Tag Archives: food shopping experience

Can Digital Resources Solve Grocery’s Inventory v. Profitability Dilemma?

“The biggest challenges that grocery retailers face is excess inventory and profitability,” says Randy Evins, Senior Principal for Food, Drug & Convenience at SAP.

In a recent SupermarketNews article,  Evins explains that grocers face the dilemma of keeping their margins low by spending less while still delivering quality products. More labor requires higher costs, but without the additional attention to fresh foods, products will not be up to standards.

The solution: Grocery retailers should leverage digital resources and process improvement to more easily monitor, plan and execute their efforts.

“It’s critical that grocery free themselves from the constraints of doing everything manually.” Elvin says.

“Automation of simple tasks can help ensure manpower is used in more critical roles rather than routine monitoring and conditions management.”

The article goes on to present ways in which digital information can help supermarket management better-understand what products are most popular and what are consistently undersold, as well as which processes are the best candidates for streamlining. They would then be able to better manage some of the more challenging yet vital areas of the business, such as the fresh foods and perishable sections, which typically comprise up to 50 percent of sales and more than 60 percent of profits.

In addition to leveraging technology to improve operational efficiency, Elvins also stresses the importance of using data to better-understand customer preferences, and to drive the customer experience (CX).

“Stores must differentiate from online by taking advantage of consumer senses, drawing consumers into the store, and using experiences to convert the sale,” he writes.

In-store events like wine tastings, and providing local product representatives and vendors throughout the store to offer expert opinions, are often popular offerings that aren’t possible online, thus creating greater brand-and-store loyalty as well as a competitive edge over online retailers.

In-store v. On-line Shopping?

33% of all grocery shoppers will shop online this year, according to a recent article posted on retailcustomerexperience.com, which shared data from the 2017 Grocery eCommerce Forecast from Unata and in partnership with Brick Meets Click.

The article notes that ‘egrocery’ is gaining greater consumer attention and 31 percent of shoppers are likely to order online, up from 19 percent last year.

The article also states that seventy-five-percent of shoppers will switch grocers if there is a better shopping experience to be had, and sixty-eight percent of shoppers who had shopped online the previous year are “somewhat” or “very” likely to switch to a grocer offering a better online shopping experience.

However, when looking at retail in total, a Modern Consumer survey shows that fifty-six percent of U.S. consumers prefer a brick and mortar shopping channel, and 93 percent of customer journeys involve multiple channels. The survey, which polled 1,000 U.S. shoppers, also revealed that over seventy-percent browse for products online before buying in a physical store, and only 10 percent of shoppers mainly shop online.

So while it seems that shoppers in general lean more toward the in-store buying experience, many more leverage on-line shopping in advance and an increasing number of grocery shoppers are trending toward the on-line experience, at least some of the time.

“Quick” Customer Experience Analysis

As you most likely know, “Omnichannel” refers to a type of retail that integrates the different methods of shopping available to consumers (i.e., online, in-store, phone…).

While some say the concept is just a fancier way of describing cross-channel sales, others profess that “Omnichannel” goes further to encompass the continuity of the shopping or customer experience (CX).

To further illustrate this perspective, Todd Leach
VP, Client Insights at Service Management Group (SMG), an organization that focuses on customer and employee experience, writes that Omnichannel is changing consumer expectations and, in one of his blog posts, suggests that “speed” is high on the expectation list.

“Above all else, speed means seamless,” Leach says. “…and the idea of seamless is the root of an Omnichannel experience. Customer information must be available across multiple touch points throughout the customer journey to help make interactions with your brand both efficient and effective. Remembering a customer’s most-purchased items makes checkout a breeze…  a push notification lets them open your app when they come near a store… one-click check-out saves customers from having to give the same information over and over again. These small details make a huge difference in a smooth and efficient customer experience—and that translates to a favorable brand perception and a boost in customer loyalty.”

It seems the online and in-store experiences are merging to better serve customers. The question is, will this ongoing evolution and the associated impact on the customer experience also drive customer loyalty?

 

Employee Engagement Might Be the Key Differentiator for Lidl

Based on statistics published by smallbusiness.chron.com,  employee turnover averages 100 percent in the grocery industry. Cashiers, order fillers and stock clerks have the highest turnover rates, and the cost of replacing just one supermarket cashier is at least $3,637.

But more troubling than the cost, this turnover has a negative impact on the customer experience.

This perspective is consistent with information shared recently on fooddive.com, which states, “Never mind store designs, or prices, or any of the other issues potential competitors have been concerned about: While those issues are all important, so are the ways employees are treated… retaining employees helps to build a cohesive team and a solid shopping experience.

The article goes on to cite the rapid growth of German grocery chain Lidl, whose accelerated U.S. expansion is making many take notice. The grocery chain’s first 20 stores will open this summer in Virginia, North Carolina and South Carolina.

But along the lines of engaging employees, the chain has a plan to attract and retain the best talent by offering one of the most generous benefits and compensation packages in the industry. “The program is designed to ensure that Lidl U.S. employees are recognized and rewarded for their talents, feel valued for their contributions and are motivated to continue to grow their careers with us,” the article said.

Store associates will receive starting salaries of $12 per hour, plus benefits, according to a Lidl press release.  Possibly more important than the robust pay rate is the robust benefits plan, which includes medical, dental and vision insurance with flexible spending accounts, a 401(k) and retirement plan with employer contribution, life insurance, disability insurance, an employee assistance program, paid time off, time off for volunteering, commuter benefits and company sponsored social and fitness events.

Clearly Lidl leadership has a strong appreciation for its workforce and values the concept of employee engagement. If the correlation between employee engagement and customer satisfaction proves true, which we believe it will, it will be interesting to see what happens over the course of 2017, during which time Lidl plans to open 100 U.S. stores.

Supermarkets of the Future – Happening Now!

Earlier this year we shared several posts about the “supermarkets of the future,” in which several predictions were made such as the emergence of more tasting stations, more interactive displays, less waiting at check-out, and food deliveries made by robots!

Since then, many of these predictions have become realities, although not necessarily all in one place – at least until now!

A “supermarket of the future” has been opened in Italy according to a recent SupermarketNews article, which incorporates many of the features listed above and more!

The largest Italian supermarket chain, Coop Italia, has opened the store near Milan.

“The 11,000-square-foot store is built around the ideals of innovation and transparency… and merging physical and digital by augmenting a traditional food market with interactive displays and smart shelves designed to make shopping more relevant and personalized,” the article said.

The fact that this “future” store is located in Europe supports a belief shared by numerous industry experts, that being that European supermarket trends are slightly ahead of those in the U.S.

Read the full article…

 

Engagement Day at Smart & Final!

A recent SupermarketNews article reported that corporate employees and top executives at Smart & Final,  a chain of warehouse-style food and supply stores based in Commerce, Californian, spent Wednesday in the field supporting one of the year’s bussiest shopping days.

, spent Wednesday ou support of stores anticipating their second biggest food shopping day of the year, around 200 employees at Smart & Final corporate offices reported to work at its stores Wednesday, including its top executives.

“Some people need to stay back and turn on the lights, maintain the help line and keep the systems running,” CEO Dave Hirz said, “but everyone else is pitching in at the stores. It’s a lot of fun.”

The event is part of a twice-yearly “Engagement Day” supporting the company’s core value of teamwork.

Based on the premise that engaged employees lead to engaged customers, this sounds like a great way of promoting both concepts!

Supermarket Dining!

supermarketdiningWe all know that the trend toward providing a more enjoyable and diverse shopping experience has been prevalent in the supermarket world. So it comes as no surprise that food stations that resemble quick-service or fast-casual restaurants are on the rise at supermarkets, emerging as a natural extension of the traditional deli counter.

But a  SupermarketNews article reports that ten years ago Whole Foods Market, Wegmans, and the Texas chain Central Market began to experiment with bringing a high-quality dining experience into their stores.

While the full-service restaurants have been slower to catch on, some chains, such as Wegmans and Price Chopper have found success with the concept, the article said.

A more recent Boston.com article shared numerous examples of how an increasing number of supermarkets in greater Boston are winning fans with affordable, high-quality restaurants.

As new supermarkets spring up, plans invariably include kitchens run by chefs, dining facilities, and more-in-store classes, the article said, citing as an example the Whole Foods in Dedham, Massachusetts, which has a glassed-in Wellness Club. Others feature live music and poetry slams, and the Shaw’s at Boston’s Prudential Center conducts nightly wine tastings!

Supermarkets may not have yet achieved the level of customer service associated with more traditional hospitality organizations, such as Ritz Carlton, but they certainly seem to be on the right track toward greater levels of customer service and engagement.

 

Is This the Future for Supermarkets?

robotsWhile several of our posts have discussed the emerging trend toward on-line grocery shopping options, a recent SupermarketNews article might be giving us an interesting glimpse into the future!

According to the article, self-driving robots capable of delivering groceries or restaurant meals are now being used in several European countries, and are also being tested in Washington, D.C.

Starship Technologies, an Estonian technology company established in 2014 by the co-founders of Skype, have developed the robots, which as you can see above resemble six-wheeled buggies.  Apparently these robots are capable of delivering up to 20 pounds of food, packages and goods to consumers within a short radius of their point of origin.

“They’re cost efficient, particularly for the kinds of small deliveries food retailers often find the most expensive,” said Henry Harris-Burland, Starship’s marketing and communications manager.

According to the article, the technology could cut costs to pennies per delivery, and allow for the delivery of even a single item to be profitable. Customers can place their orders on-line or through a mobile app, and a robot is dispatched to deliver in as soon as 15 minutes.

While this might all seem a bit futuristic, it strikes me as another step toward trying to cater to consumers’ demand for convenience, and toward providing a better, more customized shopping experience.

Thoughts?

Supermarket Shopping Experience Reinforced at “Supermarket Sense”

Continuing the “supermarket shopping experience” discussion from our previous post, a recustomerservicecent SupermarketNews article reported that it was aslso the theme at  Supermarket Sense, a food retail training conference that recently wrapped up just outside Atlanta.

“In today’s competitive environment, supermarkets can’t just sell food… they have to sell an experience,” the article said.

Sessions on saving the center store, reinventing the perimeter, tapping restaurant trends to drive supermarket sales and designing and merchandising delightful in-store spaces reflected grocers’ need to remain competitive amid unprecedented industry change.

Two data points offer a view of the challenges:

  • Online grocery sales in the U.S. grew 11% annually from 2011-2016, according to IBISWorld’s market research report. It’s now a $12 billion-a-year business.
  • Meanwhile, supermarket trip frequency decreased by 19 trips a year, on average, during that same period, according to global research firm Nielsen.

The solution, industry experts say, is engaging supermarket customers with an in-store experience that beats shopping online — or anywhere else!

Read the full article…

Supermarket Customer Experience & Expired Products

frozenA recent datecheckpro.com article referenced a challenge faced by supermarkets as they strive to attract and retain customers by providing a positive shopping experience and outstanding service.

The issue-at-hand is product expiration.

At the corporate level, author   says, “expired product costs generally remain hidden. As a result of date management execution challenges, expired products end up in the hands of customers or on the back of the shelf rather than on the P&L.”

Krawczyk goes on to suggest that the true cost of customer satisfaction, or dissatisfaction in this case remains unseen as well, and cites research from Date Check Pro, the industry’s leading expiration date management software, which indicates the average supermarket has over 1,500 expired items on the shelf within the center store alone!

The article also suggests that while product expiration issues are a preventable problem,  they plague many supermarkets because of:

  • People management – are the right people spot-checking and re-stocking?
  • Setting the wrong priorities – more urgent perational demands result sacrificing the important task of effective spot checking and restocking
  • Trends toward offering a wider selection of products

Given the competitive nature of the industry and the opportunity to positively impact the shopping experience, it would seem that supermarket chains would be best-served by proactively improving these processes on a continuous basis.