Grocers Have No Choice: Adapt, or Become a Statistic
As customer behaviors change rapidly during this unprecedented time, the grocery store as we know it must change, too.
April 17, 2020 / Christopher Hill, VP QuickCollect Solutions
We are in the midst of a significant shift as the retail industry adapts to new regulations, new customer interaction formats and ever-evolving consumer expectations.
The grocery store is a standout in this environment.
Due to COVID-19, our lives as consumers function differently when fulfilling basic needs, like how we get our groceries. The most interesting statistic I reviewed from National Association of Convenience Stores is that app downloads from some of the top e-grocer and delivery companies, like Instacart and Walmart, have increased an average of 167%.
NACS also reported that, in a survey by Gordon Haskett Research Advisors:
Nearly one-third of consumers purchased groceries for online pickup or delivery in the past week – and 41% of those were doing so for the first time.
This is interesting. We’re seeing consumers who didn’t engage with “online shopping” forced to rethink how they shop for groceries.
We know today’s consumers depend on technology and expect it in every area of business and society. The grocery store is not exempt. Now, grocers depend on technology more than ever in order to stay connected and deliver meaningful customer experiences, all while minimizing risks to their customer and associate’s health and safety.
Even with consumers under “shelter-in-place” orders, it’s clear that delivery is not the silver bullet that retail expected. The incredible rise of customer pickup has been the fastest-growing model in this new environment.
This isn’t to say drop your delivery strategy; rather, re-evaluate your pickup solutions.
The Post-Pandemic World for a Grocery Store is Changing
I work in this industry, so I pay attention to consumer behaviors and how they spend their hard-earned money.
I’m saddened to see grocers, or any retailer, unable to keep up with the demand to “buy online and pick up in-store” (BOPIS). I get frustrated because I know of solutions today that increase customer throughput and improve the overall experience.
Yes, these are very unusual times; however, consumers are quickly adapting to new models. Customers can choose from a variety of ways to shop, including going to the local store and shopping in person, shopping at the local store online then choosing delivery or in-store pickup, or using an online-only grocer.
Are You Waiting to See if Delivery or Pickup Wins in the End?
In 2016, industry experts predicted that BOPIS and delivery would be the preferred way for consumers to meet their daily needs by 2033. Due to the current pandemic, we have seen an incredible increase in the adoption rate for these services, much sooner than the 2033 deadline. The big question: which method will win when the post-pandemic dust settles?
The reality? They all win!
Grocery today means being where your customer is, when they need something. That looks like a brick and mortar store, an online presence or branded mobile app, delivery through 3rd parties, BOPIS, or a buy online and pick up in-location. All these models will grow in the post-pandemic environment.
Naturally, each grocery store will determine their preferred methods for providing savings, value, and customer experience. No two approaches will be the same, but doing nothing will undoubtedly result in another retail casualty of COVID-19.
No two [grocery store models] will be the same, but doing nothing will undoubtedly result in another retail casualty of COVID-19.
Technology and Solutions are Available Today
Most news we hear lately revolves around the delivery start-up darlings. However, investments are growing in automating in-store picking and consumer-facing pickup solutions.
With services like Instacart, Shipt, Deliv, Postmates in this market, why are some delivery relationships discontinued? The answer is one we hear frequently – time is money! These delivery companies are either spending their time picking customer’s orders, or they’re forced to wait prolonged periods while their customer’s orders are prepped.
There are automated solutions that streamline the experience for the grocer, the consumer, and the delivery driver. For example, Walmart has a five portal drive-up automated pickup solution in Sherman, TX. This solution is serving over 200 online customers daily and delivers more than 1,500 of those blue totes you see the Walmart personal shoppers using.
3rd party delivery companies can use this same solution. By allowing grocers to maintain or develop picking solutions, and automate the pickup process for the consumer, this solution can eliminate the wait time for delivery companies.
There are even more innovative solutions from companies that can predict when customers are coming to pick up their order, which can enhance and speed up the pickup process even more. While pickup options and variations are rapidly growing, in-store shopping and delivery will need to continue to expand for the process to work as efficiently as possible.
The current environment serves as a reminder of how technology can help grocers thrive in a post-pandemic world. The technology is here now, a variety of solutions are here now, the chance to adapt is here, now.