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© IGD 2015Stewart Samuel, Program Director, IGD Canada
© IGD 2015
Who are IGD?
• We are food and grocery industry experts• 800 members globally from the consumer goods industry• IGD is inclusive and works across the whole supply chain
Source: IGD Research
Future Proofing & Innovation
Retail & Channel Strategies
Commercial & Category Excellence
Efficient & Sustainable Supply Chains
© IGD 2015
Aims of today
• To demonstrate that the supermarket is the lifeblood of the grocery sector but is need of reinvention
• To generate discussion around the impact of new retailing models
• To provide inspiration for some new ideas that you can take back into your business
Source: IGD Research
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© IGD 2015
© IGD 2015
Where is the growth globally?
Source: IGD Research
© IGD 2015
The supermarket is being reinvented
Source: IGD Research
Store design to delight and inspire
Integrating online into the store
Embedding digital into the journey
Step‐change with foodservice
Health and wellness
destinations
Making value more effective
© IGD 2015
1. Store design to delight and inspire
© IGD 2015
Investing in the environment
Source: IGD Research
GREAT Food hall, Hong Kong
Spar, BudapestLa Grande Epicerie de Paris
© IGD 2015Source: Kochhaus, Germany
Providing shoppers with inspiration
© IGD 2015
Putting fresh at the heart of the offer
© IGD 2015
Opportunity to be innovative
© IGD 2015
Showcasing fresh credentials
Source: IGD Research
Specialist counters with adjoining seating
Greater production on the shop floor
Shopper focused layout
Locally focused, premium quality ranges
Helping shoppers buy with the season
Boosting personality and localness
© IGD 2015
Canadian retailers have been on the front‐footCanadian retailers have been on the front foot
© IGD 2015
Action points
• Increasing frequency of store re‐models and refreshes is likely to be required to keep meeting shoppers’ expectations and maintaining loyalty. What programs do you have in place?
• Don’t neglect the centre store – how can you apply learnings from fresh foods to make key categories destinations in their own right?
Source: IGD Research
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© IGD 2015
Confectionery champions: RT Mart, China
• Source: IGD Research
Source: IGD Research
Chocolate Town concept gives the category clear and characterful identity
Flashing lights installed in the shelves help catch shoppers’ attention
Floor‐to‐ceiling displays have high impact and great visibility throughout the store
© IGD 2015
Action points
• Increasing frequency of store re‐models and refreshes is likely to be required to keep meeting shoppers’ expectations and maintaining loyalty. What programs do you have in place?
• Don’t neglect the centre store – how can you apply learnings from fresh foods to make key categories destinations in their own right?
• Tailor store layouts to maximise convenience and time‐saving for shoppers; pull them through the store with excitement rather than out of necessity
Source: IGD Research
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© IGD 2015
Tesco: assisting shoppers with speedy shopping
Source: IGD Research
‘On the go’ is positioned by the entrance to ensure it is easy to locate and quick to buy
Milk is a top distress purchase. Many of the stores have a milk fridge at the store entrance to facilitate this shopper mission
Non‐food positioned towards the back of the store, ensuring food only shoppers do not have to navigate through it
© IGD 2015
2. Integrating online into the store
© IGD 2015
Grocery ecommerce gaining momentum
Auchan, Roissy Aeroville, FranceAsda, Grantham, UK
© IGD 2015
Loblaw
Source: IGD Research
Click & Collect set to be the dominant model here
© IGD 2015
There is no “one size fits all” model
Source: IGD Research
Order online, collect at store
Order in‐store, delivered to home
Order online, collect at service point
Order online, delivered to home
Picked at dark store
Picked at dedicated DC
Separate picking‐ integrated in‐ store
Pickedin‐store
For shoppers
For retailers
Order on the go, collect anywhere
Direct delivered by manufacturer (marketplace)
© IGD 2015
Tests, pilots and roll‐outs
Source: IGD Research
© IGD 2015
Shoppers want flexibility for store pick‐up
1. Supermarket carparks 46%
2. Work places / business parks 35%
3. C‐store lockers 34%
10. More/better evening meal deal offers
32%
5. Out‐of‐town retail parks 32%
6. Park and ride locations
23%
7. Railway stations 22%
8. Gas stations 22%4. Holiday locations
Source: ShopperVista Online Channel Focus, past month online grocery shoppers, Nov‐Jan’15
© IGD 2015
What’s coming next
Source: IGD Research
© IGD 2015
The value of multi‐channel
Source: Ahold
© IGD 2015
Action points
• Convenience is the primary drive for online grocery shopping; any solution has to save time
Source: IGD Research
1
© IGD 2015Source: IGD ShopperVista, Jan 2015
Convenience is the main reason for shopping online
85%
61%
45%
19%
11%
19%
62%
11%
13%
4%
2%
7%
Main reason All reasons
1It’s easier or more
convenient
2 It’s quicker
3 It helps me save money
4 It’s more enjoyable
5It’s better for the
environment
6 Other
For food and groceries
“Avoids carrying heavybags”
“If the weather is bad”
“Don’t have access to a car”
“Avoids going to the store”
“Checkout is quicker”
© IGD 2015
Action points
• Convenience is the primary drive for online grocery shopping; any solution has to save time
• Online grocery shopping drives price transparency making it easier for shoppers to make comparisons
Source: IGD Research
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© IGD 2015
Saving money is also important
“I buy less on impulse”
“It’s easier to stick to a set budget”
“It’s easier to compare prices”
IGD ShopperVista Channel Focus, past month online shoppers Feb‐Apr 2014
45%
% who say SAVING MONEY is one of the main reasons they shop
online
© IGD 2015
Action points
• Convenience is the primary drive for online grocery shopping; any solution has to save time
• Online grocery shopping drives price transparency making it easier for shoppers to make comparisons
• As the channel starts to evolve and grow, suppliers need to consider resources and structure to support; it’s a small part of the market but may need your best people on the account
Source: IGD Research
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© IGD 2015
Learn from the Leaders
Dedicated resource
Channel strategy for online
Understand online dynamics
Drive inspiration initiatives
Work jointly with retailers to improve / innovate
Source: IGD Online Capability Survey 2014
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© IGD 2015
Embedding digital into the shopper journey
© IGD 2015
Mobile technology is a key enabler
Source: IGD Research
Carrefour Villeneuve‐la‐Garenne, France
ICA Maxi Haninge, SwedenWalgreens, USA
© IGD 2015
Towards a digital future: Waitrose, UK
Source: IGD Research
Welcome desks enabling online access
iBeacons to direct customers around the aisles and notify them of offers based on shopping habits
Order a juice for when you arrive in the store
Get assistance from staff with your smartphone
© IGD 2015
Gamification adds element of fun
© IGD 2015
Technology can speed up the shopper journey
© IGD 2015
Make the journey faster for your shoppers
Source: IGD Research
Tesco Extra, Lincoln, UK
Pingo Doce, Lisbon, Portugal
© IGD 2015
Alternative payment points
Source: IGD Research
Albert Heijn to Go, Amsterdam.Tesco Express, Philpot Lane, London
© IGD 2015
Mobile is key enabler
Source: IGD Research
© IGD 2015
Action points
• The smartphone has become the remote control of consumption; basic requirement is to enable shoppers to connect
Source: IGD Research
1
© IGD 2015
Free Wi‐Fi is becoming standard
Source: IGD Research
© IGD 2015
Action points
• The smartphone has become the remote control of consumption; basic requirement is to enable shoppers to connect
• Digital engagement does not have to be a significant investment project with apps, virtual reality etc.
Source: IGD Research
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© IGD 2015
Start small, but add value
Source: IGD Research
© IGD 2015
Action points
• The smartphone has become the remote control of consumption; basic requirement is to enable shoppers to connect
• Digital engagement does not have to be a significant investment project with apps, virtual reality etc.
• Don’t forget the back‐end; new technologies also offer the potential to improve productivity in‐store
Source: IGD Research
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© IGD 2015
For retailers and suppliers
Source: IGD Research, Field Agent
© IGD 2015
4. Step change with foodservice and HMR
© IGD 2015
Tesco made acquisitions to gain expertise
• Source: IGD Store Visits
Source: IGD Research
Casual dining Coffee shop concept
© IGD 2015
From this...
© IGD 2015
…to this at Morrisons
© IGD 2015
Showcase credentials early in the shopper journey
© IGD 2015
Do something different to your competitors
© IGD 2015
Grab & Go will meet busy shoppers’ needs
© IGD 2015
Action points
• Which meal occasions will be the primary targets and how will you user your assets outside of these?
Source: IGD Research
1
© IGD 2015
Breakfast is a growing opportunity
Source: IGD Research, Operators
© IGD 2015
Action points
• Which meal occasions will be the primary targets and how will you user your assets outside of these?
• Quick service is also key; shoppers are still looking for convenience
Source: IGD Research
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© IGD 2015
Speed of service is important
Source: IGD Research
© IGD 2015
Action points
• Which meal occasions will be the primary targets and how will you user your assets outside of these?
• Quick service is also key; shoppers are still looking for convenience; how can you ensure smooth flow for store only customers?
• Challenging to keep on‐trend; food tastes change quickly in food‐to‐go and concepts can become out‐dated quickly
Source: IGD Research
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© IGD 2015
NPD to meet missions
Source: BWG
© IGD 2015
5. Health and wellness destinations
© IGD 2015
Natural foods have made it to the front of the store
© IGD 2015
Shifting product mix to meet new shopper needs
© IGD 2015
Opportunity to integrate food and pharmacyOpportunity to integrate food and pharmacy
© IGD 2015
Using digital to assist and educate
Source: IGD Research
Mannings, Hong Kong
Coles, Australia
Lloyds Pharmacy, UK
© IGD 2015
Action points
• Mainstream retailers are investing in these categories while new operators are emerging to capitalise on the growth of this segment; smaller, niche retailers could see competitive pressures grow
Source: IGD Research
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© IGD 2015
New retailers are emerging to take share
Source: IGD Research, Retailers
Mrs Green’s Natural Market Fresh Thyme Farmers Market
© IGD 2015
Action points
• Mainstream retailers are investing in these categories while new operators are emerging to capitalise on the growth of this segment; smaller, niche retailers could see competitive pressures grow
• Similar trends can be seen in foodservice/food‐to‐go; it’s important to ensure alignment with the broader proposition
Source: IGD Research
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© IGD 2015
A shift away from processed
Source: IGD Research
© IGD 2015
Action points
• Mainstream retailers are investing in these categories while new operators are emerging to capitalise on the growth of this segment; smaller, niche retailers could see competitive pressures grow
• Similar trends can be seen in foodservice/food‐to‐go; it’s important to ensure alignment with the broader proposition
• Packaged goods are seeing a similar transition; better‐for‐you products are gaining shelf‐space
Source: IGD Research
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© IGD 2015
Gaining space in centre store
Source: IGD Research
© IGD 2015
6. Making value communication more effective
© IGD 2015
• Source: IGD Research
The promotional blizzard is confusing for shoppers
© IGD 2015
Retailers will need to deliver better prices
Source: IGD Reserach
Lower and consistently low
pricing
Fewer but BIGGER promotions
Price matching as standard
Flexible and agile pricing models
© IGD 2015
With relevant offers and pricing
Source: IGD Research
© IGD 2015
Next stop…real time price comparisons in‐store?
Source: IGD Research
© IGD 2015
Action points
• How can you get cut‐through; consider using simpler and fewer price points to get the credit from shoppers on your price investments
Source: IGD Research
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© IGD 2015
Move towards clearer statements of price
Source: IGD Research
© IGD 2015
Action points
• Use simpler and fewer price points to get the credit from shoppers on your price investments
• Consider the impact of new technologies on price transparency; shoppers are the new custodians of data
Source: IGD Research
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© IGD 2015
Price‐matching at the point of purchase
Source: IGD Research, Sainsbury’s
© IGD 2015
Action points
• Use simpler and fewer price points to get the credit from shoppers on your price investments
• Consider the impact of new technologies on price transparency; shoppers are the new custodians of data
• Think about how you can add value beyond price
Source: IGD Research
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© IGD 2015
Bus in your shoppers!
Source: IGD Research, Aldi
© IGD 2015
Inspiration for innovation
Source: IGD Research
Store design to delight and inspire
Integrating online into the store
Embedding digital into the journey
Step‐change with foodservice
Health and wellness
destinations
Making value more effective
© IGD 2015
© IGD 2015
Some of the companies we work with:
Source: IGD Research
© IGD 2015
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