Loblaw introduces e-commerce commuter initiative

Loblaw Cos. today announced a partnership with Metrolinx where it will offer a new PC Express service in five GO Transit stations in the Greater Toronto area.

The service, which allows commuters to preorder groceries online for pickup during their next day’s commute, will debut at five GO Transit stations this spring and is expected to expand in phases to additional sites in the region.

According to company officials, the new service is an evolution in Loblaw’s successful click-and-collect model, where customers can already order online and pick up in a growing list of more than 200 Loblaws stores throughout Canada. By adding GO Transit stations customers will no longer have to adjust their daily travel plans to shop for groceries.

“This is a logical extension of our increasingly popular e-commerce services, and the growing customer appeal for ordering groceries online and picking them up when it is convenient,” said Jeremy Pee, senior VP of e-commerce at Brampton, Ontario-based Loblaw. “With PC Express pickup locations we’re giving customers and commuters the best brands and products we have to offer, easy online ordering, and some time back in their day.”

Starting this spring, customers who place an online web or app order by midnight will have the option of selecting from five PC Express pickup locations within GO Transit stations — Bronte, Oakville, Rouge Hill, Whitby and Clarkson — for their next-day, homebound pickup site. Depending on the location, the groceries will come from nearby Fortinos or Loblaws stores and will be waiting in a special delivery truck, in lockers or in an enclosed kiosk. Customers select a window of time to pick up their order during their evening commute.

A Loblaw spokesperson told Supermarket News that while item availability is dependent on the store and pickup location chosen, that vast majority of products available in-store will be available online.

“The payment for orders picked up at a GO Transit station is done online prior to pickup,” the spokesperson said. “At the time of pickup, the customer will use their order confirmation number to collect their order. If they choose to pick up from a locker they will use a PIN code provided by email to collect their order from their temperature controlled lockers.”

Because the lockers are temperature controlled, perishable and frozen items can be purchased. “There is also a freshness guarantee for all produce, so if a customer isn’t 100% satisfied with their selection they can call customer service,” the spokesperson said.

Initially, at stations with a kiosk the pickup time is going to be between 12 and 7 p.m., the locker pickup time frame is between 4 and 9 p.m., and the delivery truck pickup is between 4 and 7 p.m. “We will look at usage and customer feedback to continue to refine the offering,” the spokesperson said. The locker units are self-service, while the kiosk and truck pickups will have an attendant.

“The Canadian market has done more than we have in the U.S. in terms of providing remote pickup locations for groceries,” said Bill Bishop, chief architect of Brick Meets Click, a consulting firm based in Barrington, Ill. “The advantage of the remote pickup is that it reduces the cost of that final last mile of getting it into the hands of the customer,” he said.

Bishop thinks Loblaw may especially have success with the unmanned lockers.

“Almost everybody is trying to plan their business with as little labor as possible. I think the likelihood of this being a locker system where you get your code and then you get your purchase and go without human interaction is very good,” Bishop said.

David Rogers, president of DSR Marketing Systems, a consulting firm based in Northbrook, Ill., is reserving judgment on the Loblaw initiative, but questions its feasibility.

“Tesco tried something similar to this on the Underground in London a few years ago, and it was quietly phased out. There are all sorts of things that work well in theory, but not in practice,” Rogers said.

What can be successful is establishing a limited-assortment supermarket in the train station itself. That is what Marks & Spencer has done in London’s Paddington Station, Rogers said.

“In Paddington Station is a Marks & Spencer Simply Food. It is maybe only 3,000 to 4,000 square feet and just sells prepared meals, bottles of wine, sandwiches, soft drinks, waters, etc. When people hit the station between 4 and 7, they just buy dinner and take it home on the train,” Rogers said. “They just know what to carry there, and that works. People get their dinner and either eat on the train or take it home and put in the microwave.”

According to Bishop, more American retailers are also opening stores close to major transit hubs. He noted that the Whole Foods store in Manhattan’s Time Warner Center and its new Whole Foods 365 unit in Brooklyn’s Fort Greene neighborhood are both located at busy subway hubs.