Sonata Software

The Race To Reinvent Grocery Shopping

Blog Post created by Sonata Software on Sep 7, 2018

 

 

Following is a white paper summary is written in association between Sonata Software & Bill Bishop, Chief Architect, and Co-founder, Brick Meets Click.

 

Digital innovations are driving consumers to reinvent how they shop and these innovations are coming from both large and small players who are developing new, digitally integrated value chains. The traditional value chain players (producers, CPG brands and retailers) are going to need to enhance their collaboration – especially around digital merchandising – in order to keep up.

 

Understanding The Race

According to a study by Deloitte, Digital is impacting 31% of F&B sales including a wide range of communication platforms such as apps, websites, and social media. These platforms offer consumers a wide variety of  grocery options that make it possible to skip the trip down the aisles entirely for some or all of a household’s purchases.

shopping options are also changing shopper expectations. Today’s shoppers have plenty of alternatives to choose from (Like Big basket, Grofers, Amazon, Flipkart etc.), dynamic exposure to deals and offers and on-demand delivery.

 

Find out where your shoppers are

Traditional grocery retailers need to understand how their customers are changing where and how they shop for groceries. CPG brands & other suppliers need to learn how consumers are prioritizing channel choice when buying their products (in-store,  or blended).

 

Ask these questions to understand your buyers better:

 

1. Which digital platforms are your customers using?
2. What channels are they using for different kinds of products?
3. Which digital influences do they pay attention to and/or rely on?
4. What are they looking for and not finding in terms of greater convenience, product information, assortment, and ease of shopping (such as ordering, fulfillment, payment, etc.)?

 

 

 

Once you position each digital innovation on the curve, you’ll have the information you need to decide when to make a significant investment. The current thinking is that it’s time to invest when the innovation is poised to move from Phase 1 to Phase 2, into the early mainstream market. Until then, less than 17% of consumers have adopted the innovation, and it’s still an open question as to whether it will ever reach the mainstream market.

 

How to race smarter


Today consumers have virtually unlimited choices. Criteria like "better for you," "organic," and "local" play more strongly for many products. As a result, shoppers are becoming more intentional about what they want to buy.

In this race to reinvent grocery shopping, everyone (supermarket retailers, wholesalers, CPG manufacturers, and other suppliers) will need to strengthen their collaboration around digital merchandising to fend off new options competing for the share of consumer mind and wallet – and to be present when consumers are making purchasing decisions. Shoppers are making decisions about where to shop and what to buy outside of a store. This means that if you're not present when they are making those decisions, you won't even have a chance to earn the sale.

 

So where to start?

Digital merchandising will be an increasingly important strategic skill because it gives the retailer and other players in the ecosystem "the ability to be present, in the context of the moment that a shopper is looking for something.

Here are six key steps to ensure your collaborative digital merchandising triggers a sale. 

 

The New Reality

Consumer reinvention of grocery shopping, driven by digital innovation, is changing the way brands and retailers interact with consumers. They now decide where and how to do their grocery spending based on how well different value chains meet their needs. Not only does this call for a shift to better digital merchandising skills for the players in the traditional value chain, it also means that those players need to work together to serve the customer.

So far, the traditional value chain still does more than 95% of the grocery business, but new digital methods and enhanced collaboration are needed to hold onto that business. The key challenge for the industry moving forward is to change the way we look at the world. We need to look at grocery shopping the way that consumer do – which is increasingly influenced and informed by what they see on their screens, even when they are making in-store purchases.

 

"Shoppers will determine who wins this race. Retailers and suppliers can go it alone, but in this environment, both will be more successful if they collaborate."   

 

Bill Bishop, Chief Architect, and Co-founder, Brick Meets Click

 

You can read the full white paper here: https://bit.ly/2Njw3f1

 

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