New Grocery Technology Piloted by Kroger, Microsoft Shows the Store of the Future

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New Grocery Technology Piloted by Kroger, Microsoft Shows the Store of the Future

01/07/2019
New Grocery Technology Piloted by Kroger, Microsoft Shows the Store of the Future
L-R: Microsoft CEO Satya Nadella and Kroger Chairman and CEO Rodney McMullen

The Kroger Co. and Redmond, Wash.-based technology company Microsoft Corp. are piloting a new smart technology system to transform two of the grocery giant's stores – as well as, potentially, other retailers' operations – in the way that they personalize the shopping experience and improve associate productivity.

Located near each company's headquarters, the stores – one in Redmond, Wash., and the other in Monroe, Ohio – are using Kroger Technology innovations powered by Microsoft Azure, Kroger's preferred cloud platform for retail as a service (RaaS). The two companies are also offering the same platform to other operators in the industry.

"Kroger is building a seamless ecosystem driven by data and technology to provide our customers with personalized food inspiration," said Rodney McMullen, Kroger's chairman and CEO. "We are identifying partners through Restock Kroger who will help us reinvent the customer experience and create new profit streams that will also accelerate our core business growth. We are excited to collaborate with Microsoft to redefine grocery retail."

The stores will offer customers a shopping experience "never before seen," bringing in the latest generation of the EDGE (Enhanced Display for Grocery Environment) Shelf digital display system. Rather than use traditional paper tags, EDGE Shelf communicates everything from pricing and promotions to nutritional and dietary information.

The solution connects through Microsoft Azure AI with Kroger's Scan, Bag, Go mobile checkout technology to create a unique guided shopping experience. A pick-to-light productivity feature helps direct shoppers' packing orders for curbside pickup via visual cues that help them quickly find products. Moreover, features such as Microsoft Azure-powered video analytics can help associates locate and deal with out-of-stocks.

The new shelf technology can alson help Kroger generate advertising revenue by selling space to consumer packaged goods (CPG) brands. Using video analytics, personalized offers and advertisements can be presented based on customer demographics.

While it's first being piloted at the two stores cited above, the new RaaS product is also available for other grocers to support key performance indicators (KPIs) and merchandising plans, collect customer insights, enhance employee productivity, reduce out-of-stocks, improve the customer experience and allow for hyperpersonalization through proprietary technology, including the EDGE Shelf.

Future commercial products include Scan, Bag, Go; Virtual Store Manager; the sensor network; and connectors to corporate systems like point of sale, and inventory management, tag and merchandising systems.

The Kroger Co. operates a seamless digital shopping experience and 2,800 retail food stores under a variety of banner names nationwide. The Cincinnati-based company is No. 2 on Progressive Grocer's 2018 Super 50 list of the top grocers in the United States. It was also named Progressive Grocer's 2018 Retailer of the Year.