EXPERT ANALYSIS
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Digital Engagement Ramping up in Supermarkets
More grocery retailers are connecting with customers’ smartphones in stores to deliver personalized
offers, enable viewing of the digital circular, and so forth.
Here is the latest evidence:
- Marsh Supermarkets has deployed a closed-loop iBeacon platform in all it stores to engage with shoppers carrying a smartphone or Apple Watch.
- Tesco in the U.K. is the first supermarket retailer to launch a basic version of a shopping app for Google’s Glass eyewear.
- Save Mart Supermarkets is increasing its options for mobile payment at checkout with the debut of Apple Pay in all of its 217 stores.
DISCUSSION QUESTIONS:
What the state of mobile marketing among grocery retailers? Will the ability to deploy a mobile strategy decide winners and losers in the marketplace? How receptive to mobile marketing are grocery shoppers?
EXPERT ANALYSIS:
Ignoring mobile in grocery is, in essence, ignoring your customers. Grocery shopping has become a mobile-entwined experience, with shoppers using digital devices to research products, create shopping lists, get coupons, check prices, make payments, and more.
A recent NinthDecimal report sheds light on how mobile has permeated the consumer packaged goods purchase journey. Of the consumers surveyed, 69% would rather save mobile coupons versus printing them, 59% prefer to use mobile devices for shopping lists, and 86% use mobile devices to help prepare for their shopping trip.
The move toward mobile reliance provides ample opportunity for grocery retailers to inform, engage and satisfy shoppers. From digitizing your weekly circular so it’s accessible on smartphones to offering and continuing to enhance your mobile applications to homing in on your shoppers’ mobile devices with targeted offers while they’re in-store, mobile has the power to enhance what all grocery retailers are after: a differentiated shopping experience.
As with any enterprise initiative, retailers are at varying levels on the mobile maturity curve. What we’re seeing, however, is that nearly all grocery retailers are looking to address one major piece of the mobile puzzle: how to obtain the vast quantity of product images and information they need to accurately represent and market their products on mobile devices.
Having a digital representation of retailers’ product assortments is make-or-break in the mobile game. Shoppers are conducting more research during the pre-shop and then planning their grocery store visits accordingly. The availability of product information on mobile can be the deciding factor as to whether a consumer enters your brick-and-mortar store, and that alone makes mobile mission-critical for grocery retailers.
Sue Sentell, CEO and President, Gladson
What is the state of mobile marketing among grocery retailers?
In 2014, SAP used social sentiment data to create a profile of the new grocery consumer. What we found was that price is still a driving factor and the majority of American households look for discounts when they head to the supermarket. We also know that between 2010 and 2012, interest in online coupons surged - from 15 percent to 47 percent, indicating that shoppers are actively looking for discounts.(1)
A 2013 Retail Feedback Group survey also indicated that 76 percent of grocery shoppers were likely to use their smartphone for digital coupons.(2)
So we know that the market is ready, but what about the grocers? The key for grocers is to push the right messages, promotions and discounts to consumers, creating value and improving loyalty. Without making a personal connection or offering something of value, consumers quickly lose interest.
So, we’re seeing mobile marketing happen in a couple of ways: first, grocers are tapping into big data that can help them personalize the shopping experience and better connect customized offers with shopper behaviors or actual purchase history.
Second; were seeing grocers start to deploy technologies like beacons, which can offer discounts at the “point-of-decision.” When implemented correctly, beacons can push offers also tied to a shopper’s loyalty data or history.
Third; we’re seeing grocers approach the relationship with shoppers from an omni-channel perspective. When a shopper interacts with a grocer online, or even through the POS, this data can be tracked and use to improve the relationship. Marketing can then decide to use mobile or social channels for offers, depending on the status of the relationship.
And, lastly; there’s a merger taking place between marketing and merchandising. Marketing teams have become aware that product does matter and merchandising teams have realized that they can access their customers and have positive financial impact by utilizing marketing’s access to the customer on a mobile device.
Will the ability to deploy a mobile strategy decide winners and losers in the marketplace?
Over time, yes. A recent Nielsen study found that as of Q1 2014, for the first time, a majority of Americans of all age groups own smartphones. There is a clear opportunity for grocery stores to engage consumers of all ages.
The average shopper has diversified their requirements when choosing a retailer. It’s no longer just about the food - shoppers have come to expect additional experiences and services. Due to this complacency in the “average” shopping experience, retailers are finding there is an increased need for tailored experiences and relevant loyalty programs.
Leveraging technology and mobile strategies can provide insights into the types of experiences shoppers are responding to, as the retail environment continues to evolve. We anticipate seeing grocers try many different tactics, as we see the differences in approach from Marsh, Tesco and Save Mart. Over time, the industry will learn which tactics stick, and which fall by the wayside. But grocery stores that don’t pay attention, or don’t listen to shopper demands, will start to lose market share in the next 18-24 months.
How receptive to mobile marketing are grocery shoppers?
The comfort level for mobile marketing has been increasing among shoppers, and may soon tip past the point from an interest, to a demand.
But, for consumers to hand over mobile access to any brand, retailer or grocer, the consumer needs to see clear value. This is where the will be a split in perception. Consumers that have a bad mobile marketing experience right away may steer clear of future mobile marketing environments. But those shoppers that download an app, fully buy into the loyalty program and are rewarded with personalized experiences and “spot-on” offers, will be long-term cheerleaders.
A 2014 study from SAP found that sentiment toward grocery apps and technology was 62 percent positive, so it grocers can build true value into their apps, the adoption rate should continue to increase.
Randy Evins, Senior Principal, Food Drug & Convenience, SAP.
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