delivery at Bed Bath & Beyond and buybuy BABY stores and online. The company recently partnered with Instacart and delivery service provider Shipt, owned by Target Corp. TGT, to improve its omni-channel capabilities ahead of the holiday season. Bed Bath & Beyond and buybuy BABY customers can avail of the same-day delivery service for a flat-rate fee of $4.99 for orders above $39.

Apart from the Bed Bath & Beyond and buybuy BABY websites and mobile apps, the same-day delivery services will be available to customers through the Shipt and Instacart websites and mobile apps. Existing Shipt clients will be eligible for free, same-day delivery on orders in excess of $35 while shopping directly through the Shipt platform.

Notably, Instacart and Shipt are the best delivery services in the marketplace with each reaching more than 80% of the American households. Target acquired Internet-based grocery delivery service Shipt in August 2018 to provide the same-day delivery of groceries, essentials, home, electronics as well as other products. Other retailers having agreements in place for same-day delivery services with Shipt are Costco Wholesale Corp. COST and The Kroger Co. KR.

Moreover, earlier this year, Costco launched CostcoGrocery to deliver non-perishable items to buyers’ home and expanded its same-day grocery delivery service in collaboration with Instacart to drive its online sales. These delivery systems have been yielding favorably and driving more traffic. The company also unveiled same-day prescription Rx delivery and same-day alcohol delivery through Instacart.

In June, Big Lots, Inc. BIG announced partnership with Instacart to provide same-day deliveries from across nearly 1,400 Big Lots’ stores. Shoppers can place their orders through the Instacart app or on the Big Lots’ page on the Instacart website. Apart from Big Lots’ grocery and pantry staples, customers can shop for home decor, kitchen and dining products as well as personal care items using the same-day delivery option.

Given the rising concerns over the pandemic, Tractor Supply Company TSCO launched same-day delivery across all 1,863 U.S. stores in April in collaboration with Roadie. Notably, this made Tractor Supply the nation’s first general merchandise retailer offering same-day delivery facility across all its outlets.

Target currently sports a Zacks Rank #1 (Strong Buy) while both Big Lots and Kroger carry a Zacks Rank #2 (Buy) at present. Tractor Supply, Bed Bath & Beyond, Costco and Amazon carry a Zacks Rank #3 (Hold) each. You can see the complete list of today’s Zacks #1 Rank stocks here.

Conclusion

The social-distancing norms amid the pandemic made consumers reluctant to step out in the marketplace. Precisely, expediting delivery services became the need of the hour to avoid congestion in stores and shipping interruptions during the holiday season this year. Overall, the various omni-channel solutions and fulfillment options provided by retailers should help them not only recover losses suffered during the prevalent COVID period but also reap the maximum benefit from the most happening shopping season of 2020.

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Click to get this free report Target Corporation (TGT) : Free Stock Analysis Report Amazon.com, Inc. (AMZN) : Free Stock Analysis Report Big Lots, Inc. (BIG) : Free Stock Analysis Report Bed Bath Beyond Inc. (BBBY) : Free Stock Analysis Report Costco Wholesale Corporation (COST) : Free Stock Analysis Report Tractor Supply Company (TSCO) : Free Stock Analysis Report The Kroger Co. (KR) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research