Solving the Disconnect in the Digital Grocery Journey
In the dawn of the new age of grocery retailing, brick-and-mortar grocers need to improve the integration of digital to win more sales both on- and offline. This theme resonated throughout a Sept. 19 webinar hosted by retail consultancy Brick Meets Click that featured Minnesota grocer Lunds & Byerlys and Toronto-based ecommerce solutions provider Unata. Progressive Grocer served as exclusive trade media partner of the event.
Connecting the Dots
David Bishop, partner at Barrington, Ill.-based Brick Meets Click, opened with insights from recent proprietary research examining how online shopping behaviors have changed between 2017 and 2015. He shared five realities connecting digital to physical that brands and retailers need to understand and embrace:
- Ecommerce is evolving how we shop: Brick Meets Click’s key shopper metrics point to continued growth in online shopping for groceries, highlighting that online’s share of grocery spending is climbing as more households are going online to buy groceries, and doing so more frequently. “We’re also seeing likelihood-to-purchase-again metrics grow, suggesting that experiences and perceived value of using are improving, which both are strong indicators for growth in usage,” Bishop mentioned.
- Ecommerce is transforming the marketplace, providing consumers many more ways to buy groceries: Mapping the competitive market illustrated how this is driven by emerging, digital platforms and new services from brick-and-mortar retailers. “Regardless of whether these are viable models or not, consumers are being exposed to new experiences, value propositions and shopping tools,” Bishop said, “which means traditional grocers need to also improve along these lines.”
- The digital store front’s impact will expand in various ways for brick-and-mortar grocers: Insights from Brick Meets Click’s Grocery eCommerce Sales Scorecard show that while physical stores are wrestling with margin pressures due to price deflation and increased competition, digital is experiencing robust year-over-year growth, and its contribution to the total store rises as the program matures over time. “Retailers are focusing on ecommerce to offset or reduce the effect of in-store sales declines,” Bishop noted. “However, many understand that it can help drive traffic back into the store.”
- The physical store strengthens the digital one: Having a physical location positions the retailer closer to the end consumer, addressing the “last-mile” challenge that mainly digital-only players face. This proximity to the consumer also creates stronger, more meaningful connections as consumers rely on these retailers for more of their everyday grocery needs. Bishop pointed out that “Amazon is learning what it takes to compete in grocery – especially fresh departments – and how they’re evolving their approach to grocery illustrates their learning curve.”
- Digital and physical are synergistic: Although ecommerce drives most of the growth for brick-and-mortar grocers today, it represents around 5 percent of total sales on average today, according the Brick Meets Click’s Sales Scorecard. “Ecommerce platforms leverage many digital tools that, in fact, can also help enhance the physical, in-store experience,” Bishop observed. For instance, using digital capabilities to find products in the store, take advantage of more relevant deals and even skip the checkout lines can make the in-store experience quicker and easier for shoppers.
So, while much of the attention is on how to respond to the growth of ecommerce, supermarkets need to increase their focus on how to leverage and integrate digital assets and capabilities to enhance how consumers shop for groceries on- and offline.
Envisioning the Future
Chris Bryson, Founder & CEO of Unata, shared his company’s vision for creating a more connected, digital or, what some refer to as omnichannel, experience. Bryson described omnichannel as creating an “everything, everywhere, anytime, any way” consumer experience, which creates greater access, convenience and flexibility relative to how consumers connect to content and commerce.
“We’ve learned from our experience that those who shop online still come into the store, which, in fact, they do every week,” he added. “So we need solutions that allow shoppers the ability to switch from one context to the next, based on what’s most convenient to them at that time."
This vision helps to address three challenges many supermarkets face with their digital assets:
- “Island syndrome,” which is caused by patching together a digital experience based on features sourced from different providers that don’t communicate with each other.
- “Continent collision,” which is created by offering too many choices that don’t align or reflect what the shopper is trying to accomplish, making for a more confusing and clunky experience.
- “Commerce split from content,” which happens when the act of buying is disconnected from the source of inspiration, whether that’s found in the digital circular, coupons or recipes, to name a few.
To create a more simplified and unified experience, Bryson suggested a three-pronged strategy that consists of:
- Connecting the various features into a single site, which will also help leverage many cross-merchandising opportunities currently being lost.
- Designing the experience based on what the shopper wants to accomplish, and making it easier for them to interact with content and switch between shopping modes.
- Integrating content so that it interacts with commerce, helping translate interest into products being added into the cart.
Bringing It to Life
Kevin Baartman, VP of information services at Edina, Minn.-based Lunds & Byerlys, highlighted features that help the retailer create a more unified experience by designing the journey that aligns with how a consumer wants to shop for groceries.
Following Lunds & Byerlys' recent launch of Unata’s upgraded platform, visitors to its ecommerce site are now prompted to choose how they intend to shop, whether they’re making a list for an in-store visit or ordering online for either pickup or delivery. This approach helps adjust the experience to the shopper’s intent while also making it easier for shoppers to switch between modes if they change their minds.
The shopping-intent feature also adjusts the assortment options based on added context. “If you’re in list-making mode, you’ll see what’s available based on the store selected, and if you’re ordering online for pickup or delivery, we’ll adjust the assortment, too, as we don’t offer hot foods, for example, as part of our pickup or delivery service,” Baartman pointed out.
Another feature that improves the experience relates to the integration of coupons. Baartman showed various ways in which shoppers can search deals.
For instance, after selecting an item, the shopper will see any available offers on that item, along with the conditions of the deal (e.g., buy two and save). The deals also appear on the shopping lists as an added prompt in case the shopper didn’t see them earlier, making it easier to take advantage of digital deals that are easily added to the cart.
Baartman also showed the ease of moving items from the shopping list into a cart if a shopper realizes that he or she doesn’t have time to shop the store, for instance.
This more intuitive approach and user experience is helping re-accelerate online sales growth for Lunds & Byerlys, which, as Baartman noted, has experienced double-digit sales growth since launching its upgraded ecommerce platform.
To view a recording of the session, click here.