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Groceryshop wrap-up: Three ingredients for success you can cart home

As we “checkout” of Groceryshop for the week, we leave Las Vegas, carrying a basket full of ideas and puns to help propel you forward.  

When digesting so many morsels of information, we like to ask ourselves: What are the most critical ingredients to success based on what we heard? 

So, we boiled down the content from the week into a more palatable format (to accompany our recaps from the first and second days of the conference). We hope this helps you create your own list of ideas for the rest of the year and into 2023. 

  1. Supply chain and store operations remain the bread and butter for many retailers despite not garnering as much attention 

New technologies draw many of the headlines at events such as Groceryshop because they’re unproven and hold a lot of promise to deepen customer engagement. However, supply chain and store operations remain the hallmark of great retailing. 

After all, what good is a livestream shopping event if you cannot provide quality products to customers who shop in your store or if you cannot replicate a great experience across all your locations? 

Yael Cosset, Chief Digital Officer at Kroger, made this exact point during his presentation: the difference between “good and amazing” is about improving the store associate experience to drive consistency for the customer. For Kroger, much of the focus is around finding ways to drive consistency, particularly as the grocer attracts new customers in new markets through its digital-only strategy. 

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Kroger has invested in large, automated warehouses to enter new markets in the US through a digital-only offering; other retailers are using smaller automated systems — micro-fulfillment centers (MFCs) — to grow digital order capacity and reduce the cost to serve customers

A client from a regional grocer made a similar comment to us during the conference, noting that “we can sit around a table and come up with all these ideas that we think are great, but ultimately, it comes down to the people in our stores to make it happen for the customer.”  

Perhaps what is important to take away is that continuous (incremental) improvements in your supply chain and store operations are essential for providing a great customer experience.  

This may take the form of automation to increase your order capacity for curbside and delivery orders, providing new tools for store associates to better serve customers or just improving your demand forecasting to enhance your instocks. The key is to find new ways to improve your core operations while continuing to raise the bar on your customer experience. 

2. Many retailers (and consumer goods companies alike) are cooking up personalization initiatives as a way to grow market share  

If there was an initiative or focus area that was most frequently cited by speakers at Groceryshop, personalization might be it. 

Marissa Jarratt, the Chief Marketing Officer at 7-Eleven, called personalization “the buzzword of Groceryshop.”  

Large retailers have done the hard work of gathering their data in a centralized location to unlock all sorts of capabilities. This includes the ability to run a retail media network with defined audiences for ad targeting and now the means to create personalized offers for customers through the mobile app.  

[NOTE: If you have not created a data strategy and centralized the information yet, you may want to consider it a priority on your roadmap.] 

A challenge — or opportunity — for many retailers is that most sales come from stores which do not offer the same ways to serve up recommendations to customers at key decision points in the shopping journey as digital channels. Ideally, though, you would be able to present personalized offers to customers on their shopping trip or as they head down a specific aisle in a store.  

Some retailers —  most notably Kroger and Amazon —  are breaking ground on this capability with the data provided from beacons and/or cameras in the stores connected to the mobile app.  

Kroger has found that customers engaged in personalized offers via its Store Mode in the app have a 98% retention rate and spend almost double a regular customer. 

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Kroger’s store mode on its app allows for personalized offers to be sent to customers in the store
Source: Kroger

This isn’t just retailers, such as Kroger or 7-Eleven, though, that are excited about this potential. Emily Frankel, SVP of ecommerce marketing at PepsiCo, cited personalization (and measurement) as the areas she is most excited about in the coming year on the panel discussion about retail media networks. 

Given the technological capabilities along with incentives for retailers and CPGs alike personalization will be a key growth driver and accrue disproportionate benefits for those that can deploy the initiative in a manner that is non-intrusive to customers. 

3. There is an endless buffet of consumer technologies to remove friction from the store shopping experience, but none has emerged as a staple for retailers 

There are many service providers and retailers that are looking to reduce friction in the shopping experience for customers. We know from our research that eliminating wait times at checkout produces high customer retention and leads to market share growth for grocers that have an established customer value proposition. 

Just think about the last time you passed on a shopping trip because you knew you could not get in and out of a store in a timely fashion. Perhaps you got frustrated and have not gone back to a store in a while when you had to wait a long time at checkout.  

This is the pain point these technologies look to solve. 

Here are just some of the technologies aimed that were mentioned throughout the conference at dealing with this problem: 

  • Scan and Go 
  • Digital shopping carts 
  • Just walkout technology 
  • Automated self-checkout 
  • In-store navigation via app 
  • RFIDs on shopping carts 

There is no clear winner in this space, but there is lots of experimentation to find the best solution(s) for customers. Many of these technologies have yet to be embraced en masse by consumers, so nothing is fully baked, but the promise the technologies hold to improve the customer experience is important.  

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Instacart offers a smart cart to retailers that want to partner as part of its broader platform
Source: The Verge

Just as enticing for retailers is the ability to reduce labor costs at the registers (or to redeploy to other parts of the store) if customers adopt these technologies. Add to the fact that retailers can gather more valuable data from customers in the store and you can understand why this is such a hot topic.  

The benefit to customers and retailers alike is such that we can expect to see more tests and perhaps new technologies in this space until there is wider consumer adoption of any of the technologies. 


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