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The changing technology landscape in grocery stores today

Image of retail workers using connected tablet device in a supermarket

Retail technology innovations that are getting massive coverage in the press often seem out of reach for smaller grocers. AI, robotics, IOT, and Blockchain often seem to be too futuristic; nice to speculate, but not anywhere close to being on the radar for independent and small private grocery store chains.

With limited IT budgets and extremely limited IT resources, small grocers have to come up with a strategy to outmaneuver the monster chains or even the newer “digital age” entrants to the market.

Personalization and intelligent use of technology – a winning combination for smaller retailers

A significant focus on personalization and shopping intimacy is working for lots of smaller operators who have invested in making their brand, assortment and shopping experience as unique as possible. However, that does not mean they’ve completely ignored all of the industry techno-hype either. Impressive examples of how independents and small grocery store chains have differentiated themselves are all around us. Exploitation of social media, ecommerce “markets” and conversational commerce have made their way into most retail segments and across most of the tiers too.

At almost every level, there is a consumer expectation that some form of technology will be present in every store, technology that is recognizable, visible and usable. Probably the best example of this is “free Wi-Fi” that is now an expectation anywhere consumers go and shop for an extended period of time.

Grocers that have deployed Wi-Fi across the store are also using that same infrastructure investment to help drive automation and efficiencies of both inventory and staff and at the same time, collect data on both consumer and employee behavior. Employing targeted marketing techniques, in-store offers directed to consumers, or joined-up strategies through interactive merchandising sets and beacon technology are not only driving sales, but also enhancing the brand relationship between the customer, the store and the brands they carry.

So back to our example, making the right selection in infrastructure like Wi-Fi can be an enabler for more advanced solutions that are coming. IoT, Edge/fog computing, machine vision, robotics all will require massive data movement inside the store and most of that will move across wireless networks, the same network that your customers will be using, your suppliers, and your employees too.

Security, capacity, resilience and sophistication of the overall design not only affect the wireless network, but also the overall performance and capabilities of the technology it interconnects. Clearly, one technology decision must account for a plurality of likely uses and users.

Making the most of customer data

Another example of exploiting technology investment strategy is managing the data collected in the store. Just like analyzing consumer behavior online, leading grocers can do the same with the massive amount of consumer-generated data in the store. Historically, POS data combined with customer opt-in identification (loyalty systems) provided an interesting view of consumer behavior, but only after the fact and at the enterprise level.

What’s been missing is real-time analytics that can and should be used to modify shopping behavior in the store while the customer is shopping.  All of the insights on consumer behavior such as path-to-purchase, dwell time, basket size, assortment selection traditionally led to basic conversion rate statistics.  Now, by accumulating all of the historical information on the consumer, adding data from other sources and analyzing that data in real-time we can not just predict behavior but more importantly drive it. This requires some pretty sophisticated technology both in the store and outside working together and at an unbelievable speed to influence consumer behavior before they arrive at checkout.

The technologies used to bring forward these insights are maturing at an astonishing rate and are now becoming commercially available to independent grocers and smaller chains in more “off-the-shelf” cloud-based subscription service models. What’s key here is having the core technology in place in the store and the ability to harvest data from store systems and infrastructure. As new store system buying decisions are being made, maximizing the benefits from those investments is becoming more and more strategically important.

What grocers invest in today will have a long-term impact on operational costs, revenue and competitive relevance for the next several years. Getting the foundation right, right now, is critical and looking for solutions that will support and be highly adaptable for all of the technology opportunities that are coming is key.

Delivering strategic advantage through joined-up in-store technology

At checkout, POS and Self-Checkout, scanning and printing technology decisions have been really the same old approach every five to ten years. But now, there are much more advanced, open architecture alternatives affecting platform and asset buying decisions. They are becoming much more mainstream and hold the key to future agility and responsiveness necessary for Grocers to compete.

Adding “modules” to POS, for example, is important, whether those modules come from the POS solution provider, or a partner or a third party. This is a powerful competitive weapon for Grocers and ones now more readily available to small chains and independents as well. Integrating modules has to be fast and easy and SaaS solutions that can be connected or removed quickly are requirements for competitive retailing today.

POS, once thought of at the last technology interface with a consumer in the store, now has become the central hub to interconnect many of the systems that drive the overall store operation, efficiency and sales. Enterprise transaction engines that power POS and eCom are now becoming a centralized layer of the overall store system “fabric”, just as important as Inventory and Order Management.

Whether it’s in-store café service, staff mobility, checkout automation, digital media, pricing and promotions, assortment planning, the unification of the Grocer’s competitive strategy may very easily succeed or fail based on the store infrastructure and platform investment decision being made today.

If you are attending the NGA show 19 next week, please stop by our Fujitsu booth # 212 and discover how our latest retail innovations are helping organizations today in their digital transformation journey.

For more information, please check out our microsite http://www.fujitsu.com/us/microsite/nga/index.html.

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