Future of Retail

Date Check Pro and Agilence Present: “Reinventing Grocery | The Timeline to New Normal”

Date Check Pro and Agilence Present: “Reinventing Grocery | The Timeline to New Normal” 1800 945 Natalie Tatum

Pinpoint Software, Inc., provider of the leading expiration date management solution for grocery stores, Date Check Pro, and Agilence, Inc., the leader in data analytics and operational reporting, today announced their upcoming webinar “Reinventing Grocery | The Timeline to the New Normal” that will take a closer look at the emerging trends across the grocery industry post-COVID 19. This webinar will be held via GoToWebinar on April 28th from 2:00 to 3:00 ET. To register and reserve your spot, sign up here.

With a combined 40+ years of grocery retail experience this webinar will be hosted by Pedro Ramos, Vice President of Sales for Agilence, Inc., and Andrew Hoeft, CEO & Founder of Pinpoint Software, Inc. 

This new co-produced webinar delivers grocers a data-driven perspective as permanent disruption unfurls within the grocery retail experience. It will cover the role cleanliness and safety protocols will arise as a key driver to sales, how former “slow moving” categories may be worth further investment, the role your associates play in future customer acquisition and retention initiatives, why a familiar business adjective to the grocery industry may emerge as a direct competitor, The DNA of the New Shopper, and more. 

“We know what COVID-19 did to grocery operations in the present; surges in online and curbside pickup orders, critical focus on cleanliness and safety, and larger, less frequent grocery orders. But what about the longer term impacts? We are excited to have teamed up with Agilence to glean knowledge from our collective data to help guide as well as predict where our industry is headed over the next several months and years.” says Andrew Hoeft, CEO at Pinpoint.

“This webinar is a natural extension of our partnership with the team over at Pinpoint Software,” said Pedro Ramos, VP of Sales at Agilence. “Both of us have strong ties to the grocery industry and we are seeing the frontline impact of COVID-19 on grocers of all sizes. Our plan is to present grocery professionals with data-driven concepts that they can incorporate into their business today, tomorrow or in the near future.”  

Grocers and grocery industry professionals of all titles such as operations, category management, merchandising, loss prevention and marketing leaders looking to better understand the future of the grocery industry following the coronavirus outbreak are encouraged to attend the webinar. 

For more information on Date Check Pro, visit datecheckpro.com. Pinpoint Software, the organization behind Date Check Pro, is a venture-backed technology company, located in Madison, WI, dedicated to improving operational efficiencies through software. Their products also include Taskle, and Stop Waste Together, a non-profit initiative aimed at reducing food waste.
For more information on Agilence, visit agilenceinc.com. Agilence is the industry leader in data analytics & reporting for retail, restaurant, grocery  and convenience organizations. Agilence develops a highly flexible and powerful cloud-based analytics & reporting platform that provides organizations with a complete view of their business, empowering them to make informed decisions faster, increase sales, and eliminate losses. Agilence, Inc. is headquartered in Greater Philadelphia.

 

How Shopper Behavior Has Changed During COVID-19

How Shopper Behavior Has Changed During COVID-19 1644 1085 Natalie Tatum

In a recent report from Acosta, researchers found that two-thirds of U.S. shoppers said they have changed their grocery shopping habits in response to the COVID-19 outbreak. The report, Grocery Shopping during the COVID-19 Pandemic, dives into how shopper behaviors have changed in recent weeks following stay-at-home warnings and the panic-buying that’s associated with the coronavirus outbreak. To best understand this information, let’s take a look back at grocery shopper behavior in 2019. 

In 2019, one of the biggest trends in grocery was the shift in dietary needs. “One third of households have at least one family member following a non-medically prescribed diet, and this rate is higher for younger generations,” said Leslie G Sarasin, President and CEO of FMI. This shift changed the grocery landscape by influencing grocers to expand their natural and dietary restriction sections in the store and helped introduce new products on the shelves that fit the new needs of their shoppers. The other leading trend in 2019 was online grocery shopping, with  roughly 43% of shoppers got their groceries online, and visited the store 1.7 times per week, higher compared to the national average of 1.6 trips per week 

Both of these trends were expected to grow in 2020, but nobody could have predicted that a global pandemic would be the reason that both trends went off the charts. 

One of the most grappling statistics of the report is that two-thirds of U.S. shoppers said that they have changed their grocery shopping habits in response to the coronavirus outbreak. Comparing March 20-29 to March 6-12, shoppers in all age groups reported making significant changes in the way they get their groceries. The leading age group making changes was the Gen Z & Millennial shopper group, with 68% of those surveyed changing habits. They were followed closely by Boomer shoppers at 64%, and Gen X followed them at 64%. 

In addition to changing their grocery shopping habits, 72% of those surveyed shared that they have been implementing new behaviors like social distancing, a trend even some grocers have picked up on with the introduction of one way aisles. 70% of individuals surveyed said they have been avoiding public areas, and 64% said they have been sheltering in place and at home. 

Acosta also reported that top categories are changing, recording that 44% of shoppers are buying canned foods and shelf stable foods like rice, pasta, and beans, and more paper products. 36% of shoppers are buying more household cleaners and disinfectants and 36% are buying bottled water. 

Unsurprisingly, 9 out of 10 shoppers experienced out-of-stocks during their most recent grocery trip, with 47% of shoppers saying that they were able to find some sort of substitute for items that were unavailable. 

Acosta concluded their report with helpful tips for retailers and manufacturers during this difficult time, including suggestions on implementing new solutions that reduce the risk of shopper and employee transmission of the virus with shields, re-establishing inventory of core items, and providing creative, budget friendly meal solutions in store and online. 

For more information on the report and best practices during COVID-19, click here

 

How COVID-19 is Affecting the Grocery Industry

How COVID-19 is Affecting the Grocery Industry 1540 862 Natalie Tatum

Almost every industry has been affected by the COVID-19 pandemic. Restaurants around the country are almost entirely operating on a to-go-only basis, the travel industry is at a standstill, and retail has gone completely digital with over 90 major U.S. retailers temporarily closing. While many industries are struggling, the grocery industry is seeing the opposite problem. 

For those working in the grocery industry, you don’t need the news to tell you how crazy day-to-day sales have been during the COVID-19 breakout and related hoarding buying habits (does anyone actually have toilet paper yet?). As grocers scramble to keep their shelves stocked, we can’t help but wonder what impact this will have on shrink once COVID-19 has passed. 

Normally, the average grocery store has more than 1,600 expired items on their shelves in the dry grocery department alone. Now that stores have sold through most of their inventory on shelf following the COVID-19 spike in sales, those expired items have mostly been cleaned out. What is the best way for grocers to put together a plan to maintain this new level of freshness before expired items pop back up in stores? Date Check Pro has the answer. 

What Stores Should Expect From Expired Food 

In times of stress like this one, buying habits obviously start to change. While customers once bought a few items to get them to the weekend, they’re now stocking up on anything and everything they can get their hands on. Grocers expect to sell out of the basic items like: bottled water, chicken, meat, non-perishables, canned goods, milk, bread, and eggs, as well as cleaning products like Clorox wipes and disinfectant spray. However, the introduction of “panic shopping” has shown a trend in more unconventional products being sold in mass volumes. 

According to data from Agilence’s grocery reports, items like Sharpies and printer ink have seen a 10,000% increase in sales. Date Check Pro was able to talk with Raoul Ricard, VP of Business Development at Agilence, about what trends grocers are experiencing and what changes they can expect to see in the coming months:

DCP: What data has been most interesting to follow?

Raoul Ricard: “We’ve seen noticeable waves in our grocery data but it changes from region to region – even county to county in some cases. Four weeks ago, it was business as usual. Like everyone else, we started to notice toilet paper & napkins flying off the shelves but starting this week we’ve begun to see the trend of ‘replenishment.’ Consumers are now already stocked up on the essentials but they are returning to grocery stores for perishables and the other items they didn’t necessarily buy enough of. Deli items for making lunches for school age children continue to be a necessity as time goes on with the pandemic. What’s really been interesting is the weekly change in behaviors as this progresses. From normal business, to stocking up (canned/boxed foods and paper products), to work from home and school set up (General Merchandise), to replenishment (lunch for the kids, apple juice, bread etc.), and alcohol maintaining its increase.”

DCP: What unexpected items are selling out or spiking in sales at a time like this?

Raoul Ricard: “We have noticed that items like school supplies are way up in most grocery locations because most consumers are trying to condense how many locations they are physically shopping at. Products for homeschooling, such as notebooks, pens and pencils have dramatically increased in sales.”

With store inventory essentially wiped clean several times over, expired shrink will be low over the next few months. While shrink is normally stable throughout the year with only a few small fluctuations present, COVID-19 will greatly skew those numbers, especially since grocers don’t currently have labor hours being used to look for what’s left. Once stores are able to get back to their normal operations and sales return to normal levels and most frequently bought items, expired items will start to build up again. 

As shrink levels are down, grocers should feel comfortable pulling back from their spot checking schedules and rotation requirements. While close dates are still going to be present, the overwhelming surge in sales and speed of selling out doesn’t provide an efficient opportunity for spot-checkers to accurately report data. Products in the dairy and meat section can probably be skipped for about one month, and grocery can be skipped for about two to three months. Once shrink starts to ramp back up, spot checking schedules should return back to normal, especially with the high volume of dates that will need to be entered. 

How Long Before Expired Shrink Returns?

Take a look at one of our case studies with a mid-sized grocer starting from the day their store opened onward. Looking at a brand new store with completely fresh inventory is the best model we have to compare with today’s COVID-19 impact on inventory. From the data, we’re able to see expired shrink (in units) in a given month across three different departments: dairy, grocery, and meat. For each department, we see a build up each month, followed by a single month peak, and then relatively consistent expired shrink levels each month after. As you plan out resources for post-COVID-19 recovery, keep these timelines in mind for when labor hours should return to spot checking and proactive expired shrink prevention efforts:

  • Processed Meat – 2 months
  • Dairy – 3 months
  • Grocery – 5 months

How Date Check Pro Can Help 

With shelves being cleared and products being cleared from the system, there’s a clean slate for introducing or ramping up the way that your store manages expired food. For a short period of time, grocers are able to take advantage of the above trends to implement Date Check Pro at far lower than normal costs and move into the future more confident than ever in the quality of food being sold to shoppers. 

If you’re interested in learning more about how Date Check Pro can help your store feel free to set up a quick, 30-minute phone call or demo with one of our team members by filling out the information here.

How Personal Utility is the Future of Retail

How Personal Utility is the Future of Retail 638 359 Natalie Tatum

With speakers from Walmart, Starbucks, Nordstrom and more, NRF 2020 showcased many different thoughts and ideas about what the retail landscape holds for 2020 and beyond. With the rise of micro-experiences and attempts to redefine customer service to foster more intimate relationships between companies and their consumers,  many industry professionals are citing personal utility as the driving factor behind retail’s growth. 

Researchers from PSFK in New York produce their annual Future of Retail report to provide strategic roadmaps for brands and retailers to deliver hyper-personalized service that meets the unique needs of every shopper in a post-experiential era. In the session ‘Humans are back: Why companies are putting a premium on the human element in the digital age,’ with PSFK President and Founder Piers Fawkes, Fawkes dives deep into the ways that any industry can harness feedback and machine learning to meet and anticipate their shoppers needs. 

Personal Utility:

Personal utility is the advanced computing, delivery logistics, and connected tech powering a hyper-personalized retail experience with the objective of anticipating and providing exceptional service. Retailers deliver personal utility through five categories: Inspire Me, Meet Me, Serve Me, Value Me, and Know Me. Each category Fawkes highlights here is broken down into detailed examples of those already doing it well and additional research and statistics that are pertinent for each delivery. Let’s take a closer look at the five personal utility categories:

Inspire Me: provide me with personalized recommendations and curated content to help me discover and choose the right products for my needs. 

We all know how difficult it can be to articulate your desires to an untrained or uninterested sales associate who might not know anything more on what you’re looking for than you do. L’Oréal solves this problem through Color & Co., a service that provides digital one-on-one consultation calls that help consumers pick out the best L’Oréal product for their specific need at the recommendation of L’Oréal experts and professionals. By providing expert care and advice, consumers are left feeling that their desires were heard, validated, and resolved beyond expectation. 

Meet Me: integrate shopping into my daily life, providing me with access to the goods and services I need in the manner that’s most convenient for me.

It’s no surprise that online shopping has taken over the retail marketplace. Malls and department stores around the world are closing at rapid rates due to an overwhelming number of consumers choosing to shop online versus in store. How can retailers expect customers to want to walk through their doors when they could just as easily shop at the click of a button? Insert Nordstrom Local. 

Nordstrom Local is the convenient service hub for online order pickup and returns, express alterations and style guidance, all with the same passion for customer service that Nordstrom is known globally for at the fraction of the store size. About the same square footage as your local Starbucks, Nordstrom Local provides shoppers an opportunity to interact with the brand in a convenient, efficient way that entirely exists to serve their immediate needs. Nordstrom says its customers in Nordstrom Local stores are returning goods faster and spending more money, giving the retailer a better chance of reselling returned products and continuing to leave their assisting reputation on customers in a fresh, new way. 

Serve Me: don’t just sell me a product, but provide me with a solution, making my life easier and ensuring I get the most out of my purchase. 

Buying a tool for a hobby or activity is more than just purchasing the item… you have to know how to use it. Think of all of the things you can order for your hobby and then think of how useless they would be without proper knowledge: a set of kettlebells (half of which you can’t even lift yet) for your desire to work out more, an embroidery loop for a first-time needlepointer up to their ears in floss, or a specialty tool set to fix that pesky leak under the sink. What good are these items if consumers don’t know how to maximize their usage? 

Equal Parts, a cookware company, offers their customers 8 weeks worth of free access to a cooking coach with the purchase of any Equal Parts cookware kit to help them develop skills and confidence in the kitchen. By giving them an opportunity to learn and grow around their purchase, consumers are able to maximize their dollars spent, often connecting the positive learning experience with the retail sale. 

Value Me: provide meaningful value that rewards my loyalty and shows me you’re there for the long-haul. 

Shopping somewhere where the associate knows and remembers you creates hundreds of opportunities for your connection to the store to both grow and strengthen. Think of the last time you got your favorite waiter at that one great restaurant you always go to – isn’t it nice how they always remember what you and your spouse want to drink and serve it to you before you even have a chance to ask?

Fashion retailer Ruti has introduced a series of cameras in their stores that scan and take photos of customer’s faces. The photos are then stored in the brand’s CRM along with information on their shopping habits and style purchases. While this may come off as an invasion of personal space and privacy to some, Rumi is treating their customers with the respect and assistance of a lifelong friend, analyzing every interaction to ensure that each one that follows will provide an even better shopping experience than the one before. 

Know Me: empower me with digital tools that allow me to control my shopping experience while continually working to make my experience even better. 

Fashion brands especially seem to find themselves racing neck and neck to produce the trendiest new items for the season – which can sometimes amount to even just a single week for a product’s 15 minutes of fame. When companies overproduce and don’t prioritize learning from data to predict new trends, they’re left with financial loss and an unimaginable amount of stock (we’re looking at you, fidget spinners.) 

Fashion brand Choosy uses data to uncover trends on social media then quickly designs its own products on the most popular styles and produces them on demand. While some consumers see this as a classic case of fast fashion, brands like Choosy and Forever 21 know their consumers are just looking for an inexpensive outfit that will look great in an Instagram picture. It’s not that Choosy doesn’t put the time and effort into r&d for new products, it’s that they simply know their customer, their needs, and how fast their taste can change – and how to change with them. 

Personal Utility in Grocery:

Now that we know how to maximize personal utility, how can we translate what we’ve learned to represent the grocery industry? Let’s take a closer look at the numbers behind the PSFK report:

  • 85% of surveyed individuals find a personalized experience where retailers automatically suggest, order, or recommend products that best suit personal preference appealing 
  • More than 90% of consumers are increasingly open to whatever products can get to their door the fastest
  • 64% of consumers say that it is very important or somewhat important than the brand provide educational or informational content that helps them get the most out of their purchase
  • 80% of consumers are more likely to do business with a company that offers them personalized experiences 
  • 79% of customers are willing to share relevant information about themselves in exchange for contextualized interactions in which they are immediately known and understood

Grocery retailers looking to maximize their apps and digital reward system can maximize on the notion of 85% of individuals wanting retailers to automatically suggest, order, or recommend products that best suit their personal preferences. Consider how you can use your rewards app to suggest new products to customers that may fit the lifestyle the data shows that they’re living. Whether you have the opportunity to suggest healthier products, alternatives to products they only bought once or didn’t like, or similar products to ones they’ve purchased in the past, retailers are strengthening their relationship with the consumer by being a trusted adversary in the grocery buying process. 

Grocers looking to invest more in their store-to-door delivery programs should take note of the 90% of shoppers who are willing to shop at the retailer that can get their groceries to them the fastest. Investing more time and resources into staffing applicable individuals and ensuring they have the tools to accurately shop and deliver the items on the consumer’s grocery list in a competitively timely manner will surely lead to an increase in brand loyalty. 

Grocers looking to foster a closer relationship with their consumers could invest in helpful in-store signage, newsletters to be put in grocery bags, or informational pamphlets that provide helpful information on recipes, community incentives, and external resources in order to provide a more well-rounded experience for the consumer. With 64% of shoppers wanting to learn more about what they’re already buying, there’s no better time than now to go the extra mile. 

For grocers looking to enchant the 80% of shoppers wanting a more personalized experience, grocers should hyper-personalize their in-store micro-experiences. If the data shows that consumers are worried about the grocery store being a stressful environment, consider incorporating a shop-and-sip program, live music, or childcare services to re-define the atmosphere of the store. 

Even though data privacy is a growing tech concern, never be too afraid to try to get to know your customers better. With 79% of shoppers willing to share valuable personal information on their shopping habits in order to have a more fulfilling experience, grocers should jump at the chance to invest in the newest data to track their customers habits and emotions. 

Maximizing personal utility doesn’t have to be a chore. By inspiring, meeting, serving, knowing, and valuing your consumers, retailers of all industries can be equipped to strengthen their consumer interactions across all categories.

More information on the PSFK Future of Retail 2020 report can be found here. 

How Starbucks CEO Kevin Johnson is Prioritizing Human Interaction

How Starbucks CEO Kevin Johnson is Prioritizing Human Interaction 764 458 Natalie Tatum

Kevin Johnson is the president and chief executive officer for Starbucks, passionately and proudly carrying on the Starbucks legacy of human connection in all of his initiatives as he leads over 330,000 Starbucks partners in more than 28,000 stores around the world. 

Since becoming the CEO in April of 2017, heightening human interaction beyond customer service has been at the forefront of Johnson’s projects, believing that shared experiences create common understandings, beliefs and languages. Because of this, those working at Starbucks are referred to as partners, not employees, citing that the term fosters a sense of equality and shared vision. 

At his featured Keynote at NRF 2020, Johnson said that “Starbucks has worked to create a special customer experience grounded in human connection” that “ comes together in a comfortable third place, a community different than home or work.” 

When asked about what inspires him to bring back human interaction in the height of commercial technology, Johnson mentioned his disdain of how this age of unparalleled digital connection has brought with it an age of unprecedented human disconnection.  

“While technology has done many wonderful things, it’s also changed behaviors in a way where people don’t interact with one another nearly as much, which is unhealthy and I think is contributing to a global epidemic of human loneliness. I realize that serving 100 million customers a week at Starbucks means we have at least that many opportunities to enhance human connections and perhaps create that sense of community and a place where people feel more connected face-to-face with other people.” 

This sense of community can be seen not only in traditional Starbucks stores, but in their specialty-focused stores for military families and deaf communities as well. The Starbucks Signing Store and Military Families Stores aim to provide a hyper-welcoming environment for all customers, with particular recognition and support of the local military and deaf communities in the cities the stores are found in. The Starbucks Signing Store is located in Washington D.C., while the Military Family Stores can be found in Austin and El Paso, Texas, Clarksville, Tennessee, Newport, Rhode Island, and Bedford, Massachusetts, all located in military camp and base communities. 

Johnson isn’t only encouraging the creation of micro-communities in stores to heighten customer experience. Starbucks Deep Brew is a technology initiative working on a broad suite of tools to elevate almost every aspect of the business, eventually helping to automate many aspects of the store life. Primarily, it will act as an invisible, super-smart sidekick to baristas to elevate the Starbucks experience for the customer. It can help with tracking inventory, supply chain logistics and replenishment orders, allowing partners extra time to focus on fostering meaningful interactions with customers. With more time dedicated to perfecting customer interactions, Starbucks can create micro-communities in every neighborhood that feel personalized and prioritized. 

Behind every aspect of Johnson’s hopes for Starbucks to headline customer service is his tried and true rapid cycle plan of bringing ideas to implementation in 100 days. Off the bat, Johnson saw the need to perfect new ideas and initiatives for 31,000 stores. Instead of focusing on mass implementation, Johnson recommended working on advancements in levels, measuring success by what you learned at each individual step along the way and perfecting initiatives in one store, learning from the process, and taking that expertise to the next store. 

Johnson’s drive and passion for creating a community can be seen from a mile away. His excitement strengthens Starbucks’ legacy of connection from president to partner and continues to pave the way for the future of technology’s role in human interaction.

3 Key Takeaways from NRF 2020

3 Key Takeaways from NRF 2020 1200 800 Natalie Tatum

The National Retail Federation (NRF) Big Show is not an event to be missed. Retail industry leaders from around the world gather for three days in the retail capital of the world, New York City, to discuss upcoming trends, technologies, and troubles that the world of retail and its consumers are facing.

In 2019, NRF taught us about the importance of transparency in retail, the evolving workforce, and how personalization all come together to amplify customer experience. In 2020, NRF shifted more towards personalization to stress how important it really is to not only know your customer, but to be their eyes and ears in the global marketplace. Here are the top three trends we saw from NRF 2020 that are shaping the future of retail. 

Bringing Back the Human Element of Retail 

In a world where automation and artificial intelligence are at the forefront of most retail operations, NRF flipped the script by highlighting the importance of customer interaction and fostering human connections in the workplace in multiple sessions during the three day event. 

Newly appointed Walmart CEO John Furner described how his time with Sam’s Club made him realize that the best way to connect with the customer isn’t through relatable ads on social media, but by re-introducing sales associates as brand ambassadors that can aid and guide you through your shopping process. 

“I visited our Club in Lubbock, Texas, and met the club manager, Jerry, who had worked at the company for 18 years. I asked him a couple questions about his business and he immediately stepped to the back. He had 15 team leaders in front of him and said, ‘They’re going to answer all your questions.’ As I started learning from them, they were not only answering my questions, they told me everything you’d ever want to know about the business, and what it takes to run a business in Lubbock, Texas. At the end of that, it was so clear that if we could replicate that in 100 buildings, we would have the basis of a winning strategy.”

Furner also cited that bringing store leadership out to the floor and away from the front office had a substantial impact on operations and problem solving in the retail space. Where before leaders wouldn’t hear of an issue until it had already been attempted to be fixed, they were now hyper-aware of every moving element in the store, allowing them the opportunity to assess problems, evaluate opportunities and implement new techniques in a more timely manner.

Furner also mentioned that improving the work experience wasn’t only associated with increasing pay and salary. While Walmart did increase pay and salary, Furner cites that one element of major success for Walmart employees comes from rolling out programs that make it easy to change schedules to accommodate work-life balance as well as initiatives to enhance in-store productivity. 

In a separate session “Humans are Back: Why Companies are Putting a Premium on the Human Element of Retail,” PSFK CEO Piers Fawkes divided the delivery options with personal utility into five categories: inspire me, meet me, serve me, value me, and know me. Each category highlights a different element of nurturing a relationship from retailer to customer, citing personalized recommendations, convenience, and solution-based sales behind each reason. 

In a recent survey by PSFK, data showed that 70% of consumers expect a retailer to offer them the same level of personal service whether they are shopping in a physical store or on their mobile device. With initiatives across the retail industry focusing on bringing human experience and expertise back to customer service, the importance of connecting with the customers in a traditional way was at the forefront of NRF 2020. 

Micro-Experiences are a Must

The micro-experience isn’t a new idea or trend in retail. Retailers have been focusing on the small format, in-store activations that engage consumers in a way that can’t be replicated online for the greater portion of the last 10 years.  However, traditional micro-experiences are being left in the dust by industry leaders Rent the Runway, L’Occitane, Nike, Foot Locker, and CAMP. 

Rent the Runway, an online service that provides designer dress and accessory rentals, recently partnered with W Hotels to find a solution for everyone’s least favorite part of traveling: packing and unpacking. The partnership allows customers to reserve and rent their clothes online and have them delivered, hung, and ready to wear in their hotel room when they arrive. 

L’Occitane maximized on a sensorial and immersive micro experience in their New York City Flagship store by taking customers on a virtual reality journey to Provence, their founding city. Guests are also encouraged to touch and feel products under a “rain shower” sink and be transported to the south of France while sitting under the store’s Mediterranean-inspired olive tree. 

Nike’s “Vending Machine” challenges retailers to rethink loyalty programs beyond points and discounts. After finding that 40% of customers use the Nike app, Nike introduced exclusive member rewards for customers that use the Nike Training Club activity app that provides members with personalized access to limited edition product collections that correspond to the training activities they frequent the most. Members only sales, promotions, in-store events & services such as ‘Clean Kicks On Us’ and “Nike Master Trainer Fitness Class” ensure loyal customers receive curated experiences and exclusive benefits.

Foot Locker opened “regional power stores” in Detroit and Philadelphia after first introducing them in Liverpool and London. The stores feature exclusive products and touches tailored to local taste, aiming to deliver on “experience” and hoping to rebrand into a “hub of local sneaker culture, art, music and sports” by hosting traffic-driving community events like pop-up nail salons and Xbox gaming sessions.

CAMP describes themselves as a family experience store designed to inspire and engage families by combining merchandise, play and media. Inside camp are rotating themed experiences, where “every surface is a seamless blend of play and product.” With themes like Base Camp, Toy Lab Camp, Travel Camp, and Cooking Camp, both merchandise and experience are constantly changing to ensure customer loyalty and interest through each quarter. 

Micro-experiences of the past now turn a blind eye – but by looking at these industry leaders, it’s easy to see how micro-experiences have rebranded from a simple in-store event to a fully integrated shopping experience. After all, according to a study conducted by Expedia and the Center for Generational Kinetics, 74% of millennial shoppers said that they would rather pay for experiences rather than things. 

Emotion-Fueled Purchases

Now more than ever, consumers are shopping with alternative causes in mind. In the session The Rise of the Emotional Economy: Honesty, Empathy, and Integrity Resonate with Consumers: Leslie Ghize of TOBE and Amy Vener from Pinterest, Ghize stressed that retail is switching from a commercial to an emotional economy. 

When evaluating brands, consumers primarily use emotions, their personal feelings and opinions rather than brand information or facts to craft an opinion. Advertising research revealed that the consumer’s emotional response to an ad has a far greater influence on their reported intent to buy a product than does an ad’s content – by a factor of 3-to-1 for television commercials and 2-to-1 for print ads. 

Additional research conducted by the Advertising Research Foundation concluded that “likeability” is the measure most predictive of whether an advertisement will increase brand sales. Studies show that positive emotions toward a brand have a far greater influence on consumer loyalty than trust and other judgments, which are based on a brand’s attributes. 

Ghize went on to say that “brands need to look more actively and purposefully at the culture buzzing around them – in entertainment, in fashion, in news, on social media – and use that awareness to inform how they should best position and integrate themselves into the world.”

Following the publishing from a SAP 2018 survey on socially conscious companies, Alex Atzberger, president, SAP Customer Experience, SAP said “we live in an experience economy in which consumers care not just about products but also about a company’s purpose, value and global impact. For retailers this can be decisive while competing during the holiday season, when shoppers are spending more than at any other time of the year. Our survey findings indicate that when a company closely connects its purpose to the brand, chances are customers will relate to it on a more personal, human level – which supports customer loyalty and completes the customer experience.”

Advancements in customer service, micro-experiences and cause-conscious shopping are shaping the world of retail at a rapid rate. Lessons we learned from NRF 2020 not only pertain to major retailers like the Walmarts and Nike’s of the world, but the grocery industry as well. Through 2020, retailers far and wide should prioritize the value of a heightened person-to-person interaction, the power that a micro-experience has on a shopper, and the strength of harnessing consumer emotion in a progressive way. With these tools under your belt, any industry can shape the future of retail in their own unique way. 

Large Format vs. Small Format – What is Winning in Grocery?

Large Format vs. Small Format – What is Winning in Grocery? 720 480 Andrew Hoeft

If you’ve been keeping up with grocery news (here are our favorite places to do so), you’ve likely seen a trend emerging in stories about the format of grocery stores. We’re experiencing a large scale shift in retail as a whole, and it’s only natural that the grocery industry would follow suit.

Traditional retail size and formats aren’t cutting it anymore. We’re seeing the demise of storied department stores like Boston Store and Shopko as retail goes digital and consumers rely on brick-and-mortar retail more for experience than for hefty levels of inventory. It’s simply easier to outfit an online shop with every item that your company carries and shipping directly to customers as-needed  vs. shipping out to stores and hoping items will sell out on your shelves.

You can see that trend emerging in grocery stores as well. Small format stores are becoming a more common occurrence, and we’re wondering as much as anyone – are these curated spaces the grocery stores of the future?

Small format grocery store benefits

The upsides of a smaller format grocery store make sense in this retail environment. They’re great in city neighborhoods where the population is dense and the options for food are scarce. Food deserts can be remedied with small format stores in these locations, and keep residents from having to travel for miles for their weekly shop. 

In addition, shopper behavior has changed drastically over the last 10 or so years. Online click and collect and grocery delivery are becoming popular, and when shoppers are heading to a brick-and-mortar store, they’re coming in more frequently for less items. They’re either stocking up for the week, or purchasing only enough ingredients to make dinner that night.

We’d be remiss to neglect mentioning how small format grocery stores can help with grocery’s narrow margins too. All of the overhead that comes from managing a superstore can be minimized when opting for smaller space.

Who is experimenting with small format grocery stores?

  • Kroger – the grocery giant is dipping its toes into the water with their Kroger Express formats, conveniently located inside a Walgreens location. Their first test is located in northern Kentucky, and offers more than 2,000 items.
  • Whole Foods – Whole Foods Market Daily Shop is a grab-and-go version of a small format grocery store that the health-conscious retailer is testing in New York.
  • Sendik’s – The Milwaukee-based grocer has been experimenting with pairing their small format store with a gas station to offer more convenience to the customer. So far, the test has been highly successful.
  • Giant Foods – Ironically, Giant Foods is getting in on the small format game. They’ve opened a 9,500 square foot Giant Heirloom Market in Philadelphia.
  • Hy-Vee is scaling down with 10,000 square foot Hy-Vee Fast & Fresh locations.

Small format grocery store challenges

Though these stores are definitely bringing something to the table for grocery retail (and adapting to current shopper behavior), these experiments haven’t all been successful. In Austin, Texas, in.gredients, a package-free micro-grocery store closed because of rising rents, and Plenty Grocery & Deli, a Chicago-based store, closed in April 2019.

One Grocery Dive article said it best, “Offering a limited range of products has a quaint appeal, but operating costs in dense areas can be high and consumers looking for a full shop may still opt for a traditional supermarket.”

Smaller format stores are working as a separate offering for many large, well-known retailers, but they do face unique challenges in the shifting retail landscape. You’ll likely see more stories about small grocery store format, as more retailers jump into the ring and try out their chances.

2020 Grocery Bonus Trend: Plant-Based Products

2020 Grocery Bonus Trend: Plant-Based Products 720 480 Andrew Hoeft

We’re a few weeks into 2020, and there are already clear indicators that many of the trends we predicted are coming to life. We’re spending the week at the National Retail Federation (NRF) Big Show, and these concepts are being mentioned again and again by top retail insiders in their industry-leading sessions. We’ll be bringing all of the latest information to you soon, but we couldn’t resist filling you in on one 2020 grocery trend that’s making waves already this year: plant-based products.

It’s no secret that plant-based products have been around for awhile – vegetarianism and even veganism have become expected dietary restrictions throughout the United States. Those who practice these diets are no longer in the minority, and grocery stores have needed to pay attention to their needs and desires while stocking their shelves in order to maintain their consumer base.

However, plant-based products have exploded over the past five or so years, and they’re poised to have an even bigger impact on the grocery space in 2020 and beyond.

 

What you need to know about plant-based products

Grocers have needed to cater to vegetarian and vegan customers in the past to avoid losing their business, but today plant-based products are more than just a “nice to have” in the grocery world. They’re a necessity for any grocer who wants to position themselves as forward thinking. They’re a growing category.

Plant-based products represent an entirely new opportunity for revenue in an industry with notoriously thin margins.

At this stage in the game, plant-based products have entered just about every category within a grocery store, from the dairy aisle and the meat counter to the seafood section. It’s no longer abnormal for a customer to see a package of plant-based burgers nestled in amongst typical beef patties.

In fact, plant-based meat alternatives may be the most popular form of plant-based products. Companies like Beyond Burger and Impossible Burger have entered the mainstream conversation due to partnerships with well known brands like Burger King and Qdoba. These fast food mainstays have tied their success to the plant-based movement, and are advertising these options heavily to consumers. They aren’t just targeting the vegetarian and vegan crowd either – they’re telling die-hard carnivores that their plant-based options taste just as good as their meat-focused menu items – and that they could be a healthier alternative for those who are looking to cut down on calories and cholesterol.

Tyson too is investing in plant-based protein. The poultry leader launched vegetarian nuggets in June.

These companies have good reason to believe that plant-based is the category of the future. “U.S. retail sales of plant-based foods grew 11.3% in the past year,” according to the Good Food Institute and the Plant Based Foods Association. Sales were up 31.3% overall between 2017 and 2019, to a grand total of nearly $4.5 billion in revenue.

Here’s one more stat to consider: $1.9 billion was spent on plant-based milks in the United States over the past year, which made milk the “top-selling plant-based category”. These milks include varieties like almond, soy, and oat milks, and may have been spurred by the popularity of using these plant-based, wellness-focused alternatives in beverages like coffee and tea. Grocers have started merchandising these items in the traditional dairy case, which gives shoppers who may not normally come into contact with plant-based products a chance to, in a fit of curiosity, add them to their cart.

The numbers are convincing, and experts predict that the trend will only continue to grow in the coming decade. As a grocer, you can learn a few lessons about how to effectively integrate plant-based products into your inventory from your peers.

 

What is the best way to capitalize on the plant-based products trend in grocery?

The top technique for making plant-based products work in your store is to make them feel like they are an intentional addition to your offerings, not just an extra section in your store that is only shopped by those who have dietary restrictions or moral reasons for not eating meat or dairy products. To fully integrate these products, you need to place them near their meat and dairy counterparts

Grocery stores across the country are moving away from having a specific “organic” or “vegetarian” section. Instead, they are putting these alternative products directly in their cases, Beyond Burger next to ground chuck, and almond milk next to the 1% and chocolate cow milk.

The main impetus for this adjustment is that, instead of organizing a grocery store in a way that makes sense on the backend to a grocer (inventory categories placed next to each other in a very structured fashion), grocers are beginning to layout their stores to suit the customer. They are considering the way consumers shop, and placing items that go together in the customer’s mind next to each other in the store. If a customer has “milk” on their shopping lists for example, it doesn’t matter if they’re looking for soy milk or dairy milk – they should be able to go to the same spot and pick it up, not head to a separate vegetarian section for their shopping. Reducing the friction around these plant-based products makes them a more natural purchase for any shopper, not just those who adhere to a vegetarian or vegan diet.

Call this idea a trend within a trend: negating marketing material and labels that categorize a plant-based product as “vegan” or “vegetarian” normalizes it for the mainstream shopper. Instead of feeling like they can’t purchase a product because they don’t fall into one of those two categories, they may be able to tap into their curiosity or health-focused mindset and choose a new plant-based alternative. 

There are a number of grocery stores who are successfully implementing the tips above, but there are a few who are going above and beyond to actually create plant-based products for their in-store brands. Trader Joe’s and Whole Foods top the list, which may not be entirely surprising to based on their shopper demographics. Wegman’s is also leading the way in private label plant-based products, showing that the traditional grocery store can also get in on this 2020 trend.

 

Pros and cons of plant-based products in your store

Plant-based is a major 2020 trend, but it’s not magic – there may still be some roadblocks that can prevent these products from becoming a success in your store.

First and foremost, though big name brands are doing a lot of plant-based advertising for you there is still some hesitation with products such as plant-based cheese – and even those meat alternatives we mentioned earlier. Carrying plant-based products requires some education of your current shopper, informing them of what options are available and perhaps creating a few testing stations in your stores to introduce them to the product.

You’ll also be tasked with finding room in your limited inventory space for these new plant-based products. As we all know, there is a definite level of negotiation between grocers and brands when it comes to where products are merchandised, and adding in an entirely new category could cause some friction with brands who haven’t gone down this route yet.

Although there are challenges at stake, making an effort to carry and promote plant-based products in your store has some major benefits as well. The financial upsides of adding in a popular new category are just one reason why you should consider jumping on board with this trend.

When you carry meat and dairy alternatives in your store, you’re positioning yourself in a positive light. You are telling your shoppers that you are wellness-focused, that you understand the health benefits that plant-based products might bring. You also show that you are invested in your shoppers, no matter their dietary restrictions or eating habits. You want to offer them the food that they enjoy, that they feel good about eating, and you want to expose others to that same opportunity. Finally, you care about the environment. Plant-based products cut down on the carbon emissions caused by traditional dairy and meat processing, and shoppers are savvy about that fact. By promoting other options, you’re giving people a chance to exercise their moral compass, and feel good about what they’re purchasing.

This year, plant-based products are ruling the grocery aisles and the halls of NRF’s Big Show. We can’t get away from this topic, and the shopping data tells a clear story of why. To point your stores in the right direction, take a few tips from your peers, weigh your options, and then dive in feet first with a few plant-based offerings. Give your shoppers a chance to show you whether they are interested or not before writing off this trend entirely. You might just be surprised by which category has the largest impact on your P&L come 2021.

 

2020 Grocery Trends: Robotics

2020 Grocery Trends: Robotics 720 561 Andrew Hoeft

The “future of retail” holds a lot of promise – and a lot of promises. During annual conferences and think tanks, the possibilities of a grocery industry dictated by artificial intelligence, robotics, and detailed consumer insights are regularly discussed with fervor. Entire presentations are spent talking through what it could be like to shop for groceries in the future.

There’s just one problem. The future is now.

Grocers aren’t waiting for retail-focused technology to emerge before testing new innovations in their stores, and, frankly, they can’t afford to. Retail giants are surging ahead, and making technology a non-negotiable for grocers everywhere. 

Robotics are just one way in which grocers are showcasing their willingness to adapt to the current retail climate.

 

Who is using robots in their grocery stores?

The most notable use of robotics in the grocery industry thus far is Marty the robot. Marty is an in-store robot that wanders the aisles of Ahold Delhaize’s Stop & Shop and Giant Food Stores. He’s a tall, rectangular figure on wheels with large googly eyes and a small grin – meant to give off a human-like appearance and put surprised shoppers at ease. Marty’s main skill is to alert store managers to hazards like spills or items dropped on the floor. The grocer says that Marty allows them to cut down on employee hours and focus in on the smaller things that can take up so much of a store associate’s day like fallen price tags.

An article by New Food Economy said, “Ahold Delhaize has explicitly told shareholders that the company is investing in automation and artificial intelligence to supplement or even replace human labor.”

 

Walmart has also gotten into the robotics game, though at a far less intrusive level. The retail giant has introduced automatic floor scrubbing robots into some of their brick and mortar locations across the United States.

 

Pros and cons of robotics in grocery stores

Robotics is one of the more controversial 2020 trends. It’s not all benefits and value adds with this concept. 

Adding robots into your store can position you as “worker-averse”, and quotes like the one from above about reducing employee hours don’t help. A recent Washington Post article says, “As Walmart turns to robots, it’s the human workers who feel like machines.” 

Technology can be a great thing in retail, but it also has the potential to remove that undeniable human factor that is such a keystone of the traditional grocery experience. Today’s robots are industrial, creepy, and cold, and, even if they are given large eyes and a smile, they are not easily integrated into a grocery store that is determined to provide that neighborly feel.

It seems as though the large investment that it takes to integrate robotics in a grocery store have not paid off just yet. There aren’t many successful use cases of using these technological innovations – so far, they haven’t been able to do much for grocers other than alert them to things that store associates will still need to take care of. One Ahold Delhaize worker has been quoted as calling Marty, “a glorified Roomba.

There are some potential benefits to robotics in the grocery industry when the technology catches up. Adding robots into your store that can effectively take care of smaller concerns can allow your employees to refocus on meaningful tasks like customer service and that oh-so-important person-to-person interaction. Saying “yes” to robots can also position your business as tech-forward and innovative, and add an element of modernity for your customers.

All this is to say that robotics definitely have a place in the grocery industry, and it’s likely that we’ll see more iterations on this concept in 2020. However, it may be a few more years before they proliferate throughout the country, and become a normal sight in the contemporary grocery store.

 

2020 Grocery Trends: Grocery Delivery

2020 Grocery Trends: Grocery Delivery 720 480 Andrew Hoeft

Consumers are used to a certain level of convenience. Online shopping and quick delivery rules the retail industry today, and consumers don’t even have to leave their beds in order to complete their weekly errands. Just a few taps of a button, and their goods will arrive on their doorstep. 

Grocery delivery was the logical next step for this retail environment. Grocery shopping is one errand that many people need to complete weekly, stocking up on necessities like milk, bread, coffee, eggs, or butter. It’s not a rare task, and, to be frank, it’s not a task that many people enjoy doing today.

If a modern grocery store doesn’t offer an elevated experience, it can be a drag for shoppers to come in each and every week and purchase what they need. It can feel monotonous, inconvenient, and even frustrating to shop in a grocery store that hasn’t stepped into the new world of experience-focused retail.

So, what do you give a shopper who doesn’t want to shop in your store? The option to have their groceries delivered right to their home. Et voila, grocery delivery.

 

The current state of grocery delivery

Grocery delivery is a service wherein a shopper orders their items online, and they are delivered right to their home. It eliminates the need to head to the store for a weekly shop, or an impulse purchase.

The concept itself was slow to catch on in the United States compared to other countries around the world. In South Korea, 20% of consumers buy groceries online, and in both the United Kingdom and Japan, 7.5% of consumers do the same.

While grocery delivery has become quite common around the world, even becoming a preferred method for many shoppers, American consumers seem to have waited to judge its success before jumping in. Now, they’ve capitulated with full force.

Coresight recently conducted a study that showed 36.8% of internet-using adults polled bought groceries online in the previous 12 months, up from 23.1% in their 2018 study. That equates to approximately 93 million online grocery purchases using U.S. Census data. 

Of interest to you: the majority of these purchases came from retailers like Walmart and Target, followed by Kroger.

If you take into account the average American consumer’s buying power, it’s clear that grocery delivery’s popularity could become a major income stream for grocers across the country.

And they’ll need it. Amazon has dipped its toe into the water of the grocery industry over the past few years, and grocers need to adapt and innovate in order to stay competitive with technology-savvy shoppers.

 

Who is doing grocery delivery well?

As mentioned above there are a few retailers who are dominating the grocery delivery category, and they all happen to be major grocery industry leaders. Though many independent grocers offer delivery, the majority of purchases take place through Walmart, Target, and Kroger.

According to Supermarket News, “Walmart and Kroger have more than doubled their online grocery shopper numbers over the past 12 months, adding about 20 million and 6 million online customers, respectively.”

Those numbers are staggering in light of grocery delivery’s relatively recent popularity in the United States. Now that it’s caught on with the average shopper, it won’t be going away anytime soon, and consumers will begin to expect a delivery option from even the most independent grocer.

If you’re reading this as a small, independent grocer, you may have just let out a groan. So many grocery industry trends feel like they leave out “the little guy”, the hometown grocer who actually provides that individualized experience that customers say they crave. You feel like you’re doing everything right, but that innovations are leaving you and your business in the dust.

Not grocery delivery.

Because of its near ubiquitous adoption across the country, startups have popped up to assist grocers with executing on a grocery delivery strategy. Third party delivery systems like Shipt and Instacart exist, and they’re here to help your business implement grocery delivery without a large operation or logistical nightmare. An official partnership will still be an investment, but one well worth taking on if you want to remain relevant in today’s retail atmosphere.

 

Pros and cons of grocery delivery

Every trend has its upsides and its downsides, and it’s up to you, as a grocer, to decide what makes the most sense for your business. But, you don’t have to do it alone. We’re here to help you break it down.

Let’s start with the benefits, or the “pros” of grocery delivery, shall we?

First and foremost, the convenience factor. Customers are no longer patient. They no longer are forced to take part in activities that they don’t enjoy, that don’t add value to their lives, that don’t bring them joy. Grocery shopping can easily fall into the category of “things I don’t want to do”, therefore giving your store a negative association simply for existing. 

When customers aren’t given the option to forgo traditional means of retail, they can become frustrated, and, instead of relishing in the experience you’ve created in your store, instead of finding the joy in the person-to-person interactions you encourage with your store associates, they’ll find themselves resenting the fact that they have to leave their homes to shop each and every week. When they’re strapped for time, or strapped for energy, they want to be able to turn to a convenient option. Grocery delivery provides that to them.

More than convenience, grocery delivery is also a trending concept in the United States market. It’s gaining momentum quickly, and we would be remiss to say that it could be important for your business to jump on the trend right now while it’s hot. If you want your grocery stores to be considered thought leaders, innovators, or customer service-focused, you’ll want to look into the bevy of ways that you can offer a grocery delivery service. Even if you work with a third party delivery system, you’ll find that your customers will view you in a whole new light.

One more bonus to grocery delivery: it’s all done digitally, which allows you to gather new insights on your shoppers. Users must typically opt in to the service, and provide contact information like an email address or a phone number. This gives you a new way to contact them with promotions and information that could be relevant to them. While your usual access to a customer may be through in-person interaction and traditional advertising, implementing a grocery delivery service with a digital platform could allow you to push deals directly to your customers through their device or through the contact information that they provide. You’ll also be able to gain insights from their purchases through your delivery service to make informed inventory and advertising decisions.

Now for the negative side of grocery delivery. Though this concept is fast-growing  in America, it does have its downsides, and it’s imperative that you evaluate your individual business situation before making any large scale operational decisions.

The first piece that we have to point out about grocery delivery is that it’s not easily accessible for every grocer. Large retailers like Walmart, Target, and Kroger have success with their grocery delivery services because they have the resources (financial, operational, and personnel) to handle the complicated logistics involved with grocery delivery. 

As an independent grocer, you’ll likely have to utilize a third party vendor relationship in order to implement grocery delivery. That doesn’t have to be a bad thing for your business, as these vendors already have thorough experience with grocery delivery. However, it means that you don’t have direct control over what happens to your product as it’s being delivered from point A to point B. You won’t have direct control over the experience your customers are being provided. When you don’t have an in-house service, you simply cannot control the many variables that come into play with grocery delivery, and that could mean hardship for your business.

Finally, let’s talk financials. Grocery delivery may be cost effective for your customer, but it’s a major investment for you if you try to build your own internal operational structure. Hiring the personnel needed to have an effective grocery delivery service will cost you cash, and implementing the processes and procedures needed to make sure your customer has an elevated experience will cost time and money. The financial stability (and cash on hand) needed to run a DIY grocery delivery service for your grocery store is significant, and it’s something that definitely needs to be considered.

Grocery delivery is one of the hottest trends in this industry, and perhaps the one that is most achievable, even for independent grocers. Though it’s been around for a few years now in the United States, now is the time to hop on the trend because it has been proven to be a success with so many retailers. Consider your business situation and see if there is room in your strategic plan and your budget for a g