Daily Insights

Development in the Details

By: Alizah Asif Farooqi | Jul 16, 2019

Most department stores cannot reasonably keep pace with Amazon and Walmart’s expansive fulfillment offerings. However, the proliferation of expedited shipping from big box retailers has raised expectations around speedy shipments.

The last year saw limited overall advancement in new shipping options, where most department stores hadn’t adjusted shipping policies. Others that did overhaul offerings struggled to do so effectively: following House of Fraser’s acquisition, the retailer fumbled its transition of expedited fulfillment offerings and saw backlash from customers waiting for packages. Due to overhauling shipping offerings being difficult and costly, many developments since 2018 have been in the details. Nordstrom and others have slightly increased fees for expedited one-day and two-day shipping, while Sears and Kohl’s have experimented with different minimums to maximize the value of their respective fulfillment offerings.

Traditional department stores must aim to strike a balance of speed and cost-efficiency in their offerings and clearly communicate them across digital touchpoints. Most department stores, however, haven’t maximized those offerings. While 52% of department stores tracked in Gartner L2’s report on the topic offer free shipping for a minimum spend, less than half tell customers how far along they are toward reaching the minimum. When price-conscious shoppers add products to their carts on TJMaxx’s site, a pop-up signals how close they are to the free shipping level and promotes more items. Higher end outlets like Hudson’s Bay and Lord & Taylor, however, still fail to communicate how close customers are to free shipping.

Department stores should use shipping minimums as a tool for encouraging customers to both add more to their shopping carts and drive to check-out.