FOR RELEASE SEPTEMBER 2

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FOR RELEASE SEPTEMBER 6, 2006
Contact:
Lauren Freedman the e-tailing group, inc. 1444 W Altgeld St.
Chicago, IL 60614 773-975-7280 lf@e-tailing.com
THE E-TAILING GROUPS 3Q 2006 BUY ONLINE/PICK-UP IN-STORE EXPERIENCE: SAVVY MERCHANTS ARE THINKING CROSS-CHANNEL THOUGH MULTI-TASKING AT RETAIL CAN BE MULTI-CHALLENGING Based on consumer demand, savvy merchants are presenting themselves as cohesive and consistent cross- channel brands, Lauren Freedman, President of the e-tailing group, inc. reports relative to the firms most recent research findings. Merchants will ultimately have to make the requisite investments to integrate
systems and coordinate marketing efforts in order to offer customers such unified experiences. At the e-tailing group we believe buy online for in-store pick-up is so important to consumer convenience that last year we introduced a proprietary study where we sent our mystery shoppers into stores to test it behind the scenes. Freedman explains. This year we expanded upon their mystery shopping with
additional benchmarks to further understand the process of buying products online for in-store pick-up. Eighteen merchants, who offer this customer convenience, were each shopped twice, testing the overall customer experience in large and small store formats for comparison and consistency. A report, Expectations of the Cross-Channel Customer: Convenience and Control from Online to In-store is being offered for sale by the e-tailing group. It provides an overview of the state of multi- channel shopping highlighted by customer feedback from the Multi-Channel Shopping Transformation
Survey, along with a complete review of the buy online/pick-up in-store mystery shopping study including over 50 benchmarks, detailed merchant findings, best practices, and top performers; culminating with integrated checklists to ensure a complete cross-channel experience.
In store pick-up excellence - merchants of note Among the merchants mystery shopped for in-store pick-up, five stand out and deserve recognition for having product ready and waiting, friendly associates, and efficient use of email within the process.
Moreover they exhibited these practices of note:
Borders/Amazon In an effort to save the sale (when we said we wanted to return the book) the
associate asked if we were interested in other books by the author
Circuit City Dedicated parking for in-store pick-up with excellent signage and 24/24 branding message
integrated onsite and in-store (if an order is not ready for pick up within 24 minutes the customer is given a $24 gift card)
Golfsmith Frequent buyer program front and center to reinforce cross-channel loyalty/rewards

Ritz/Wolf Camera Signage on exit door: Order prints online@ritxpix.com - pick up in one hour
Sears Kiosk monitors associates delivery of merchandise within five minutes; failure to do so generates an apology gift card 2

Cross-channel thinking starts with the store locator As retailers realize the importance of store locators as a destination, an increased amount of merchandising is being seen in this area with 56 percent of merchants using it to highlight promotions
versus 27 percent in 3Q 05. Locators are also becoming more robust with 50 percent of these merchants including specialized departments, categories or services (vs. 40 percent 3Q 05). RETAIL LOCATOR e-tailing 100 3Q 06 18 merchants e-tailing 100 3Q 05 15 merchants Phone # 100% 100% Directions to location 94% 100% Map 94% N/A Store hours 83% 80% Check store inventory 53%* 47% Promotions in locator 56% 27% Specialized departments, categories or services 50% 40% *based on a subset of metrics source: the e-tailing group In-Store Pick-Up Mystery Shopping Studies
From inventory to systems, execution challenges still exist While an increasing number of merchant sites allow shoppers to check inventory at the store level (53% 06 vs. 47% 05), 43 percent of the time items we were interested in were not available for store pick-up.
With more merchants getting into the buy online, pick-up in store game, the availability of same day pick-
up has decreased (56% 06 vs. 67% 05) because the merchandise is not always readily available at the store location, but shipped from a warehouse or vendor.
Although only a disappointing 39 percent of the merchants stated the time allowed to pick up merchandise ordered, wise merchants are extending this allotment to 14 days (43% 06 vs. 30% 05) as they understand that although busy customers may not always be able to get to the store immediately;
there is value in waiting for their arrival.
In the order process communication about in-store pick-up has room for improvement Email order confirmations were consistently received from 100 percent of the merchants this year and last, but just 61 percent sent a subsequent notification via e-mail that the merchandise was ready for pick-up while 28 percent did so by phone. Of the applicable sites (photo stores not included), 36 percent
also sent an intermediary email advising that products ordered had been shipped to the store.
Beyond providing the store location and contact information (100%) the informational content in these
ready for pick-up notices varied greatly with just 56 percent including process instructions; the store phone number (67%) or store hours (14%). Tech-savvy merchants (17%) added a barcode to their online pick-up confirmations in hopes of expediting the in-store experience. 3 ONLINE ORDER PROCESS e-tailing 100 3Q 06 18 merchants e-tailing 100 3Q 05 15 merchants Check store inventory 53%* 47% # of out-of-stock items encountered 43% N/A Email order confirmation 100% 100% Barcode included 17% N/A Email shipped to store 36%* 27% Phone notification: ready for pick-up 28% 27% Email notification: ready for pick-up 61% 73% Same day pick-up available 56% 67% Store locations/contact info given 100% 93% Pick-up instructions included 56% 68% Store phone # included 67% 60% Store hours included 14% 13% *based on a subset of metrics source: the e-tailing group In-Store Pick-Up Mystery Shopping Studies The in-store experience is a chance to connect with customers Positively, products were ready and waiting 92 percent of the time vs. 87 percent last year and counters
were easy to find (71% 06 vs. 60% 05). But, merchants are moving away from designated counters (28% vs. 30% last year) to a general cashier scenario (44% vs. 37% last year).
Associates were able to locate products in less than one minute 68 percent of the time despite wait times
being up slightly (3.64 minutes vs. 3.5 minutes last year). Overall they were more business-like though unfortunately their less-than-friendly approach failed to establish any connection with the customer (47% 06 vs. 63% 05). More associates were taking on multiple tasks while servicing us (58% 06 vs.
30% 05). Most importantly, this multi-tasking nature took away from associates interest in saving the sale which we experienced at only 26% of the store pick-up experiences.
Checklist excerpts The complete e-tailing group report includes checklists with over 40 tips for best-in-class cross-channel shopping. Here are our top ten recommendations that apply to efficient in-store pick-up of products
purchased online.

1. Create a robust store locator with store hours, events, locations, mapping and merchandising.
2. Enable website real-time inventory accessible at the store level when the pick-up option is chosen.
3. Consistently send email notification when merchandise is available for pick-up; include detailed
information from the process to the store address, phone number and hours of operation along with promotional offers.
4. Include a barcode in the email for ultimate store efficiency.
5. Strive to have merchandise available for pick-up within 24-48 hours from the order date.
6. Train associates about your in-store pick-up process as well as to up-sell and cross-sell products/services rather than just ringing the register.
7. Pick-up counters should also be able to accommodate returns and signage should clearly direct customers to the designated areas.
8. From store-to-store locate pick-up counters as consistently as possible. 9. Allow at least 14 days for pick-up and provide flexibility if customer is unable to meet the deadline.
10. Have the merchandise available and ready; keeping wait times under five minutes. 4

Merchants who are thinking about offering or improving their in-store pick-up process can purchase the report, Expectations of the Cross-Channel Customer: Convenience and Control from Online to In-Store from the e-tailing group for $695 by contacting Lauren Freedman via email at lf@e-tailing.com or by phone 773-975-7280.
Retailers included in this study were: Ace Hardware, Amazon/Borders, Best Buy, Circuit City, CompUSA,
CVS Pharmacy, Golfsmith, JCPenney, Linens N Things, Lowes, Mens Wearhouse, Office Depot, Payless Shoes, REI, Ritz/Wolf Camera, Sears, Walgreens; Wal-Mart Photo Center.
the e-tailing group, inc. is a Chicago based consultancy that provides strategic and e-commerce
merchandising solutions to merchants selling online as well as to firms targeting that market. #####

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