The Future In-Store Experience for Grocery
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Over the last year, many companies have been forced to make a push into digital while others were already ahead of the game and have done well over the last year. For some the transition to digital is easier than others. It is not unheard of for QSR restaurants to average above 50 percent of their orders from digital channels, while others like grocery are considerably less. However, it is expected that US grocery e-commerce sales will increase by 17.8 percent year over year in 2021, meaning that digital grocery shoppers will buy about 11 percent more than they did in 2020. This growth will occur despite the average consumer having fewer anxieties about their health as the pandemic gets under control later this year. (Source: eMarketer)
While e-commerce shopping has grown, the in-store experience for grocery is still behind. Today there are still physical people shopping for your groceries, just as you would do walking down every aisle. In the QSR space we see new store layouts with dedicated make lines or kitchens for digital orders. We also see full ghost kitchens where normal customers can't even come to pick up an order -- they only offer delivery. So what is next for the grocery experience?
Here are a few trends we believe will continue to gain traction.
E-commerce isn't going anywhere. The ability to shop online and just pull up and get the groceries delivered into your truck or delivered to your home can save a ton of time and hassle. This is especially true for those who have children or those who are not physically able to walk around a giant grocery store. The biggest customer friction point here is the first order -- it can take just as long to shop online for groceries as it does to actually go into the store. It's not until you have your first order history that the experience can be made simpler.
The natural extension of e-commerce is picking up your orders in a convenient manner. Most of what we see out there today is an add on to an existing store design, where it's not convenient to the employees to drag your order from inside the store all the way out to your vehicle in all sorts of weather. In the QSR space we see a ton of innovation coming from new store concepts focusing heavily on drive through adding two and three lanes and more efficient order ahead areas. One company that is making huge changes to store layout and operations is takeoff. They are working to help grocers automate the picking of e-commerce orders.
Scan and go
For those who still like to go in and shop, there is a rise of scan and go experiences. This helps cut out the checkout lines, but after COVID-19 a majority of stores have streamlined the checkout experience where you never pick the wrong line again. However, the other benefit of scan and go is that it frees up more store employees to help out in other departments like collecting online orders. Scan and go is almost essential for the employees picking these online orders since there has to be a way to check off the customers order and make sure it is paid for and gets out the door.
We can expect to see new innovations in the grocery space in the coming years. New store layouts to entirely new concepts. All of which will be driven by new technology on the backend. We also see automation innovation in the supply chain, from driverless trucks to robots who can pack and unpack warehouses. We believe that a balance of automation and personalization is the key to a great customer experience in or out of the store.