Connected Consumers
Food retailers discuss how best to engage today’s digital shoppers.
Getting a handle on the constantly evolving arena of mobile solutions was a major topic of discussion among the grocery executives who attended Progressive Grocers Connected Consumer Summit, held this past October in Chicago and sponsored by Verizon Enterprise Solutions.
With so many tools to choose from and new mobile solutions vendors emerging every day, finding the ideal app requires extensive planning and preparation to be done right.
Eleven retailers from nine of the most innovative grocery chains shared the challenges they face and the successes they’ve achieved in the adoption of customer-facing mobile solutions. They even put their heads together to build their own hypothetical app.
Roundtable participants were Mike Adams, loyalty and CRM analyst, Bashas’, Chandler, Ariz; Ron Bonacci, VP of marketing, K-VA-T Food Stores, Abingdon, Va.; Mike Brown, executive director, retail marketing services and technology, Unified Grocers, Commerce, Calif.; Tom Hutchison, director of CRM and marketing, Raley’s Family of Fine Stores, West Sacramento, Calif.; Jana Jeffery, digital community manager, Albertsons LLC, Boise, Idaho; Gordon Jones, director, Business Development Directorate, Defense Commissary Agency, Fort Lee, Va.,; Glenn Kriczky, VP of information systems, Associated Wholesalers Inc., Robesonia, Pa.; David Palmer, VP of marketing, Raley’s; Heidi Reale, director of shopper and digital marketing, Price Chopper Supermarkets, Schenectady, N.Y.; Tom Riley, business systems manager, Price Chopper; Larry Schaffer, director of information technology, Niemann Foods Inc., Quincy, Ill.; Alexandra Sneed, retail and hospitality vertical, Verizon Enterprise Solutions, Basking Ridge, N.J.; and Jay Yanko, managing principal, Verizon Enterprise Solutions.
PROGRESSIVE GROCER: There are so many new and emerging players in the mobile space today. Every day, a new company comes out of nowhere announcing it’s the next big thing. As retailers and wholesalers, your phones must be ringing off the hook. Mike, you’ve likened this situation to the Wild West. Can you tell us why?
MIKE BROWN: We’re seeing all this mobile technology getting introduced — every day, there’s new providers popping up promising all kinds of things, and we’re just trying to understand their real value. It’s difficult to sift through the noise and determine which will actually help drive profit. Does it put us closer to the consumer? Will it help us move more product?
PG: That brings up a question. What are the types of functionalities that are important for a mobile app to have? Let’s explore this by building our own mobile app right here at the table. Assume we have an unlimited budget and top mobile app developers. Starting from scratch, we’ll go round robin and you tell me the types of functions and tools this grocery app should have.
JANA JEFFERY: A shopping list, the ability to display ads, and recipes.
TOM HUTCHISON: Within the shopping list, users should be able to check off items.
GORDON JONES: The ability to transfer recipe ingredients to the shopping list.
HUTCHISON: The ability to share that shopping list with your family members, as well as the ability to map out the items on the list and optimize the shopper’s path through the store.
PG: As we can already see, the subfunctions and integration of various components of the app are getting increasingly complex, and we’ve only just begun.
JONES: Loyalty functionality integrated into the app.
GLENN KRICZKY: And some means of tracking your status within the loyalty program.
JONES: A store-specific information section. A place where a grocer can post notices and local event information.
RON BONACCI: Meal solution information and offers. This can also be tied to recipes, and ultimately to the shopping list. And a geo-locating function that recognizes when a member enters the store, and targets specific offers to that shopper.
TOM HUTCHISON: There can be some sort of weekly planning function tied to the meal solutions, so shoppers can build their meals for the week.
KRICZKY: User maintenance capabilities, allowing users to easily update or change their profile.
JONES: The ability to scan products to add them to the shopping list.
JEFFERY: Purchase histories, and the ability to add items from previous receipts to a current shopping list.
JONES: Multiple shopping lists.
HUTCHISON: Suggested items. For example, if I buy a bottle of Jack Daniel’s every six weeks, at five weeks it should be added to my list. Recommendations are an easy way to add to your list based off history and categories purchased.
HEIDI REALE: Coupons. The ability to search for digital coupons, so when I am in the cereal aisle, I can see if there are any relevant coupons available.
THOM RILEY: One big area that we’re looking at is health care for the whole family, such as refill reminders.
DAVID PALMER: Health and nutrition guidance, and the ability to track it.
JAY YANKO: Tracking your pantry inventory at home.
JEFFERY: The ability for grocers to analyze how shoppers use the app, what they are looking at, how they build their lists.
PALMER: In my mind, mobile should be absolutely intuitive, and every single thing possible should be available, because, as a consumer, I have experienced solutions across the hundred apps I have downloaded, and so I expect certain functions to be available.
PG: So the ideal mobile app should include every one of the tools we discussed?
PALMER: And 10 times more than that. Now, I might not take advantage of them. I might not even know some of them are there. But as I get more engaged with the app and learn more about it, I may find them useful. You can overwhelm a user, sure. But you’ve got a million-plus customers who are shopping our store and our loyalty program, and you probably have 10,000 different ways that consumers could engage with that solution.
And ideally, if you’re really looking at the customer, you’re going to deliver what they want, when they want it, and the way that they want it. If they want to engage more, great. If they want to engage less, that’s great, too.
But building the app in that intuitive way is a challenge. Probably as big or an even bigger challenge is having all the data structured and accessible in a way that is real-time and dynamic.
PG: Should it include social functionality?
PALMER: You probably would want to include that as well. So then I would want to have it in there.
PG: So you envision building it like the concept behind the iPhone — limited instructions, but easy to figure your way around it?
PALMER: That’s right, and as you engage more, you realize there are features there that unless you studied it, you wouldn’t realize were there. You become a better user.
So you don’t overwhelm people right out of the gate, because there may be four, five, 10 basic functions. And as I recall, the initial mobile apps were basically a store locator, shopping list and recipes, and then it built from that and integrated those together. You start searching a recipe, then figure out how to add recipe items to the list.
RILEY: We take a slightly different approach where we look at the entire digital space. We’ll look at the website. We’ll look at the mobile apps. We’ll look at social and try to design feature and functionality that will work across as many of those properties as we can, rather than just thinking about mobile or just thinking about the website.
One of our local competitors’ mobile strategies is disjointed, so that a certain feature may work fine on its website, but when you go to the mobile app, you literally are told that the feature doesn’t carry forward into the mobile space. So their strategy is disconnected.
Whereas if you go with the other approach, you ask, do customers want to use coupons on the website? Yes. Do they want to use coupons on mobile? Yes. They can use it right in the store as they’re thinking about it.
You have to explore all of the “what if?” scenarios. Do customers want to be able to do coupons on Facebook? Ten it’s no longer a question of should we, but rather a matter of how to get it done. So we start evaluating technology partners based on whether or not they can provide these capabilities.
REALE: Our customers access our digital coupons either via mobile or the web. But they are beginning to lean toward mobile. About 40 percent of our emails are being opened on mobile devices.
So, while we may not consider our customers early adapters of technology — some have smart-phones, some don’t — we have a decent amount of data to tell us that they are moving to mobile.
PG : How do you collaborate with your suppliers as far as mobile ads and promotions?
JEFFERY: The suppliers do it through MyWebGrocer, which developed the app. That conversation happens with MyWebGrocer, and it runs across its network. It’s not specific to Albertsons.
RILEY: So [it] may not align at all with your strategy.
HUTCHISON: So it’s your app, and someone else’s choice of ad is showing up?
JEFFERY: Yes.
HUTCHISON: Are you getting a cut?
JEFFERY: It’s a revenue share. MyWebGrocer developed the app, and so they have the space in there for display advertising in the same way they do on the shopping-list sections and recipe sections of our website, too, which is on their network. We get a percentage of the space and rotation that we can use for items or programs that we want to promote, and a percentage of the space that we rotate, programs or items that we want to promote as well, but the rest of it is their network.
HUTCHISON: So it can’t be targeted?
JEFFERY: No.
LARRY SCHAFFER: (to the group) Who has an app deployed?
PALMER: We have a minor introductory one.
MIKE ADAMS: We have one from MyWebGrocer.
RILEY: We have our own app, but it’s powered by, or back-ended by, Mercatus Mercatus Technologies.
PALMER: Ours was built by somebody for us to accompany our loyalty program, but doesn’t have all the functionality we would like.
JEFFERY: Ours is by MyWebGrocer.
BONACCI: We’re in the process of converting to our own app.
RILEY: We view ours as more than just a mobile app, because it’s integrated into our online platform in real time. So, for instance, you can add items into a shopping list, or multiple shopping lists, but as you do that on the website, it’s also available for you on the app, and vice versa. It’s not disconnected. We treat the customer as a web and mobile user, as well as a social user. So the activity and the feature functionality is planned around all of those vehicles.
ALEXANDRA SNEED: That’s a key area of focus for Verizon, leveraging our capabilities and assets to enable those seamless connections, and providing a platform for centralized applications via the cloud and getting that one view of the customer across these applications.
And we have cloud, security, mobility and network all aligned to help solve some of the challenges around omni-channel and around tying it all together — the mobile, the web, the physical store and the social.
RILEY: We built a new iPad app, and we’re taking those core functions which would be recipe, shopping list, the fuel program, your points and that kind of stuff, and taking advantage of the larger screen of the tablet. And it is focused around meal planning.
REALE: So it’s not just our smartphone app resized for the iPad. It’s a different user experience. We believe the iPad, it’s used differently and for different things versus the phone, so it becomes a great meal-planning tool.
HUTCHISON: Is there consistency across the platforms?
RILEY: Yes. And the brand consistency is maintained.
PG: is your website mobilized?
Riley: Right now, we have a web-only website; we have not invested in a mobile-ready website. We have iOS and Android apps. We’re evaluating whether we go mobile-ready to address the potential of Windows having some kind of share or not. We’re not going to write a Windows app, at least [not] in our current strategy.
PALMER: Integration is key. We know that consumers are moving more engagement via mobile than they are on a fixed desktop. And by mobile, there’s a slight extension into tablets as well, and we feel that that is where we need to be first, but they need to be integrated together. They don’t have to be identical, but when I sit at my desktop computer and then five minutes later I’m in the store, I need to be able to see on my phone everything that I just did online, and that requires data and communication. So for us to deliver the dream, we have to have the data accessible, and it currently isn’t.
PG: What do you need to do to make that data accessible?
HUTCHISON: Master data management (MDM) is one piece. We need a customer master, store master, product master, everything organized in a way that allows us to quickly access that data we need for various tools. The rest is personalization and quick or automated analysis to immediately respond to that customer data. The simplest way to do this is to build algorithms and rules, but the longer view is you build a self-learning model.
YANKO: The challenge of MDM is keeping the data clean so that you can use it. And once you have this clean data, you centrally host the information and make it accessible via the cloud. This way, everyone is walking around with the ability to benefit from this data, whether it’s an associate or your customer, right from their hip whenever they need it.
An important point to remember is that when you start moving all of these things to a single place, a single point of vulnerability, so to speak, security and identity and access and control become very important. Now, most people think about Verizon as a telephone company, but what a lot of people don’t realize is we operate one of the largest security practices in the world. A few years ago, we acquired CyberTrust, a provider of managed security services, as quite a bit of the world’s Internet traffic goes across our infrastructure. So we have insight into most of the attacks that take place throughout the world.
“You have to explore all of the ‘what if?’ scenarios. Do customers want to be able to do coupons on Facebook? Then it’s no longer a question of should we, but rather a matter of how to get it done.”
“In my mind, mobile should be absolutely intuitive, and every single thing possible should be available, because, as a consumer, I have experienced solutions across the hundred apps I have downloaded, and so I expect certain functions to be available.”