Burlington Bucks BOPIS, BORIS And eCommerce
In an age when most retailers across all verticals have accepted the need for the customer to “have it your way,” Burlington Stores (once upon a time Burlington Coat Factory), has announced it will be abandoning the eCommerce business.
The company joins fellow off-price retailer Ross in focusing on the in-store treasure hunt and avoiding the expense of constant web site updates and sequestered inventory designated for an eCommerce site. The behemoths of off-price, TJ Maxx and Marshall’s (both owned by TJX) continue to sell online and offer BORIS to its customers, though they don’t seem to offer BOPIS.
On one hand in ordinary times, Burlington can make a great case for abandoning eCommerce. Digital sales accounted for .5% of the company’s total sales in 2019, even as stores continue to do well both in top- and bottom-line results. The company is using its funds to open more, smaller stores in new and existing markets.
On the other hand, there’s an elephant in the room – COVID-19. As the number of cases continues to rise, and we still live with uncertainty around its spread in the US and actual death rates, people are starting to change their behavior.
- Instacart is now offering a “buy it and we’ll just drop it on your doorstep” option
- It’s almost impossible to find hand sanitizer anywhere, and people are publishing home-grown recipes on social media
- The mask situation is odd…with a run on masks even as the CDC sends mixed messages: “You don’t need them as they don’t help prevent anything but save them for healthcare workers.” What?
- For some unfathomable reason, people are hoarding toilet paper. While the biggest incidence seems to be in Australia, my local Publix has been out of multi-roll packs for some time now
- The CDC requests we keep a two-week supply of food and water on-hand. I don’t quite understand why we need to hoard water, but I tend to do it anyway so it’s no big one for me
- People are canceling vacations and non-essential medical and dental appointments
So, it really does beg the question (and I rarely ask it), is this really the time to open more stores? Would the company be better served adjusting to the times, at least for now?
My own opinion is that I wouldn’t have done this right now. A treasure hunt is all well and good, except when there are sharks in the water. Then, a treasure is better left undisturbed. And, in a time when people are going to be spending more and more time in their homes, wouldn’t you at least want to provide the treasure hunt online? Maybe you don’t want to get into the shipping business, but you can be pretty sure that the path to purchase is going to begin online and may be more meandering that it might have been in the past.
In fact, my key take-away from the current situation is that retailers should have their eCommerce acts together. It’s time for grocers in particular, to get really serious about home delivery, or at least the “drive through pick-up” option.
I don’t think it’s going to be a great few months for malls, really. Or for the airline or hotel businesses. That just means that our consuming society is going to spend a lot of time browsing and maybe buying online.
It would be my wish that all countries would test for the virus the way South Korea has, but there are those, particularly in the US, who believe this is an over-hyped event. My advice is to read the Wikipedia description of the Spanish flu epidemic of 1918- 1920. Even allowing for the fact that life expectancy is now longer, and we have an array of antibiotics to deal with complications from viruses, the fact is we have no vaccine and we have no anti-viral to mitigate it. And the fatality rate seems to be tracking at 3%.
Meanwhile, I expect online sales to surge. I hope Burlington is right in its decision, or that this pandemic is short-lived. We haven’t seen the peak yet, that I know. Let’s hope we get there quickly.
I expect TJ Maxx and Marshalls to get the spoils of the off-price retail war.