How grocery marketing has evolved in the digital age
Wednesday, May 03, 2017
Midwestern supermarket chain Hy-Vee recently announced their expansion plans, which include a shift beyond traditional grocery. What is interesting to note is the increased emphasis and budget for the IT department, an area that hadn't been high on retailer lists until recently.
Technology plays an important role for retailers and buyers, with studies proving that users will readily switch grocers for a better customer experience, both in-store and through e-commerce. Hy-Vee plans on creative store programs and apps to personalize the experience and drive their customers into the digital age.
Hy-Vee's innovative diversification strategies found a prominent place in industry panel discussions, too. At the NACS State of the Industry Summit earlier this month, the focus was on the varying methods applied by grocers and supermarkets to drive growth and survive. Along with Hy-Vee, notable among them were Target's smaller urban format stores, Walmart's experiments with the traditional c-store/fuel format and Winn Dixie's Hispanic-focused formats.
With consumers increasingly attracted to "fresh," it's not just fresh produce that is in demand but also fresh, ready-to-eat foods.
Ahold quickly adopted the trend with its "bfresh" concept that stresses both fresh produce and freshly prepared meals. Weis Markets, Kroger and Whole Foods are taking this a step further with casual bars, cafes and seating areas — even ice cream parlors.
Of course, with Amazon as the biggest threat to their survival, digital strategies like mobile ordering, coupons, discounts, click-and-collect, in-car/dashboard payment options along with speedy delivery options are being adopted quickly as well.
Despite the dire predictions of the death of supermarkets, people are not going change their buying habits and abandon the physical stores overnight. There is a shift, but it is not extreme. The grocery industry is now poised to take full advantage of the digital transformation and capture maximum traffic through both regular and e-commerce stores.
E-grocery may have been a term for online retailers to begin with, but traditional grocery store chains have been creating diverse digital features and online capabilities to drive engagement. Shoppers crave convenience and simplicity, and a winning marriage of traditional and online can deliver what they want.
While online means no checkout queues and less waste of time, options like Amazon Go — where sensors track and charge for purchases without one having to checkout at the store — are the convergent solutions we need. This way people can still enjoy the physical retail experience and enjoy the online convenience.
Immersive experiences, like the ones offered by REI and Restoration Hardware, may also be the way to go if one wants to retain and increase customer footfalls to the physical store. The options between "webrooming" and "showrooming" have become interchangeable, and the path to both must be seamless.
Artificial intelligence could also be a big differentiator, offering a physical, sensory experience to online shopping while predictive technology and app integration could improve in-store experience.
Many believe the technology integration and digital convergence in the retail experience will result in a retail resurgence. Time will tell.
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