The Future Of Grocery Shopping And The Need For Automation

Consider how people in ancient Rome shopped for food — it’s not much different from how people shop today. Certainly, there were no frozen-food sections back then, but similar to today, people went to nearby markets and handpicked their fruits, vegetables, meats, and breads. Maybe the supply chain wasn’t as complex, but the experience was close to the same. But now, after 2,000 years, grocery shopping finally seems to be in for a drastic change.

Current Trends In The Grocery World

It is interesting to note the mix of recent trends in the grocery world — some have occurred repeatedly over time (the plagues and pandemics that caused shortages of foods and increased demands) while others are very new.

  • Demand: Recent health and safety concerns brought on by the COVID-19 pandemic are causing families to eat more meals at home. This is in turn boosting overall demand at grocery stores, both in-store and online. U.S.-based grocers have seen a 10% increase in year-over-year demand, and grocers that were not well prepared to handle the increased volume are now scrambling to prepare their supply chains for the future.
  • Urbanization: Populations migrating to metropolitan areas is another trend that is not new but has accelerated in recent years. As a result, grocers are bringing more stores closer to consumers but with less shopping space. These smaller store formats require the supply chain to deliver goods more frequently and in smaller quantities to be more reactive to replenishment needs. This trend will continue even through COVID-19 has caused a momentary pause in some cities.
  • Tracking: Food safety has always been a concern. However, since 2011 tracking and regulating the food supply chain has become more focused to meet standards set in the Food Safety and Modernization Act (FSMA) in the United States and other, often more stringent regulations, in other countries.
  • Health and Safety: Consumer purchasing behaviors have historically revolved around three attributes: quality, assortment, and price. And while they remain important to the consumer, health and safety is the new priority, and grocers have had to adapt their offerings and operations to support it.
  • E-Commerce: The latest trend is the boom to e-Commerce grocery shopping. Digital sales accounted for 1–3% of total grocery sales pre-COVID-19. Within a matter of weeks, digital volumes have been fast-tracked and now account for approximately 10% of total grocery sales in 2020. Very few grocers were equipped to handle the low levels of e-Commerce orders before, but everybody is challenged by the high levels now.

Upcoming Changes To The Customer Experience

The grocery customer experience will undergo a significant transformation. Some of the areas that will change:

  • In-Store Experience: The in-store experience at grocery stores has remained largely unchanged for many years. Other verticals such as general merchandise and apparel have already faced the need to make big adjustments and found ways to advance in-store engagement, creating more of an experience as opposed to just interacting with their products.
  • Omnichannel Customer Engagement: Consumers expect to make purchases whenever, wherever, and however they want. And they have the same expectations for their delivery. Grocers need to develop their ordering and fulfillment capabilities to meet these demands. Again, general merchandise and apparel retailers blazed a trail and grocers can take cues. For example, instead of just using past purchasing history to create recommendations for a current order, grocers should adapt their websites to attract customers to impulse purchases through pop-up ads and promotions.
  • T-Commerce…the Touchless (and Known Touch) Experience: Creating a touchless experience has become critical in setting consumer minds at ease to ensure health and safety. Consumers want to know where their goods are coming from and who has interacted with their grocery purchases.
  • Unified Commerce: Grocers need to connect customer data and product data. This connected commerce approach allows for a more personalized customer experiences, better forecasting and replenishment algorithms, and higher customer satisfaction. Using delivery companies (for example, InstaCart, Shipt) prevents connected commerce because they don’t share their data with grocers.
  • Emphasis on Local Ties: Consumers, especially younger ones, put a high priority on supporting their local communities, whether that be through local sourcing, supporting local causes, giving back to the community, or creating more local-specific experiences.

Automation And The Coming Change

Even in this brief glance at the trends and upcoming changes in customer experience, it’s clear the grocery world is experiencing massive change. The COVID-19 pandemic has only accelerated this — the buying habits of grocery shoppers have been altered and the industry as whole disrupted.

Grocers and food & beverage manufacturers need to take lessons from other types of retailers who have already drastically changed shopping experiences over the last decade. A good place to start is to consider automation options —omnichannel distribution strategies, micro-fulfillment centers, mixed-case pallets solutions, and high-rise vertical storage. It’s definitely not a one-size, and it a significant process to identify and apply the right technologies. But after 2,000 years of relative sameness in the grocery shopping experience, it’s time to embrace the change.

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