This week people from around the globe gathered at the Aria in Las Vegas, Nevada for Groceryshop 2018 – the inaugural conference. Industry leaders and executives from across CPG, grocery, and retail assembled in the desert to talk about the disruption they are facing today and some of the innovative solutions that are being used to fight back against Amazon and deliver the best possible customer experiences in-store and online. Here are a few of the top takeaways that I had after walking the exhibition floor and attending many of the keynote sessions over the four-day conference.
Customer Experience is King
With grocery lagging broader retail in the shift towards a customer focus, I was not surprised that the overall theme of the conference was building a better customer experience. Yael Cosset, Chief Digital Officer of Kroger gave a keynote with an impactful theme – focus on what is relevant, not necessarily on what is flashiest. That is, each company is going to need a unique experience for their customer base, and potentially even on each specific customer. While having the best functionality or the most bells and whistles might seem like the goal, what companies should truly be focusing on is building an experience that is relevant and impactful to the customer.
Grocers and retailers have the challenge of building an omnichannel experience now that home delivery and click and collect have taken off in grocery. The focus on flexibility and a positive experience the first time out must be top of mind. From a CPG perspective, having a superior product is no longer enough. Brands need to be storytellers and create lasting connections with their customers.
There is also an increased focus on social media and utilizing influencers and micro-influencers to help brands tell their stories and build the brand loyalty that they ultimately seek. Lastly, while not as flashy, we are seeing supply chains being upgraded and optimized with automation to help drive these front-end customer experiences and keep costs down as retailers shift to omnichannel.
The Opportunity of Digital & eCommerce
At conferences as large as this one, you’re always bound to have a myriad of statistics thrown at you from the various speakers. After four days, two stats stood out to me as the most impactful. First, current eCommerce penetration for grocery is only 1-2% depending on who you ask. Second, 65% of customers start their grocery shopping journey online, regardless of where they complete the purchase.
This tells us that there is a huge opportunity for grocery retailers to seize in eCommerce. The audience is there, it’s now up to retailers to create the experiences to shift buying habits online. From both a CPG and retailer perspective there was a huge emphasis on harnessing the power of recipes online. Searching for a recipe shows intent to cook – which generally is required prior to the intent to buy. Making recipes shoppable, whether on a brand page or the retailer’s site is an easy way to make the journey optimal for customers. Layering in online functionality such as personalized promotions and pricing, suggested products based on past purchases, showing guaranteed product life for fresh goods, or suggesting healthy alternatives are all pieces that can now be implemented online or to engage customers and make online shopping easier.
Data, Data, Data
As should be no surprise, there was also an emphasis on data and analytics as an enabler of the themes above. Customer and loyalty data drives the personalization required to provide curated experiences to customers. This hyper-personalization has become table stakes for most online retail, and grocery is no exception.
Andy Katz-Mayfield, Co-Founder and CEO of Harry’s, spoke about how a solid technology platform and strong analytics are now vital for consumer brands, especially ones that are looking to go direct to consumer. Perhaps my favorite example of a company utilizing data as a competitive advantage is Winc, the online personalized wine club. Their data and analytics not only drive which wines are sent to their club members, but also help them determine which wines they should be making to begin with, as they produce their own wines. We also see CPG and retail partnering together to leverage eCommerce data, as it gives an all new insight on their shoppers that in-store baskets miss. One focus: unlocking the “digital impulse buy” and finding new complimentary products that consumers didn’t know existed.
Overall Groceryshop 2018 was a great first edition and looks to be a powerhouse conference for years to come. It’s an exciting time for grocery, and as we have seen disruption push broader retail to new heights we can expect the same to happen for this industry.
To learn more about Clarkston’s experience helping grocers and retailers tackle these trends, subscribe to our insights below or contact us today.