35% of Pier 1 E-Commerce Customers Opting for In-Store Pickup

By Adam Blair — January 07, 2013

Pier 1 Imports has made a strong re-entry into the e-commerce realm. Having completed its first four months of full e-commerce operation in December, "traffic to Pier1.com has increased and is up in the high double digits with over one million visits per week, with customers spending nearly double that of our in-store customers," said Pier 1 CEO Alexander Smith during a recent conference call. "Customers are shopping broadly across our online assortments, and to date, have purchased over 90% of the available items."

While e-commerce sales remain a fraction of those conducted through Pier 1's 1,100 store locations, the retailer's return to e-commerce is having a broad omnichannel impact. Pier 1 had left the online sales arena in 2007, but since 2010 the retailer has been making a gradual return – part of what Smith terms the retailer's "crawl, walk, run" strategy.

An unexpectedly high percentage of online shoppers, more than one in three, are opting for in-store pickup of their items, which cuts the retailer's shipping costs and creates additional sales and data-gathering opportunities. "Our in-store pickup model is trending very well, with 35% of online orders being picked up in the store, allowing for further and enhanced interaction time with our customers," said Smith. "We're expanding our database, adding both existing Pier 1 Import shoppers for whom we are now capturing information, as well as those who are new to the Pier 1 Imports experience."

Market research indicates that 25% of customers browse the retailer's website one to two days prior to visiting a store. Smith expects this influence factor to increase as the retailer implements its new POS system and "further builds out our assortments to develop our converging and mutually dependent businesses." Pier 1 is planning a chainwide rollout of its new POS system to begin after the 2012 holiday season, with an expected completion date in summer 2013.

The digital sphere is also serving as a testing ground for the entire enterprise. Pier 1 is testing some online-only product assortments, "and you can expect to see us accelerate that effort over the course of the next year," said Smith.

"We already have pretty well-established testing strategies in-store, particularly on high-ticket merchandise to allow us to minimize markdown risk," said Smith. "We now have many, many more opportunities to use the Web for testing. And if we get a good response, we can always roll those products back into the store."

For related content: Pier 1 Invests in IT, Rolls Out POS

Pier 1 Earmarks Half its $75M CapEx Spend for Tech Investments

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