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A new study from Auburn University’s Harbert College of Business found that consumers who buy online and collect in-store, a process known as BOPIS or click and collect, are more likely to be satisfied with substitutions for out-of-stock products when the item is a staple like ketchup or paper towels rather than a pleasure item like coffee or perfume.
“For products that are considered utilitarian or meet the practical needs of consumers, retailers should use substitutes that have similar specifications, but are not necessarily the same brand,” said Dora Bock, associate professor in the Department of Marketing. “For more hedonic or experiential products, we find that consumers react quite similarly to substitutes that are either the same brand as the original order, or [have the] same specifications.
Bock conducted the study with faculty members from the University of Miami in Ohio, Yao “Henry” Jin, associate professor of management, and Monique Ueltschy Murfield, associate professor and director of the Center for Supply Chain Excellence.
Their article, “Do as you say or I will: Retail signal congruence in online shopping, in-store pickup, and negative word-of-mouth,” was published online September 15. in the Journal of Business Logistics.
The popularity of BOPIS shopping for groceries, clothing, home furnishings, beauty items and other products has accelerated over the past two years, with some consumers opting to limit their outings in public. .
“BOPIS has increased by more than 500% in some industries,” Bock said, citing data from unified commerce leader Kibo, which helps retailers, manufacturers and brands engage their shoppers. “This increase is largely the result of the COVID-19 pandemic and more shoppers willing to try alternative shopping methods for health and safety reasons.”
In addition to shifting shopping preferences, nearly every retailer, including Target, Walmart, Kohl’s, Kroger and Publix, experienced unprecedented supply chain failures that led to product shortages.
Given the convergence of these two phenomena, their research has practical implications for retailers who offer BOPIS as an option to customers, namely that their findings provide new insight into how customers respond to different substitutions and will play a role. role in demand and inventory planning.
“BOPIS out-of-stock situations occur because inventory records aren’t always 100% accurate,” Bock explained. “Retailers that offer a wide assortment of products need to understand customer perceptions of the product category, as this will impact a customer’s effectiveness and satisfaction with a given substitute. Utilitarian product categories are easier to substitute than hedonic product categories.
In the study, Bock and colleagues addressed the lack of research on how customers respond to BOPIS shopping experiences when retailers run out of stock and make product substitutions on orders.
Drawing on the principles of signaling theory, they conducted a series of five scenario-based role-playing experiments. In one experiment, they asked over 250 participants to assume the role of a customer whose BOPIS experience involved product substitutions; they then asked participants to write online reviews of their experience. The researchers then used text analysis software to assess participants’ opinions.
“We have found that the type of substitute provided by the retailer, whether of the same brand or of similar specifications, will result in different customer reactions to the substitute, depending on the customer’s motivation to buy the product,” Bock said. “Whether [retailers] concerned with spreading positive word of mouth or reducing negative word of mouth, it is important [for them] understand the motivation of customers to buy this product [so they can] provide the most satisfactory substitution.
Bock and his colleagues are now expanding their research to look at situations where retailers offer their customers other options of out-of-stock items purchased through the BOPIS method.
“We will look at how customers react to being referred to another nearby store or buying the item for delivery but delayed shipping,” she said.