“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness…”
Charles Dickens wasn’t talking about grocery retail in the digital age when he wrote that opening line in A Tale of Two Cities, but he could have been.
What do SAP Hybris experts have to say about the digitization of grocery? I caught up with John McCoy, digital industry advisor and Stephanie Waters, retail industry principal.
Behind the trend, then a game of catch-up
John noted that over the last few years, there’s been an interdepartmental battle of sorts within companies between e-commerce and the rest of the divisions over the concept that the digital consumer is just as important as the in-store consumer, and will be increasingly important in the future. Now he finds that the organizations that failed to accept or adapt to e-commerce as a trend early enough are scrambling to survive.
In a frenzy to catch up, many brands are quickly trying to add services like online shopping, in-store-pick-up, and home delivery; some by partnering with third-party apps simply to say that they offer the service. The catch? They aren’t really thinking about the consumer’s best interest; they aren’t creating high-value moments with customers, and when they don’t do that, they aren’t any closer to their customer than they were beforehand.
Saying it again for the folks in the back: If you’re adding services but not focusing on experiences, you stand to lose, instead of gaining or retaining, customers.
Stephanie and John are retail experts, but they are first and foremost consumers. As they compared their true stories of experiences with two different retailers, few would have predicted the ending.
High-end supermarket vs. everyday low price retailer: A plot twist
Stephanie has been a lifelong, enthusiastic customer of a high-end supermarket, and she was ecstatic when the store finally began offering home delivery in her neighborhood. She went online expecting an outstanding customer experience. Instead, she went from loyal consumer to lost customer in a matter of a single online journey.
John, on the other hand, fervently believed that he would never use one particular low-price retailer. In fact, he’d spent most of his life rabidly opposed to it, until he and his wife began to research grocery options in their city. Reluctantly, he decided to give it a try. Today John’s family spends over 90% of their food budget with that retailer.
The differences between their experiences couldn’t have been more stark, and it all came down to a key point: One retailer offered “check the box” services but a poor customer experience, while the other looked at the customer with a 360-degree lens and used the data to engage and delight.
A revolutionary change: Retail is swept up in the tide
So what did these grocery retailers get so right and so wrong? Here’s a juxtaposition of the two experiences:
Stephanie: When she went online to place her first order with her supermarket’s delivery partner, she started to look for her favorite items, which required her to scroll through hundreds of products listed in random order to find what she needed.
Then, as she began to fill her cart, she realized that the prices were significantly higher (15-30%) than in-store. On top of that, she discovered that while the supermarket offered free delivery on her first order, there was a service charge, and she’d still have to tip the driver.
She would have abandoned the order at that point, but decided to continue with the process for research purposes. She was further stunned when the store asked her to sign up for a $149 subscription for a year of “free delivery” after she completed her order. “I won’t be using that service again,” said Stephanie. “Fortunately, more and more online grocery options are being offered in my area. I’m confident I can find one that offers a great user experience at a reasonable price point.”
John: As John began to interact with the retailer, his surprises were both pleasant and radical. How radical? Beyond now spending 90% of his grocery budget on a brand he’d previously never spent a dime on, he said that the experience has “literally changed our lives and given us back more time—probably about four hours per week.”
He noted that if the retailer is out of a product, it always substitutes up, never down, and the employee who greets him when he stops to pick up his grocery offers him free samples of products that he and his family might like, based on their grocery lists—which they in turn purchase in the future. He even noted that when a particular employee is off for the day, they are sad not to see him.
Imagine gaining not just a customer, but a loyal customer who touts the praises of your brand to all of their neighbors, who also begin using the brand.
Imagine losing a customer—not just any customer, but a lifelong loyal customer who now expresses genuine sorrow and frustration when talking about your brand.
That’s the new reality of shopping in the digital age. The key difference is that one brand retained and used customer data to provide outstanding experiences for its customers every single time that it engaged with them, while the other served up a lackluster, much more expensive option without ever following up or realizing that their customer was gone.
That’s the world we live in now.
For more insight on how data can help your company boost customer engagement, see Customer Contact: The Enduring Power Of ‘I Get You’.