Why Context Matters in Commerce

The holy grail, if you will, of today’s marketing and merchandising efforts is to reach customers with the right offer, at the right time and at the right price. To help grocers at different points on that epic quest, a trio of leaders at e-commerce software company Mercatus took to the stage at Progressive Grocer’s GroceryTech event in Dallas in a workshop focused on contextualized commerce.

That term denotes an approach to getting to getting all of the “rights” right, said Mark Fairhurst, global chief growth officer at Mercatus. “Contextualized commerce is based on the twin values of value and convenience, because we know those two factors motivate consumers today,” he said, adding that food retailers of all sizes and scales have opportunities to pursue contextualized commerce on a level playing field in a competitive environment. 

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Randy Crimmins, president of Mercatus’s AisleOne, A Relationshop Company, business, expanded on that notion. “It’s always been about convenience and value in grocery. But the paradigm is a little different now, how it plays it in the store and across the experience. To me, convenience is how you personalize that experience and curate it to how it is relevant to me and my family in how we shop,” he declared. 

Mercatus, which regularly tracks and publishes reports on consumer behaviors and market trends, suggests leaning into traditional strengths and translating those into digital experiences to optimize resources while staying competitive. An example of leaning into strengths is looking at the weekly circular in a new and more digitalized and personalized way. 

“We have data and technology to create experiences to drive your shoppers online and start to migrate from dependency on the print circular. It’s not as simple as flipping a switch, but with machine learning and AI, there is an opportunity to disrupt this process internally as well as externally. It’s an exciting time to break down that barrier,” Crimmins asserted. For instance, a health-conscious shopper may have a digital circular promoting fresh produce and other better-for-you options, while a customer looking for convenient family meals may have different offerings populated on the front page of their online circular. 

In addition to leaning into strengths, it’s crucial to heed potential gaps. “One thing that I will note from an operations standpoint is there are a lot of new opportunities, but that also comes with a new set of challenges,” said Lee Lambeth, VP, retail operations at Mercatus, citing an example. “A couple of years back with the rise of apps, everybody said, ‘Look, we want the customer to be connected to the store, so we want you to be engaged in your app from the time you enter to the time you exit the store.’ One of the challenges that we ran into in the store operations, though, was that some stores weren't set up with the right Wifi and the right connectivity. So, in theory, every one of these applications has merit, but you also have to understand that there are hurdles that could come that you're going to have to get around and navigate.”

Data is essential in combining traditional strengths with new online paths for growth, through e-commerce and other activations. “The more you know about your shopper, the more you understand them and can grow the relationship,” noted Crimmins. “Context matters, in understanding who your shoppers are and their value to your organization.”

Additionally, a contextualized approach drills down with personalized, localized and connected tactics that engage shoppers from initial impressions through in-store and online transactions. “If you had to hone in on what’s most important about the definition of contextualized commerce, it is the focus on localization and personalization -- how to make the experience unified and connected,” asserted Crimmins. 

Added Lambeth: “It all conveys the brand promise that retailers try to promote to consumers.”

Measurement is core to contextualized commerce as well. The Mercatus experts suggested five key performance indicators to target, including customer lifetime value, incremental activity and spending, customer migration and purchase consolidation, impressions to transactions and growing market share.