Grocery Shopping Apps: The New In-store Supply Chain
It is a long time since trade journals started reporting on the imminent arrival of smart shopping carts, which would be computerized in order to give shoppers information relating to coupons, the location of items, and to speed up the purchase in general. On the retailers’ side, they would be able to generate specific data relating to individual and segments of shoppers about their buying behavior, how they navigate the store and anything else that can enhance sales.
For the task of putting shoppers into segments, grocery retail is the perfect vertical. The vast majority of us shop for groceries on a regular basis. Data collected over the course of a year can be extremely useful in building intelligent portfolios for grocery shoppers, compared to car dealerships or white goods retailers, where a years worth of data would be worthless.
Retailers have conducted experiments with computerized shopping carts, otherwise known as “smart carts,” although no one has adopted them yet. This may be due to the narrow margins in the industry.
However, the ascension of the smart phone has given retailers the opportunity to develop apps that can do everything the smart cart was supposed to do. Information provided by Digitas Connected Commerce suggests that 92 million American shoppers use a smartphone app while shopping for their groceries.
The most prominent of these to be developed so far has been developed by inMarket, which is directed at retailers. It supports things such as shopping lists, loyalty rewards and a promise of an increase in strategic marketing budgets for retailers. Case studies conducted by brand owners suggest that, in some cases, a 300% purchase intent lift has been experienced when the app is used to promote a product as the shopper approaches the SKU in store.
The challenge is for the supply chain to support these developments, and here’s what must be done:
Firstly, promotions must be connected to shopper segmentation. Having a years’ worth of data means that the retail chain should be able to understand the shoppers’ situation accurately and respond to it.
Second, in-store apps provide the opportunity to clear the inventory and for trade promotion spending to be better directed by the marketing department.
The third and final action relates to budget shoppers, whose shopping habits must not be allowed to affect the sales of other items in the shop. The data must be used to decipher which shoppers to target.
Promotions have long been a pain for supply chain organization, but new techniques have helped to improve the situation. Enhanced segmentation data has provided the possibility of better planning at retail outlets and therefore, allows brand owners to manage their inventory more efficiently. And where problems do arise, there are now better solutions that can be implemented.