Summary:
Kroger, Walmart, and Target’s omnichannel methods are pulled directly from the Alibaba founder’s “New Retail” supermarkets in China. This fully integrates online and offline channels of grocery shopping together with services like same-day delivery and the use of QR codes. This started with Amazon’s influx of technology into Whole Foods after purchase back in 2017 and soon after spread to Walmart and Target.
New omnichannel methods include “automated fulfillment centers bag groceries; vans make same-day deliveries to households; data analytics provide an early read on customer trends; mobile apps distribute customer promotions and coupons; on-premise “ghost kitchens” prepare meals for in-store pickup or van delivery; QR codes handle payments online at self check-outs; and large online fulfillment centers and warehouses rely on robots for packing, sorting and loading orders.” These automated fulfillment centers move workers to handling engineering and inventory management.
Covid lockdown helped Kroger’s digital business grow by 113% at over $10 billion in revenue a year in the last two years. They hope to double this by the end of 2023. Last year, digital and in-store sales combined grew over 5% while this year digital sales alone grew 8%.
These omnichannel methods are changing the way Kroger’s customers behave as its bringing in new business in some places while almost completely forgoing in-store shopping in others. Part of this change also has to do with Kroger’s stake in the U.K.’s grocery e-commerce company Ocado Group. This partnership brought their home delivery platform to the United States in centers near Cincinnati, Atlanta, Orlando, Dallas, and Wisconsin with several more planned.
The United States was behind in grocer e-commerce but Covid forced the U.S. to catch up.
Analysis:
Not integrating technology into the in-store shopper experience is being blind to how the world is developing. This is even seen happening in small local markets. Covid may have been the big push to get e-commerce in grocery really rolling but it is not the end of it either which is shown in how last year digital sale growth alone was more than digital and in-store sale growths combined the previous year. Omnichannel methods being refined and added to is only going to strengthen “New Retail” and enhance the experience for the shopper whether they are a customer or hired gig worker.
Us being caught up is nice and hopefully it stays that way (or we even get ahead of the trends), but that is not promising considering every aspect of “New Retail” and these omnichannel methods is basically copied and pasted from Jack Ma, Alibaba’s founder.
Source:
Publisher: CNBC
Author: Rebecca Fannin
Date: September 25, 2022
