Today on the Menu:
How the user experience on the web is changing bricks-and-mortar retail
by Arno van Ruymbeke, Business Development Manager
The digitization of processes, e-commerce offerings and the introduction of blockchains in food or soft retail have been on the rise for some time. But what’s new is the next generation of technology focusing on the users or buyers in store.
Among other things, because there are more technologies that support the analysis of behaviour in the market. Multivariate A/B tests, which are known from the development of customer-friendly websites, can now be carried out at any time in the store via digital signage solutions or electronic price tags. Heatmap analysis and AI-supported camera systems provide further possibilities to gain a better overview of user behaviour and preferences.
More transparency on the supermarket shelf as a basis for purchasing decisions
These changes are driven by the market, i.e. consumers. Behavioural patterns such as "research online, purchase offline" (ROPO) and price comparisons, the search for background information or tutorials and user-friendly ordering processes in apps have been learned, accepted and are now expectations (partly still unconsciously) of the retail trade.
In connection with an increased distrust of information due to fake news, moving forward technologies such as blockchain will be of particular importance in building trust with consumers. In addition, not only the information but also nutritional behaviour of customers has changed sustainably. Conscious nutrition is now a fact for half of Germans. So much so that they are willing to accept even higher prices. For this part of the population, the following applies: The diet becomes health-conscious, it is oriented towards animal welfare or is shaped by cultural or value-oriented decisions. The same pattern follows for targeted reduction of alcohol, lactose, gluten or meat.
Expand service offerings and retain customers with electronic price tags
Now the technology comes into play – right on the shelf, where it is most effective. One of the reasons for this is electronic price tags. There are also some technical innovations here: With the help of significantly better labelling options on the shelf, e.g. more colours per price tag, the increasing connection of online offers via QR codes or Near Field Communication (NFC), it is possible to link cooking blogs in the supermarket, how-to YouTube videos in the DIY store or fashion tips on Instagram directly to the product on the shelf.
There is also further potential for retailers when it comes to negotiations with manufacturers: If retailers can offer manufacturers more transparency about their products, this can in turn become an advantage in the discussion about listings and placements. The time factor is becoming increasingly relevant. In addition to seasonal effects, short-term peaks - in the food sector also triggered by influencer marketing - are playing an increasingly important role.
The turnover of the food industry in Germany last year was 186.25 billion euros – a literally billion-euro business. Retailers have an important role to play, which must be performed responsibly in order not to lose consumer confidence. In the past, journalists performed a gatekeeper function by evaluating products and evaluating information, e.g. from press releases. If retailers also want to act ethically, the interest must be in offering food information as simply and transparently as possible. Because in addition to the positive trend of conscious nutrition, there is also the opposite movement.
According to the BMEL nutrition report, the number of people who cook daily in Germany has risen from 41 percent to 46 percent since 2016. On the other hand, the number of people who do not cook at all has also grown slightly – from 10 percent to 12 percent. The easier it is to cook and provide information about the ingredients, the more likely it is that you can promote the first trend and reduce the second.
Another function of the latest generation of price tags is currently still little used but can potentially play a decisive role – especially in combination with other technologies. The next generation of conventional electronic price tags has so-called »pick-by-light« functions. The customer orders via the app, in the store the order is made available for them to pick up in a compact and central location or sent home. Packing in the store is facilitated by small LED lamps that automatically indicate where the goods on the shelf that belong to the order are – in other words, "pick-by-light". Since the LED lamps can flash in several colours, parallel processing of Pick & Collect orders is possible. Smart Locker systems that can maintain certain temperature levels such as frozen food or heat counters also open up completely new possibilities.
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