Tomorrow’s grocery shopping

Grocery shopping has undergone deep changes over the last 100 years and, like anything else, it will do the same in the future. The current Covid-19 pandemic is contributing to this evolution. Regardless of whether it will be over soon or not, one thing is sure: it has forced us to make adjustments and in a way, the virus has just accelerated changes that were already in the works. Here is how I see what to expect.

First of all, Covid-19 has changed how we live, and therefore how we shop. Online retail was growing but then it became almost a necessity for grocery stores to jump on board and engage in online sales. It was not always smooth. It took time for many outlets to organize taking orders, preparing them and get the orders ready for pick-up or for delivery. There was a lack of staff. The staff was not trained properly and there were all sorts of logistics issues to fix. Without getting in details, stores have been able to get a better presence online and ensured a better and smoother service over time, and rightly so, because many people have discovered the convenience of shopping at the time of their choice, not having to drive to the store, not having to be in the herd, which was already a pain in the neck before the pandemic, and not having to wait in line to check out. It saves them time and stress. These are the main reasons why I expect online grocery sales to stay and grow further. The offering and the navigability of online stores will have to improve as for now, it is still a tedious experience. The execution of orders is still a challenging area. More staff is needed and at the moment, this part of the business is the busiest and currently the largest employment opportunity at Wal-Mart. Amazon has also hired large numbers of new staff. Yes, it takes time and manpower to fill orders. It is nothing new. I used to do that part at my parents butcher’s shop. I used to prepare orders and deliver them to the customers who required it. Of course, my parents’ store was a relatively small operation and our phone and my brain (and my legs and arms, too) were all it took to get things done. The volume of business of modern grocery store is such that it could just be a family thing. My point is that preparing orders and executing them is nothing new and actually not all that complicated, and it is a pillar of good customer care.

Here is where I see more changes in the future. Having to manage so many new people to fill order –or to be personal shoppers to put it in fancier words- is a complex task. Such staff is usually paid little, not particularly motivated and always looking for better job opportunities, not to mention they can get sick or absent. Of course, the numbers and he economics will have to adapt, but I believe that in the future, order filling staff will be replaced by robots, connected to order software. The robots will manage orders, prepare and pack them. There are already robot waiters in some restaurants, so it is not so far-fetched. The robots also will be connected with the warehouse and the inventory management software. They will re-order for the warehouse, ensure first in first out, eliminate loss and waste and know exactly where to pick what and complete the entire job much more efficiently than humans and that on a 24/7 basis, and not require being unionized. I believe that corporations will like that.

Another area where I see potential for change is the sharing of online platforms. French retailer Carrefour offered that possibility to small retailers who had to close because of the Covid -19 lockdown in France. Thus, small stores did not have to venture and spend on developing their own online presence, which could have been challenging, not to mention stressful considering the circumstances. Further, cashing in fees for a online platform can be a business, too. What Carrefour offered is in fact the same as large online retailers like Amazon and Alibaba have done for independent sellers for years now. It is also not all that different from an EBay type of concept. Sharing of online platform will be a way of making the jump for small stores and from, there they will decide whether to keep using such platforms or build their own.

Order pick-up will certainly be a solution of choice for quite some time. Home delivery will have to evolve further, simply because it can be costly, except for outlets that can offer free deliveries for a minimum purchase amount, which is already the case. Deliveries might also be carried out by driverless vehicles in the future, such as Kroger has been testing for some time. Of course, there is always the possibility for restaurant delivery organizations to make the move to help retailers. After all, many of them want to be listed on the stock market and that will mean the necessity for them to keep growing always more and that will mean going beyond restaurants as per today. Here, the key will be to drop their fees. What these organizations charge for meal deliveries is rather brutal for pop-and mom restaurants and volume will have to take over fee based on bill percentage.

Retail will evolve further and there is no shortage of possibilities. Although everyone claims to collect data and know their customers, I think that it is more something in the realm of talk than actual effective execution. I have loyalty cards but I never get any shopping advice. My shopping news is either through the generic flyer that I find in my mail box like all other shoppers. And if I take a look online to see what is attractive, I have the exact same online flyer, as the paper one, with absolutely nothing specific or special about my own particular needs. I thought they would know what I buy and don’t buy and help me accordingly, but no, none of that ever happens and I do not have the feeling that is in the works. Hello, retailers! One the most daunting thing that shoppers go through is to make the bloody weekly shopping list. What do we need? What are we going to eat? What do they have on ad for us? Should we buy at retailer A or retailer B? No answer to any of that ever comes my way. If your retailer sends you personal shopping lists and tips, specific nutrition and menu tips you are lucky, and I am not. But I doubt it because I have never met anyone who did get of shopping tips. Retailers like Amazon do give some shopping tips and online ads also appear when I browse on Internet, but as far as I am concerned, they tend to miss the mark about every time. Perhaps, my being a frugal person makes me one of those difficult individuals to influence and to get to buy stuff but I really think that shopping tips should be a lot more on target than they are. I also believe that to improve this situation, it would be much better to have a voluntary and active participation from the shoppers themselves by having them giving more inputs about their needs and wants, although this of course enters the slippery area of online privacy, but you aill have to admit that it is a lot easier to serve customers well when they are in a position of telling you what they are exactly looking for. And in these times of “Internet of Things” why not combine store information with producer information and process it in a virtual production information and shopping advice system where people can make choices based on their values, their needs and all relevant information they need to make their decision, in a totally transparent manner? With such a system, why not even include a virtual tour of farms and packing facilities and show people where their food comes from and how it is produced and by whom? It could be accessible at home, could make use of VR helmet and could be consulted at a convenient time, not in the stressful rush of the in-store shopping with others breathing in their necks, especially if shoppers do not wish to go inside the store again.

Yet, as I show in this picture below, data servers and supermarket aisles look surprisingly similar. Every purchase and consumption is a transaction that goes way beyond money and product. It is a transaction between data – and therefore lifestyle choice, personal choices and values – versus the price shoppers pay. Why not include it in the shipping experience, then? I believe the answer is in the area of business thinking. In spite of the many claims, it is still a primarily production-driven, volume-driven cost-obsessed model, and not enough of a service-minded customer-oriented value-obsessed model. Of course, there is no reason why this would not change and anyway, the former model I mention is pushing for some positive innovations, such as cashierless stores where you can come in buy and leave without going through the tedious checkout lines or the even so much more fun do-it-yourself checkout where half the people I see seem helplessly stuck unable to figure out which button to press.

With what I just described, one could easily wonder why to have large supermarkets anymore. Why should the corporation spend all that money in prime –therefore expensive- locations, with fancy stores with light and all sorts of amenities, while in the future, most of the shopping might actually be just a warehouse order filling activity. This is an even more relevant question for staple foods and undifferentiated commodities? Since commodities are really mostly about low cost, then retailers keep your costs down and focus on specialties and value for the store experience. I see several areas for which this would make sense. Non-perishables should be in the warehouse and not take much space in the shopping area real estate. But perishables are another game. First, they are perishable products and they have to receive special care to avoid loss and waste. Second, people like to use their senses to purchase perishables. They like to touch them, to see them and inspect them, and to smell them. Perishable shopping is still a highly sensory activity, and it quite personal. Some people like their meat lean and others prefer a marbled one. People like to take a look at the produce to make sure it is not damaged, bruised or blemished or that it is ripe. They like to make sure it is fresh. Some people like baked goods to be well-baked and others prefer when it is on the paler side. Color is an important factor. For all these reasons, leaving the choice to underpaid staff who do not know the customers and do not care overly for them is quite a bit risky in terms of customer satisfaction, and I am not even talking about cases of mistakes such as delivering bacon instead of the ordered pork tenderloin I heard of at the beginning of the pandemic and the early times of packing orders for curbside pick-up. No, perishables will require special attention and my guess is that personal service will be high on the list.

When it comes to produce, I expect another evolution. Produce is delicate and with too high waste along the supply chain and in the store. Local production may have its advantages in term of sustainability, in particular when it involves truck road transport, but it makes a lot of sense about freshness and waste reduction. Just like the fruit and veggies that I get from my garden, picking fresh ripe produce just on time makes a world of difference. Just ask my wife about how it tastes compared with what we used to buy from thousands of kilometers away. In such a quality approach of perishable retail, why not get them locally. Urbanisation push produce farmers further way and yet, there is an amazing acreage that can be used to grow produce in cities, and interestingly enough a lot of that acreage is on top of supermarket, malls and warehouses. So why not build greenhouses on top of the store and sell the produce superfresh downstairs?

If you have to point of sale, it is much easier than being an urban farmer looking for customers. The store is there, people come to buy all sorts of things, just add the produce from the roof farm. Actually that is what a number of retailers have already started. France’s Carrefour, again, is one of them, but Benelux’s Ahold Delhaize has been working on the same thing and I am sure other will come and offer freshly picked local (roof) lettuce, leafy greens and tomatoes and strawberries.

Quality of products and quality of service will be the top demands and the old concept of small butcher, baker, greengrocer store will be the answer, although with a modern touch and with help of technology. I expect future supermarkets to be just that. They will be markets, like in the old days and they will be super, as they will wow their customers with prime shopping environment, prime products and prime personal service. A side advantage of this will also be that it reduces the use of packaging and has the potential to require no plastic whatsoever. After all, the purpose of plastic packaging has been to replace human labour by allowing self-service.

Copyright 2021 – Christophe Pelletier – The Happy Future Group Consulting Ltd.

What do consumers really want to know about food?

My previous article about what consumers know about food is only part of the equation. What is as important is to know what they want to know and why. When it comes to knowledge of food, consumers can be divided into three main groups. There are those who know about food and most are always interested to learn more. Then, there is the (large) group of people who do not know. Some are willing to learn. Usually, they are confused by all the contradictory points of views that they hear or read and they just do not know who they should believe. This open-minded sub-group gathers people from all walks of life. They may have their biases but they are willing to change their minds. Another sub-group among those who do not know much about food gathers people who do not know and do not care as long as their food is safe, tastes good to them and has the right price. Then there is the third group, the difficult group of those who think they know but don’t. Usually, they are not willing to learn because, well, they already know it all and they are certainly not looking forward to have their certainties challenged. This group can be divided into two sub-groups, too: those who think they have the monopoly of science and those who think they have the monopoly of morals.

In this article, I will focus on the people who have the willingness to learn about food. What would be the point of trying to spend time if that willingness was not there? Also, all I can tell is my personal experience when meeting with people who are asking questions about food and where it is all going. Actually, I always found that the conversations I have had with people asking me about food and agriculture went quite well. I guess the secret for that is to not try to force people into any conclusion. Let them decide for themselves. People do not like being told what they should know and believe. It is a very normal reaction, and that is why so-called “educating” the consumer will never really achieve much. Just have a relaxed talk without any particular agenda other than to listen and respect each other’s point of view.

Further, even though marketing experts always like to define specific areas of attention, the mapping of consumers is not all that useful when it comes to the food conversation. Of course people are concerned about health, environment, origin of product, production methods, etc… When you look at what consumers want to know, it really comes down to two main issues. One is “How do I know that my food won’t make me sick -or worse?”, and the other one is “Can I trust the food producer?” These two issues are quite interconnected and not easy to address for food suppliers. The first issue, which really comes down to the topic of food safety is work in progress. There has never been full absolute food safety in the past and it will not be possible to guarantee that in the future, either. A large part of food safety issues actually happen in the consumers’ homes because of poor food handling. Many consumers do not know the basics of proper food handling. But even at the producer’s level, no production system is immune. Problems happen just as well with industrial production as with farmers’ market type of food. It happens with large producers just as it happens with small producers. This is where the issue of trust plays an important role. Consumers want to know which suppliers they can trust for food that does not contain anything harmful or/and weird. In previous posts, I have raised the issue of trust many times and mentioned how difficult it is to earn. Why do some food producers earn trust and others not? It has been the idea of brands since day one: the consumer can recognize the producer easily and know that the product is reliable every time. In our world flooded with information, rumours and stories of all sorts, and with a reach like never before, this is not sufficient anymore. If the question of how to earn trust is often difficult to answer, another way of looking at it is to do what I like to do when I cannot get an answer: to look at it from the opposite angle. The question then becomes what makes consumers not trust a producer? I am sure that you can make a list of reasons very quickly. Here I can give you a few: not knowing the producer, bad or unknown reputation, unreliable quality, regular problems, hiding information, not answering questions, lying to the customer, saying one thing and doing another, etc… It has a lot to do with quality of the product and quality of the communication, and consumers want to know what the quality of both is.

Traceability and transparency address those concerns to some extent. They are certainly helping by creating a much required communication and openness. However, the question remains whether food suppliers are on the same wave length as what consumers want to know. Traceability and transparency are not new concepts. They were part of my dealings with my customers some 25 years ago, and I still have the same reservations today as I had by then. I can state without any doubt that traceability is essential but I would like to see it become a proactive tool, instead of about just recording history. I remember telling one of my customers by then that I thought that traceability in order to be able to explain on rather short notice what went wrong was really short changing the customer. With today’s mass digitalization, which makes getting the information about the records even quicker, I believe that my point has become even more important. Traceability cannot just be about finding out the cause of a problem after the customer has found out. I always have considered that the customer can never be the quality control of a supplier. If producers have traceability systems that allow them to tell within moments what went wrong, then the system has to be able to prevent the problem from happening. The traceability system has to be connected with the quality assurance system. With the rise of sensors, internet of things, data collection software and artificial intelligence, the traceability system must become the frame for quality assurance and the high-tech devices will have to allow a real time 100% quality control on physical, chemical and biological quality criteria. It will have to be able to shut down the production line as soon as a deviation from the quality standard occurs. Traceability will move from “writing history” to “making (clean) history”. There are already a lot of possible quality defects that are prevented from being sent to consumers but it has to be even better in the future. Ideally, the objective must become zero recall, because even if recalls help prevent problems from getting worse, their incidence is creating a feeling of insufficient safety.

Regarding transparency, I believe that there is a disconnect between what food producers are doing and what consumers are looking for. Of course, the best way to be fully transparent is to put every bit of data and information in the system. From a consumer’s point of view, what is transparency really about? Do you know anyone who wants to check every detail of the production of what s/he buys? Consumers might be interested to know from which farm their food comes from. They might be interested in knowing the farmer’s name and see pictures. Will they want to be interested in digging as far as to know when chickens were born and when, what feeds they ate during their life and where the feeds came from and what they were made of and where the ingredients used for the feed came from and when they were produced, or would they really be interested in knowing the genealogy of the chickens and look up for where the parents and grandparents were raised, or have the production details in the slaughterhouse? I doubt it. In my opinion, the highest value of transparency for consumers is that the food producer has it and is willing to show everything if questions arise. In other words, the producer is not trying to hide or misrepresent anything.  After all transparent means exactly that: you can see for yourself through the window and you do it without having someone telling you what and where to look. More than the content of information presented, it is the food producer’s attitude that matters. The role of social media also amplifies the need for transparency, but it also may contain some pitfalls for producers. A recent survey by Deloitte shows that Millennials and GenZ assess producers by their values a lot and that their loyalty will be to the values and not to the brand. I believe that values are going to be a critical aspect of how consumers choose from whom they will buy their food, and anything else. The combination of social media with heightened sense of individualism (some would say narcissism) and yet at the same time a strong trend towards polarization and tribalism around sets of values and beliefs means that food producers will have to navigate skillfully in the future.

Copyright 2019 – Christophe Pelletier – The Happy Future Group Consulting Ltd.

Transparency is a market-driven exercise

Among all the trends in food markets, transparency is a tough demand to meet. As such, it is only natural that consumers have questions about what they buy and want to be sure that they buy something they feel comfortable with. In times when the food economy was local with everyone knowing each other in small communities, the food supply chain seemed transparent. With the separation of rural areas and urban centres and the increasing distance, both geographical and relational, between consumers and the different links of the chain, the distance in trust increased, too. Add to this a few scandals through the years and the result is a feeling that something is broken in the world of food.

The renewed desire for transparency is nothing than a cry for trust. Since the personal relationship with suppliers in many cases no longer exists, trust cannot be just a matter of knowing the farmer, the baker or the miller. Today’s transparency is about verifiable facts. Today’s consumers, unlike their parents or grandparents, do not want to be told a story anymore. If they don’t trust you, they won’t believe you anyway. They are used to search online for everything, with more or less success when it comes to the truth, but they nonetheless want to find out for themselves and figure out on their own what to think. Today’s concept of transparency is replacing PR, which is a one-way push communication technique. Today’s consumers want a one-way pull information platform. That is all the difference. PR is obsolete, but most food producers still have not come to this realization.

The prospect of having to collect, update and disclose all information through the chain from DNA to retail store or restaurant seems a daunting task and for many food producers, it feels like an overwhelming request. It seems and feels that way because it is. It is rather close to some Herculean task. One of the questions I often get is how much do consumers want to know and should everything be available? My answer is that in theory, consumers want to know everything and so it all should be available indeed but in practice, it is somewhat different. Consumers do not really want to know everything about how their food is produced. Well, maybe some do but they are very few. Most consumers do not even read nutritional labels, so they won’t bother spending hours or more to learn everything about the bread or the chicken they just bought unless something serious triggers it. So, what do the large majority of consumers really want? They don’t want to know everything but they want you to be able to answer them any question they have. They want the certainty that, should they have a question about their food, they will get an answer, the truth and that nothing will be hidden from them. Transparency is much more about trust and truth than it is about hard data. Yet, the way to get there is through data and open access.

TransparencyThe amount of data that can be collected is huge and so is the task to set up your transparency system. However, regardless of how much data you collect and share, your transparency performance will always depend first on making transparency one of the pillars of your organization. By that, I mean have the genuine willingness to engage in a candid and honest interaction with your customers and consumers. Genuine, candid and honest are key words when it comes to transparency. People will sense if you are so indeed. If they sense the opposite, you will not gain trust and the perception of your company will further deteriorate. Consumers will forgive honest mistakes when you admit you made one and are willing to do what is needed to correct it, both inside your organization as towards your customers. Consumers will accept that you do not necessarily have all the answers ready but that you are willing to do the research and come back diligently to them with the information. Although immediate response has become an expectation in the digital world, people understand that sometimes a bit of time is needed. Although data is important for transparency, attitude is at least just as much. By being responsive and handling difficult conversations in a mature manner will get you a long way. In a transparency approach, there is no need for defensiveness. You open the doors and you get out of the way! Of course, the mix of transparency and data brings the issue of boundaries. There is a fine line between what is useful information for customers and what is critical information about the company and information that affect competitiveness. Consumers will understand that some information is sensitive enough to not be disclosed. In this process, too, it is essential to be genuine, candid and transparent as long as it is not an attempt to hide something. Remember, transparency is a tool to increase the consumer’s trust and loyalty!

Copyright 2016 – Christophe Pelletier – The Happy Future Group Consulting Ltd.