October 18, 2016 | Written by: Scott Holmes
Categorized: eCommerce & Merchandising
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Like many people, I enjoy discovering locally sourced produce or a new seasonal beer as I meander down the aisles of my local grocery store, yet time poverty usually forces me to forego these leisurely shopping experiences. We love living in Cleveland, Ohio; however, options such as Amazon Fresh, Instacart and Peapod tend to favor coastal markets. But this is changing. As my colleague Steve White notes in his piece Transformation in Grocery, online grocery sales will make up 20 percent of total sales within five years (a near 10-fold increase from its current 2.4 percent).
This forecast should inspire all grocery chains to aggressively invest in their digital presence—beyond click-n-collect, digital coupons, and digital circulars. Steve also reminds legacy players of the imperative to transform given the innovation we are seeing from new entrants such as Blue Apron and HelloFresh.
Scaling and delivering an innovative, on and offline cohesive customer experience is forcing grocery companies to weigh their options for investing in niche technologies versus a broader, more transformative enterprise solution.
My work at Razorfish, combined with conversations with multiple grocery chains, tells me that the industry is committed to delivering an integrated customer experience that provides value on multiple physical and digital levels. But getting to this integrated state requires a digital maturity that is currently constrained by:
- Limited product information that relies on stock photography and lacks any related content (recipe, seasonal information, etc.)
- Savings options that go beyond clipping coupons and flipping through a weekly circular that was designed for print usage
- Authentic recipes that reflect the brand’s promise and can easily be turned into shop-able items
- The ability to buy online and pickup in all stores
- The ability to purchase fresh foods, configured food items, and packaged goods together
- Ease at translating shopping lists into shopping carts.
- Effortless self-checkout options
Seamless and helpful experience
- Ease of transition for planning or purchasing across channels (desktop, mobile, store, etc.)
- Substitution handling with online orders
- Notifications that inspire, remind, and add enjoyment to grocery shopping
- Smart tips on picking produce
Where to begin?
Craft a comprehensive digital roadmap
Start investing in a robust technology platform that will enable early customer benefits while scaling across all stores. It might take years but rising competition from innovative startups and high consumer expectations means you must start now.
Examine your mobile approach
Fragmented mobile apps and mobile sites can’t continue given the prediction In his article, Steve cites that “Mobile will influence $1 trillion in U.S. retail sales and consumer spending. Influence from digital channels alone will grow from $1.2 trillion to $1.6 trillion by 2020.” Between this and rising shift towards online sales, grocery companies must invest in developing a more connected and advanced mobile experience.
A mobile first customer engagement strategy needs to be at the center of everything that a grocery chains are doing to interact with their customers, as it provides the opportunity to start delivering customer benefits today. Look towards iterative mobile rollouts to provide your customers with added benefits while you evolve technology systems and store operations to compete.
Define Your Paths to Maturity
Razorfish solved this problem for one of our clients by leveraging the IBM MobileFirst solution and the Bluemix cloud-based development platform, allowing us to develop a custom app on top of a legacy backend that will dramatically improve the customer experience.
Bluemix enables an architecture that seamlessly leverages new and emerging services while also integrating with legacy services to enable even greater customer benefits. As Brandyn Brosemer, Mobile Development Lead at Razorfish notes: “IBM Bluemix provides technologists a simple approach to building mobile application imperatives, such as push notifications, over the air content updates, and scalability, with the flexibility of a custom application server.” This type of agility also lets you take advantage of recent innovations from Apple (e.g., Messages Framework) at a faster rate.
Figure 1. This Razorfish engagement crafted a mobile rollout in parallel with a vision for an updated technology platform.
Always put innovation top of mind
Use this strategy to accelerate your speed to market with innovative customer experiences while laying the groundwork for a complete technology solution. Mobile innovation will enable grocers to serve smaller markets. Small innovations to ease the planning process, shopping, purchasing, and enjoyment of food will go a long way to delighting your customers. As with any idea, be clear on how investments in innovation will help you compete in the 21st century against traditional and new players. Make sure someone on your staff is always thinking five years ahead to the next innovative wave. Otherwise, you’ll always be catching up versus leading the market.