Parcelly Thought Leadership Corner: WHY CLICK&COLLECT ISN'T SUCH A DODDLE AFTER ALL

by Sean Fleming
@flemingsean

On the morning I sat down to write this column, I saw a mother duck walking down the middle of the street where I live. Behind her was a neat little line of four ducklings, all fluffy and delightful in that way ducklings tend to be.

Behind the ducklings, following with patience and determination, was a magpie.

It was abundantly clear what was going on here; should the rearmost duckling fall off the pace the magpie was ready to snatch it. A grizzly and unpleasant end. I was reminded of the poem In Memoriam, written by Alfred Tennyson, which refers to nature, red in tooth and claw.

It also got me thinking about business and entrepreneurship, which - like nature - can be brutal at times.

During my time as editor of the ecommerce fulfilment publication eDelivery, I wrote about Doddle several times, and often spoke to its CEO, Tim Robinson. Back then, I felt Doddle was an important part of the new delivery landscape and a shining example of applying new thinking to existing situations. When I read of the recent problems afflicting Doddle, and the decision to begin closing stores and letting staff go, I was greatly saddened.

But was that the right response?

After all the commercial world - just like the natural world - is red in tooth and claw, isn’t it? If you’re the slowest duckling you’re a snack-in-waiting for a hungry magpie.

Well, yes. But also, no.

I’ve read many of the press articles on what happened but I don’t have access to any inside information, so I can only speculate about what went wrong for Doddle. But some things stand out more clearly than others.

For example, retail space in prime locations is expensive. I realise that remark may win me a prize for stating the obvious.

Doddle set up shop in some fantastic locations, and while I’ve no idea what the actual rent may have been, from Canary Wharf to King's Cross, Westfield Stratford to Westfield White City, high rents need to be fed by healthy revenues.

Yet stories abound about the lack of footfall at Doddle stores, despite being within eyesight of millions of people - mostly commuters - day-in, day-out.

According to Business Insider, “In 2015, its first full year of operation, it lost more than £24 million — while pulling in less than £700,000 in revenue across dozens of stores.”

Parcelly DoddleBlogPost 2017

One of London's busy railway stations

 

Human nature or human inertia?

Rightly or wrongly, it has often seemed to me there were two schools of thought on the new generation of Click & Collect offerings. One was mostly concerned with the potential use of drones (wheeled and air-borne), and the other around routing parcels to collection points for people to pick them up.

I’ve always felt the latter made more sense. I also felt that the Doddle strategy of opening stores in or near railway stations made perfect sense. You don’t need to educate the market when you’re offering collection in a railway station. People just get it. That’s what I thought.

It’s precisely the same reason I think independent stores make perfect Click & Collect locations. People know how to use their local shops. You don’t need them to completely reinvent the way they behave in order to get them into their newsagent to pick-up or drop-off a parcel.

Convincing large numbers of people to accept robo-delivery is - in my opinion - a much bigger ask; people are resistant to change. So, don’t fight human nature - you’ll lose far more often than you’ll win.

But maybe there was something lurking in human nature that explains why Doddle wasn’t a runaway success. People in railway stations are already engaged in a time-pressured activity - catching a train, going to work, or going home. Stopping off en-route to try on some clothes, have a drink, and enjoy a retail experience while collecting something you ordered online is time consuming and may involve breaking your normal routine. If I’m right when I assert that people are resistant to change, therein lies a considerable challenge.

Home delivery is still a thorn in the side of retailers and shoppers alike. When it works, it’s great. When it doesn’t, it’s a real problem - costly and disappointing. There’s no middle ground.

Click & Collect is the only alternative that puts control in the hands of the shopper and lets them decide what convenience means to them.

Did Doddle over-reach? Maybe. But while one shouldn’t be too harsh about their ambition, the reality is that putting a small number of outlets in the paths of millions of people who are mostly hurrying to and from work, and hoping they would take a time-out to pick up their shopping, may have been an unrealistic goal after all.

The demise of the Doddle Runner service may have been a bit of a metaphor; the feet-on-the-street idea sounded great - someone running through central London to make a delivery faster than alternative transport methods. But the reality was that the runners weren’t allowed to run.

The future for Doddle looks likely to be based around smaller kiosks and collection counters in retail partners’ stores; a smaller, less ambitious approach. Whether that will be enough to build a sustainable business time alone will tell.

Perhaps its chief legacy to the rest of the retail fulfilment sector will be that you should start with modest, achievable aims. That you should walk before you try running.

And that you should always watch out for hungry magpies.

 

Sebastian Steinhauser, CEO & Founder of Parcelly highlights: "We believe that consumers want control and certainty over their deliveries. As this did not exist in a scalable, social, or environmentally friendly way, Parcelly was born in December 2014. Click & Collect already existed at the time, but it wasn’t agnostic, and it certainly wasn’t mobile. These are some of the key elements that nowadays are not only requested by, and beneficial for consumers, but are also just as important for online retailers and carriers as well. Furthermore, to make the Parcelly model scalable, cost efficient, and easy to maintain and develop, we embarked on a journey to convert redundant space in businesses and private individuals’ homes into parcel storage. Rather than investing in physical hardware and property, we wanted to utilise what was already available, so that it could be used to serve local communities and generate additional revenue for businesses, whilst having a significant positive environmental impact.

Back in 2014, just a few days before Parcelly’s official inception, Doddle launched with its big, bold, purple brand, promoting dedicated parcel shops in prime locations all across London. Not only did this model oppose our mantra to support local high streets and particularly businesses across the country, but it also seemed to cloud the expectation levels of many online retail and carrier partners we were talking to at the time. Logistics is a low margin business, and this requires a sustainable and lean business model to make it work. Contrastingly, Parcelly continued to focus on its network growth through partnerships, expanding nationwide with more than 1000 Parcelly locations in more than 50 cities. Indeed, Doddle’s main advantage seemed to be its biggest burden: the bespoke and branded parcel collection experience Doddle envisaged, and promoted, never attracted the thousands of subscribers nor the millions of parcels needed to make their model fly. Some might say, this had to be expected in a world where consumers realise that deliveries do not need to be for free, and neither do they need to be collectable from an expensive high street parcel shop.

We do not mind that Doddle has pivoted to Parcelly’s business model, a space we have owned for more than 2 years. However, we do feel for the Doddle employees that will lose their jobs in the coming months due to mismanagement, and also the retailers that have been misled about what they can expect in today's cost and CSR conscious e-commerce environment. It seems the Doddle leadership team has realised their mistakes, but given their latest statements, only future will tell whether they have learned from them."

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