POPcodes, a startup focused on improving consumer, merchant and acquirer experiences, has been selected as a finalist in the 2018 Canadian FinTech & AI Awards. The Awards are held on November 26th in Toronto and bring together over 4,000 of Canada's top entrepreneurs to attend the formal black tie Awards Gala.
The influence of mobile technology on retail in this century has been truly astounding. By 2003, 95 million people around the globe made a payment via their mobile device. By 2015, there were 500 million users making 50 billion transactions for a total volume of 610 billion USD. With mobile wallet growth on the rise, could it be the next subset of mobile commerce to reap the benefits of a mobile hungry populace? Over the last five years, m-commerce has enjoyed a 30% compound annual growth rate (CAGR) that is showing little sign of slowing down. If brick and mortar retail is still king, what will it take to bring mobile wallet adoption out of the hands of early adopters and into the hearts and minds of shoppers worldwide?
POPcodes is one of only fifteen late stage startups selected from around the globe to take place in Money 20/20’s 5th year’s competition. The action will be fast paced, interactive and fun, as judges from leading VC firms and audience voting will determine the 4 winners from our curated list of startup companies.
Gregg Aamoth, CEO and Co-Founder of omnichannel solution provider POPcodes and a former VP of Customer Marketing Systems and Privacy at Macy’s, is a heavy proponent of the buy online, pickup in-store trend and believes this model creates the most seamless shopping experience across all channels. The model also is known to strip down the hassle of pricing, as 86% of consumers who order products online and pick them up in the store want to avoid shipping fees, according to a POPcodes survey.
In the below Q&A, Aamoth details the buy online, in-store pickup process, and explains why it provides an added convenience that other delivery models do not.
Today's consumers expect to shop when they want and get what they need as quickly as possible, so it's no surprise that more and more retailers are offering omnichannel options. Every retailer has different priorities, but the goal is the same – to offer consumers the most streamlined, convenient and satisfying shopping experience imaginable. This means providing a retail experience that isn't either physical or digital anymore – but physical with digital. When it comes to fulfillment options, this means online purchase, in-store pickup.
The demand for buy online, pick up in store is higher than ever. According to Jarrett Streebin, CEO of San Francisco-based shipping firm EasyPost, in-store pickups for online purchases grew 15 percent in November, and will grow again in 2015. Unfortunately, many retailers are hesitant to implement this fulfillment model as a result of misguided perceptions. In reality, implementing in-store pickup is not nearly as expensive, complicated or narrowly-desired as they think. Here is the truth behind three common misconceptions about in-store pickup:
The onset of 2015 marked a huge change in shipping costs, and as a result retailers are struggling to find ways to maintain their bottom lines. As of Jan. 1, packages are now being evaluated by their “dimensional weight,” or volume, instead of determining price by weight alone. Experts say that the when combined with other annual rate hikes and surcharges, the resulting average rate increases will be as high as 30% or more.
Unfortunately, retailers are being forced to make sacrifices in the name of customer service in order to soften the blow. Some are raising free-shipping minimums, some are raising prices, and others are cutting free shipping altogether. But for the 68% of retailers already offering free delivery, cutting free shipping would take a serious toll on customer satisfaction.
So what exactly is this main goal? According to Aamoth, its getting the customer to fulfill an online order efficiently, while bringing them to a physical location where they can shop for additional items and drive incremental sales in both channels. Ace Hardware, for example, claims to have seen an average lift of 18% to 20% in e-commerce sales since installing in-store pickup.
The advantages of buying online and picking up in-store don’t end with the money saved on shipping costs. Directing customers into the store to complete their transaction results in major net gains for retailers, as two out of every three consumers shop for additional items when picking up a product in store, according to a recent POPcodes survey. The opportunity to upsell is unique to the in-store experience, and when consumers have the option to test and try, they are much more likely to make incremental purchases.
A true omnichannel shopping experience is the ultimate value proposition retailers can offer their customers, and the order delivery and fulfillment experience is a vital part of this new shopping journey. To succeed, retailers must allow shoppers to receive their items at any time, and through any channel.
Today's consumers are always connected, interacting with companies using an array of devices and across multiple channels. Consumers' ability to shop at any time and on any Internet-connected device gives them the freedom to choose when and where to browse. They can access pricing, inventory, and reviews from multiple sources. They can compare pricing with shipping from multiple online retailers. And many of them do this when they're walking around in your store.
Comparing Amazon’s new Manhattan site, which will serve as the central distribution center for its new same-day delivery service Amazon Prime Now, to a “store” is a bit of a stretch. However, given their 17-year lease, only time will tell how much impact it has in terms of brand exposure and customer experience.
But Amazon is just one of many online retailers stepping into the “clicks-to-bricks” game. Birchbox, Bonobos, Warby Parker, and Zappos have all clued into key findings about consumer shopping preferences and trends. Research has shown that consumers who have the option of shopping both online and off are spending up to four times as much as those shopping just one channel. Of course, e-retailers are hungry to capitalize on this.
Amazon continues to dive further into e-commerce with the release of its new pricing feature “Make an Offer”.
The new “Make an Offer” tool allows Amazon to compete with online auctioneer eBay, by enabling customers to negotiate lower prices on products listed on Amazon. Sellers and buyers can negotiate through email until the deal is complete.
According to the company, “Make an Offer” is an opt-in feature for retailers, which means they will have the flexibility to decide which items they want to be enabled with the “Make an Offer” experience.
“We hear from sellers that there are items they are flexible with on price and are excited to negotiate with interested customers, and there are other items that they will not enable with the ‘Make an Offer’ experience, so it’s only for sale at the fixed price,” an Amazon spokesperson tells ClickZ.
Currently the only items enabled with the “Make an Offer” feature are sports and entertainment collectibles, collectible coins, and fine art. Amazon declined to disclose whether it will roll out this feature to other less expensive categories like electronics and books in the future.
“It’s interesting that Amazon is taking on categories like sports and entertainment collectibles where eBay has a dominance,” says Scot Wingo, co-founder and chief executive (CEO) of ChannelAdvisor, a provider of cloud-based e-commerce solutions. “eBay has been offering a similar feature called ‘Best Offer’ for a while, and it’s very popular.”
Gregg Aamoth, co-founder and CEO of POPcodes, a company that enables online payment and pick-up in-store, thinks this move indicates Amazon is considering consumer interaction to be a critical part of the shopping experience. “‘Make an Offer’ is one example of Amazon’s push to better connect with its customers. It adds another touch point in the shopping experience,” he says, adding that brick-and-mortar retailers will also be impacted by Amazon’s name-your-price model, because at large retail stores like Macy’s, consumers don’t have the bargaining power.
“I’d like to see if there will be more consumers expecting to negotiate prices in-store,” he notes.
With this move Amazon will likely give eBay a run for its money. But eBay doesn’t seem daunted. On the same day that Amazon introduced the “Make an Offer” tool, eBay debuted its new iPad app design, which aims to deliver a better shopping experience for buyers and better merchandising capabilities for sellers. The company plans to officially release the design in the first quarter of 2015.
“eBay has been struggling in the past two years. It would be interesting to see how eBay will reverse the slide and combat Amazon,” says Wingo, referring to his company’s data, which shows that in November of this year, Amazon saw much stronger sales in the U.S. than eBay, whose growth was just below the e-commerce growth rate.
Aamoth agrees that in terms of sales, Amazon has a competitive edge. “[But] in terms of facilitating the consumer-merchant interaction and having more price and product quality, eBay has been a strong leader for quite some time,” he says. “eBay is built around price negotiation and because it sells both new and used products, it has to have more of a buyer-seller dialogue.”
It’s hard to say whether Amazon or eBay will win the global e-commerce war. But one thing is for sure – Amazon is making efforts to improve its e-commerce business. In addition to the “Make an Offer” feature, the company initiated an ad training program called Trusted Creative Partner Program this week, where six select ad agencies – Leo Burnett’s Arc Worldwide, DDB California, Epsilon-Ryan, Possible, Rockfish, and TeaLab – will deliver creative advertising on Amazon’s sites and devices, including the Fire tablet, with special offers and e-commerce ads.
One of the most popular trends today in online retailing is customers buying online and picking up in-store, a practice referred to, cleverly, in the U.K., as “click and collect.” In fact more customers are asking for the service from the retailers they most often frequent. It’s a hybrid shopping experience: Customers can purchase an item anytime anywhere and then pick it up at their convenience at the retailer. Using this delivery model, a retailer can cultivate a convenient, streamlined image to the busy consumer; in addition, some stores are quite adept at drumming up related sales — upselling — at the time of pick up.
Apple Pay rolled out last month just in time for the holiday season and the flurry of purchases that accompany it.
According to Apple, more than 10 million iPhone users are able to make purchases at 220,000 U.S. retail locations using Apple Pay. Though Walmart, Rite Aid and CVS have rejected Apple Pay in favor of the yet-to-launch CurrentC, reports from Whole Foods that more than 1 percent of transactions are made with Apple Pay indicate that the newest digital wallet is already changing how Americans shop and buy.
Addressing customer concern over recent high-profile data breaches, Apple pay uses a combination of physical security and tokenized account processes. When a consumer uses Apple Pay, a temporary account number, advanced encryption chips in the phone and the customer’s fingerprint are all used to complete the purchase.
Apple Pay has a fight on its hands it seems. Drugstores CVS and Rite Aid have disabled the tech giant’s new digital wallet service in its stores, according to reports. Both retailers are part of a consortium of merchants who plan to offer their own payment system, CurrentC. Developed under the Merchant Customer Exchange (MCX) consortium which includes Walmart, Target and Gap as well as CVS and Rite Aid, CurrentC is positioned to rival Apple Pay and Google Wallet. It seems the battle for customers’ digital wallets has begun.
A new survey from retail technology company POPcodes has found that 86 percent of consumers who order products online and pick them up in store want to avoid shipping fees.
The poll of online shoppers conducted by POPcodes, which offers a cloud-based platform that integrates e-commerce systems and in-store payment terminals through a redemption code tied to a phone number, also discovered that 57 percent of consumers use the “order online, pick up in store” option because they believe it makes returns and exchanges easier. Though the option is not yet widely available, four out of 10 respondents said they have picked up an online order in person.
Gregg Aamoth, CEO and co-founder of POPcodes, said the survey findings show that even in the age of Amazon, consumers are still hesitant to abandon brick-and-mortar retailing.
“This survey reiterates what many of us in the retail world already understand: The Internet has certainly changed the way consumers shop, but they will always have a special place in their hearts – and wallets – for shopping in a store,” Aamoth said. “Retailers simply have to figure out how to better tie the virtual and physical shopping worlds together.”
Three-quarters of consumers admitted online shopping is more convenient, but they cited a number of different reasons why they still shop in store. Eighty-two percent said refunds and exchanges require more time and effort when shopping online, 72 percent said delivery costs too much or takes too long, and 60 percent said they like to see and feel what they are buying.
Retailers also have an incentive for offering a seamless experience for consumers who prefer to buy online and pick up in store. Two out of every three survey respondents said that they would shop for additional items when picking up a product in store, offering brands an opportunity to upsell customers. Consumers would be more likely to pick up online orders in store if they are offered special pricing (79 percent) or items are waiting for them when they arrive (64 percent).
The survey also revealed how receptive shoppers are to using an online payment to in-store pickup model: 97 percent of consumers who have chosen that option said they would do so again.
“What this tells me is that consumers crave a solution that bridges the gap between the virtual and physical shopping experiences,” Aamoth added. “That’s one of the reasons we’re launching POPcodes – to simplify and streamline the process so that consumers have more options and can seamlessly transition from online to in-store shopping.”
Founded by veteran retail executive Aamoth and entrepreneur Glenn Yuen, POPcodes enables omnichannel retailers to deliver a unique customer experience at a critical transition point on the path to purchase – when consumers shop online but desire to pick up their purchases in a local store. POPcodes collects key data on consumers’ online shopping behavior and connects that data to their cell phone number. Once in store, where over 95 percent of purchases occur, consumers can quickly retrieve a proof of promotion or proof of purchase and seamlessly continue their shopping experience.
Through its innovative solution, POPcodes improves the consumer experience, increases online conversions and drives foot traffic to retail locations.
A retail technology startup launched at the Money 20/20 conference has developed an omnichannel redemption solution that enables customers to purchase products online and pick them up in store.
POPcodes, a Canada-based company led by North American retail executives, bridges the gap between ecommerce and physical shopping by giving consumers a code when checking out online, which they can then use to redeem purchases or promotions at the cash register.
Because POPcodes integrates with existing ecommerce platforms and in-store point-of-sale systems, it supports the entire “clicks to bricks” customer journey.
By entering their verified phone number and three-digit passcode – their personal POPcode – when in store, customers using POPcodes can redeem an online order or generate a proof of promotion at any participating location without having to print out their order confirmations or showing a photo ID.
Through POPcodes' online API, merchants can create a proof of purchase or proof of promotion that sends data related to the consumers' online transaction or registration for an online promotion to a variety of function-specific POP templates. These enable merchants to send a range of content (including location data, product and pricing information, product suggestions) for display and also for in-store output on demand.
There is a multi-trillion dollar gap between the online and physical shopping worlds - and POPcodes, officially launched today at the Money 20/20 conference, looks to be the bridge.
The way POPcodes works is customers get a simple and secure code (typically online although they could be used in offline collateral as well) from participating retailers and are able to use that code to redeem purchases or promotions in-store, either when at the cash register or through any in-store device connected to POPcodes (like associates using iPads or at an in-store kiosk).