The consumer shopping journey is under constant tweaking, revision and improvement in the modern retail environment through the use of technology, including smart shelf labels and artificial intelligence.
What Factors are Driving the Change?
Because of a growing consumer demand for experiences like personalized advertising and online grocery shopping, technology is reaching new heights in the grocery industry. Phononic, which offers colling solutions, discovered that 89% of shoppers want to buy from a savvy, efficient supermarket. In a related discovery, the Food Marketing Institute and Nielsen recently discovered that 70% of grocery shoppers will shop online in as little as the next five or seven years.
“The grocery industry is currently in the age of digital experimentation, where the roadmap on how to navigate and achieve real and profitable growth continues to evolve,” Nielsen’s Chris Morley said in a statement. Analytics will be key to comprehending the ever-changing digital shopper, according to Morley, is an integrated approach to physical and digital techniques.
Also, John Karolefski, a grocery analyst, says that as more millennials buy groceries, grocers are having to improve their tech game. “One of the ways they’re doing that is to focus on shopper-facing technology,” he said. Retailers are making room for more technology with breakthroughs such as Kroger’s digital shelf technology and Amazon Go, a cashier-less store from the e-commerce behemoth.
The Next Generation of Technology?
Retailers such as Walmart seem to be on track to the future of retailer with greater use of autonomous robots, which search for misplaced items, missing labels, and stocking needs.
Meanwhile, Farmstead, which sells itself as the nation’s first sustainable digital grocer, uses AI to estimate the amount of food it should order from local providers to reduce or eliminate supply chain waste. Also, Ocado, a British online retailer, uses AI and machine learning to prevent fraud identify which customer communication needs immediate attention. Data is also being used for greater efficiency by delivery services like Instacart.
Instacart gets data and cloud services from Snowflake Computing in order to improve its back-end operations, customer service from engineers.
“Our food delivery customers are leveraging data and machine learning to build loyalty, trust and convenience among shoppers through personalization, price matching and more informed recommendations to shoppers — all without impeding on people’s privacy,” said Matt Glickman, vice president of customer and product strategy at Snowflake Computing in Smart Brief.
What Could be Coming in the Future?
Grocers are certainly embracing technology. Walmart launched a research office for tech in Texas to focus on improving operations and bringing more technology to stores. Likewise, Ahold Delhaize announced last week that it plans to team up with a Dutch research group to learn about how artificial intelligence can offer superior recommendations to shoppers and improved supply chain management.
Chris Hjelm, Kroger’s Chief Information Officer, said in The Wall Street Journal that putting tech in brick and mortar stores is critical, and that is what his company is doing.
“We’re in the midst of deploying our video-management system, with new cameras that are all digital, and analytics technology to understand what we’re seeing,” he said. “We’re running a pilot to do service queuing for the pharmacy, meat department or deli.”
Robomart wants to change the grocery industry by offering to-door delivery via a self-driving, fully-stocked vehicle. The startup has also made its interest in engaging with retailers to lease the technology clear. Karofski said that grocers who find the balance between a smooth experience and customer engagement through tech are well-positioned.
“While [grocers] want to engage them and get them involved in the store, shoppers want to get in and out of the store quickly,” he said. “Technologies that facilitate that have a better chance of succeeding.”
“We’re going to see more tests of interesting technology, but it will remain to be seen if shoppers like it or not,” he said.