Technological advances are taking place online and in-store that are changing shopping as we know it.
The expectations of shoppers have changed and given the convenience of online shopping, the grocery stores of the future need to give customers new reasons to visit them and create a more memorable shopping experience.
They need to provide value, convenience, social engagement, and innovative experiences.
In the face of disruption and transformation, the real issue is whether retailers have good business models that allow them to adapt to constant change.
The Internet of Things (IoT) technology gives them an opportunity to develop an infrastructure that makes physical things smart – such as mobile phones, shopping baskets, digital displays, shelves, and even products.
Here are some of the ways the Internet of Things (IoT) is being used to create value for customers.
A physical store goes digital
If you want to get some idea of what a supermarket of the future may look like, one of Italy’s largest grocer’s, Coop Italia, has used the Internet of Things (IoT) to develop an ultra-modern version of the traditional local food market.
In Milan, Italy, they have built a large grocery store that features pioneering digital solutions developed by Carlo Ratti Associati.
The store in Milan incorporates interactive food tables, real-time data visualizations, and smart shelves.
As shoppers point to a product, extra information appears on a suspended digital mirror – this is a seamless augmented reality without having to use a cumbersome device.
Each product has a story to tell about its origin, nutritional properties, the presence of allergens, carbon footprint, etc. The experience is made possible by Microsoft Kinect sensors that can interpret body signals.
A juice-making robot and other engaging uses of technology all add a responsive dimension to the grocery shopping experience.
With the use of the Internet of Things (IoT), cluttered aisles, vertical shelves and lack of access to information are being replaced by low, well-designed shelves, organized displays, and digital screens.
Searching the shelves to find a specific product will be a thing of the past with the development of apps that guide shoppers while they’re inside the store.
Sensors in store shelves track items customers put in carts and bill their mobile payment systems.
This is already happening at the Amazon Go concept store where shoppers register, remove items from shelves and leave without having to check out as payment is automatically deducted via smartphone.
The Internet of Things (IoT) is what makes this type of infrastructure possible.
The Farmhouse Market is a 24-hour grocer in New Prague, MN that is combining cutting-edge technology and small-town values.
Approved shoppers pay $99 a year to access the shop with a key card, gather goods, and pay via a self-checkout counter.
People all over the world are becoming more aware of food safety and are curious about how products are sourced and screened. It’s this desire that underlies some of the technological innovations.
In the very near future, we will be able to know everything about a piece of fruit on a shelf – we will know its story from the tree to the shelf.
We will know the whole journey of a chicken from the hatchery to the shelf, including breeding, feeding, and care.
In 2018, a number of retailers, including Carrefour, adopted blockchain technology to give consumers access to detailed information on the origin of products.
It reassures them about the quality of what they’re buying and allows them to avoid products with antibiotics, genetically modified organisms, and pesticides.
Carrefour has already launched blockchain information for 20 items, such as eggs, raw milk, cheese, and pork. It will continue to add many more this year.
Retailers will need to start leveraging a more personalized shopping experience. They need to make shoppers feel as though they receiving individual treatment.
Predictive analytics make it possible to create highly personalized loyalty programs based on customer preferences and behavior.
Retailers who employ a customer-insight driven approach throughout the shopping experience are those who are likely to lead the pack.
They will be able to target products and offers more effectively and use insights to inform their strategies, from procurement to product placement and promotions.
Improvements in supply chain
The demand for freshness and the pressure to cut waste means stock deliveries will have to be improved. With more automation and access to data, new retailing models are likely to develop.
For example, grocery stores may choose to reduce on-site running costs by becoming smaller and dedicating a large proportion of shelving to fresh produce.
A final thought
As shoppers interact with a more transparent supply chain, it’s likely to encourage more use of fresh, local products.
A grocery store may even become the new gathering place, where shoppers enjoy an ultra-modern and pleasurable shopping experience as well as develop more sustainable consumption habits.