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Retail Industry Updates

Why Personalization at Grocery is Not an Option


The shopping environment has changed — but not the shopper. In that distant world of pre-COVID-19, roughly five months ago, retail grocery strategists and futurists were focused on things like omnichannel, brand transparency and customer experience. The “new normal” only changes the focus, not the lens. Adjust the lens and “personalization” comes into focus as a high-def image.  

For some time, personalization, omnichannel and targeting all have been intertwined and largely understood in terms of delivering deals, ads, content, and other relevant info to shoppers based on their online browsing and purchasing habits. You buy peanut butter; you get a coupon for another brand or for grape jelly. You like organics, you get incentives and information about organic foods. But today, that’s not enough.

“A range of emerging health topics barely on retailers’ radar a year ago are now grabbing the spotlight and crossing traditional well-being boundaries,” states a new report, “The Power of Health and Well-being in Food Retail 2020,” released last month by FMI–The Food Industry Association. “In addition to health, [consumers] want convenience, affordability, clear labeling, food safety, taste and transparency. As we look at our shopper trends research from just one year ago, we see consumers looking for more balance and less stress as they seek personalization in the grocery store.”

Consider how FMI’s report contrasts with this scenario from a McKinsey & Company article, “A transformation in store,” from May 3, 2019, that speaks about how current technology can revolutionize the in-store experience: Machine learning and big-data analytics techniques are ready to crunch the vast quantities of customer data that retailers already accumulate. Robots and automation systems are moving out of factories and into warehouses and distribution centers. The Internet of Things (IoT) allows products to be tracked across continents, or on shelves with millimeter precision. Now is a great time for retailers to embrace that challenge of bringing technology and data together in the offline world.”

The article then explores the experience of a hypothetical shopper in this new brick-and-mortar world: “… the store accesses the shopping list he’s been building at home by scanning items with his phone as he uses them up. As he walks the aisles, smart shelf displays illuminate to show the location of those items, while also highlighting tailored offers, complementary items and regular purchases that didn’t make it onto the list. … As he scans the package with his smartphone, an augmented-reality display reveals the origin of its contents, along with its nutrition information and even its carbon footprint.”

That was a year ago, and it’s a pretty good picture. But it’s obsolete in the context of the FMI study — and not just because COVID-19 has changed the in-store experience. The technology supporting personalization has dramatically advanced. Last year, the hypothetical shopper scanned items as they were used up at home and then scanned products in the store, one by one, to read about and assess ingredients and brand stories. Talk about time and stress.

Personalization today means that I define what’s important to me proactively, and the retailer and the brands give me all the product choices that fit my personal profile — with the availability of full, complete, transparent info about the product detail and brand values. In other words, I can proactively define my diet, medical and lifestyle needs to create my own personal “store,” based on products that meet my criteria. After all, part of my journey is product discovery. And I don’t want to scan my own out of stock or spend a load of time in-store scanning product labels. That work can be done for me in advance.

A glimpse of this can be seen on grocer Hy-Vee’s website, where you can search for recipes based on course type, diet, cooking method and/or type of dish. If I’m vegan, only recipes with vegan ingredients show up. I get all the ingredients, with the Hy-Vee store brands highlighted, without worrying about whether they fit or not. I can’t yet populate my cart with those items right off the recipe, nor does it offer me brand choices. But it’s more than Walmart offers and a glimpse of the future.

Soon retailers will provide shoppers with the ability to tune their product selection to exactly what fits their needs and wants — and get incentives, recipes, coupons, and even customer service and support, like flags regarding food-drug interactions — that can be changed every day if they want. And these services will include options that fit the other people for whom I shop, with a choice of delivery, pickup or shop in store with a list.

It’s the shopping experience that’s at the center of the picture — and I want my personal preferences to be detailed, accurate and easy to shop. Supply chain, omnichannel, accurate online product detail for every UPC, and responsive customer service must all be aligned to optimize my experience.

Look for a lot more news about how retailers and brands are leveraging technology to fulfill this vision.

Pierce Hollingsworth is an executive vice president of content for Knighthouse Media.


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