Mark Alexander is director of retail technology at C&S Wholesale Grocers Inc., Keene, N.H., the country’s largest grocery distributor. The views expressed here are those of the author.
The year 2020 will long live in our memories much like other tragic events in the history of our country. Many of us are eager to return to normal ways but "normal" now has a new definition. Although the pandemic stopped growth of many service businesses, it revitalized many independent grocers and also fast-tracked technology enhancements and adoption. Some say it has fast-forwarded supermarket technology by five to 10 years.
During this past year the consumer has also changed. Experts tell us that habits can be formed in 30 to 180 days and, on average, it takes 66 days for a habit to become automatic. This means that many of the shopping patterns formed over the past months will remain the primary method of shopping for a majority of consumers. Online shopping, curbside pickup and touchless checkout are all now mandatory to stay competitive based on what the consumers are telling us with their wallets.
Consumers are also shopping less, based on studies by McKinsey & Company. Trips are fewer, but larger baskets and lists are more important than ever before. Instead of lingering in the supermarket, consumers are on a mission to get in and get out. While this pattern may wane a bit as life returns to some normalcy, it will not return to pre-2020 shopping patterns.
Here are some strategies that are needed to help the independent grocer thrive in the coming years:
Whether this be e-commerce, enhancing your website or actively managing social media, independent grocers need to be online now to survive. From a report in the Washington Post in January 2021, the Baby Boomer generation (including those over 65) is the fastest-growing segment utilizing grocery online shopping. Much of this stems from the pandemic with this group being one of the most vulnerable to COVID. Many have stated that once they tried it they loved it so much that they won’t go back to shopping for the bulk of their groceries in person.
A grocer’s website and social media presence are an important part to the digital strategy. Independents need to ensure that their online presentation is fresh and inviting. If your website is tired and old-looking, the perception will be that so is your in-store presentation. Think of your website as the porch or vestibule of your digital store. If you pride yourself on getting that first impression right in the physical store, devote as much time and resources to your digital first impression.
With the concerns about social distancing, traditional self-checkout solutions as well as emerging scan-and-go technologies have seen a large increase in usage. Amazon Go has motivated many of the major chains to begin developing cashierless checkout. Even pre-COVID, the consumer trends had been towards self-service. I know that many Independents have touted their customer service but the definition of customer service has changed. Great customer service is different for every consumer. Grocers needs to keep all their options open and not view customer service by their definition.
Offer a Membership Loyalty Program
When we talk about loyalty marketing we are not talking about the shotgun approach to loyalty that was used by the industry five or 10 years ago. That form of loyalty marketing offered the same rewards to groups of consumers based on group performance goals such as spend $200 and get ‘x’ as a reward.
Today’s consumer has many avenues where they can look for information and shop. Personalized marketing does not mean just creating personalized suggestions. It also means communicating to the consumer on the device(s) they are most apt to use during the day and when they are in process of making shopping decisions.
Everyone likes to receive communication that is targeted just for them or their interests. Personalization also provides exceptional customer service, which in turn impacts sales and profits since happy consumers spend more. If you can provide a tighter relationship with your consumers, they will trust you and spend more with you.
Adapt your Marketing Strategies
Psychological studies have shown that the sense of touch (Haptic) remains the chief argument for printed campaigns, ad circulars and printed graphic materials. Human behavior shows that we remember encounters longer and more deeply when we physically interact with an object rather than just viewing it online. That’s certainly not saying that digital is a passing fad by any means, but your marketing strategy needs to embrace all the marketing tools available to achieve maximum market penetration.
The days of sending thousands of printed circulars out each week are gone. You can use your marketing dollars more wisely and even cut expenses. Printed marketing, as noted, still has value when used in a comprehensive marketing strategy that helps you touch as many people as possible through both printed and digital methods.
Review Store Décor and Layout
With all the talk of the digital world and online shopping you would think the physical store is disappearing. But the majority of consumers still enjoy shopping in a physical store and will most likely for many years to come. The store will however need to go through a revival of sorts since consumer habits have changed and will continue to change.
The pandemic has shown that many consumers have had to adapt and eat more at home. While this means some are cooking more, for most they are looking for meal solutions ready to eat. And the pandemic has impacted self-service food areas which may see the greatest long term negative impact from the changing habits.
With the boom of online shopping, many center store sales have migrated online. Grocers need to review these commodities and see whether the amount of space and inventory is still warranted based on the sales and profits.
With all the changes to product mix, grocers should review their store layouts and space requirements for certain departments — to accommodate new consumer habits for organic and natural to finding space for new services, like e-commerce pickup lockers, grab-and-go cases and more.
With remote working becoming the new normal for many non-service businesses, grocers need to find ways of reaching those consumers. Many will not be stopping by the supermarket on their way home anymore or venturing out of the office over lunch. For the independent grocer it’s time to take a step back, evaluate your operations from a new perspective, be willing to change, think creatively and develop a plan for future growth.
C&S Wholesale Grocers Inc. is the largest wholesale grocery supply company in the U.S. and the industry leader in supply chain innovation. Founded in 1918 as a supplier to independent grocery stores, C&S now services customers of all sizes, supplying more than 7,700 independent supermarkets, chain stores, military bases and institutions with over 137,000 different products. C&S is an engaged corporate citizen, supporting causes that positively impact our communities. To learn more, please visit www.cswg.com.