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Innovating the global grocery industry

The COVID-19 pandemic left no industry untouched. Grocers all around the world served as essential businesses and critical players in ensuring food supply during a time of great uncertainty. Customer behaviour also shifted dramatically during the pandemic, forcing grocers to adapt in kind.

With such a rapid change, reports revealed that the global food & grocery retail market size, which was USD 12.29 Trillion in 2020, will witness a growth of 5% over 2021-2027, thereby increasing the market size to USD 17.29 trillion.

Throughout the year, the key players in the global food & retail market have been Enpro Industries, Inc., IDEX Corporation, Trelleborg AB, Parker-Hannifin Corporation, SKF USA, Inc., A.W. Chesterton Company, Inc., The Flowserve Corporation, Smiths Group plc, Aesseal plc, and Freudenberg Group. Region-wise, North America, Europe, Latin America and Asia Pacific had their dominance in the market. Among these regions, Asia Pacific had a significant market share, and is expected to expand over 2021-2027. The reason for which have been cited as increase in e-commerce retail sales and strong demand for processed & packaged food.

The year 2021 revealed various trends in the global grocery & retail industry. Some of these trends were quite new to the consumers too. For instance,

1. E-commerce became a consumers’ favourite mode for shopping, as it removed the need to stand in long queues to buy products. 2021 became a time for grocers to improve the shopping experience for the customers and also make online order fulfilment more efficient.

2. Grocers got a major boost from consumers’ meal dollars when the pandemic stifled restaurants and spurred at-home cooking. To fuel the at-home cooking surge and combat meal prep fatigue in 2020, retailers turned to technology to make shopping and meal prep easier. Kroger, an American retail company, launched an artificial intelligence-based digital tool that suggested recipes based on tweeted photos of food items.

But these aren’t the only technological trends which the grocery industry witnessed. If we quote the term “innovation” with “grocery” and it will instantly bring the thought of technology in our mind.

From how products are grown, harvested, transported, packaged, merchandised and marketed, to how stores operate, the age of digitisation has covered all the aspects of food retailing. With this, we can question ourselves, what are the emerging technologies in the grocery industry?

1. Grocery needs of the customers have increased in recent times. Hence, one area which grocers need to capitalise on, is prepared foods and meals.

Grocery stores have the convenience edge over restaurants, as their consumers are already shopping with them. An analysis from The Food Industry Association (FMI) suggested, “grocers are positioned to be the ultimate mealtime solution in that 39% of consumers view retail food service as a substitute for…both a home-cooked meal and a restaurant meal.”

Moreover, customers will expect the same technology available to them in other prepared meals settings, such as online ordering options, quick preparation and delivery, even in-store kiosks for made-to-order items like sandwiches or pizza. Providing these options to patrons can allow grocers to capture more of the prepared meals market share.

2. Using a hybrid ordering system for deli counters and bakery sections could prove to be another winning choice for grocers. Providing customers with pre-order options both online and via associate for deli and bakery items, as well as in-store kiosks where orders can be placed when the shopper enters and picked up as they are leaving, grocery stores can be sure to capture every way their customers want to shop. This also creates immense efficiency for grocers on the production and staffing side of the business, with the ability to forecast orders, autonomous order placement and streamlined preparation and delivery of goods.

3. With the high uptake of kiosk technology due to the pandemic, there is opportunity for continued implementation, with additional value in in store advertisements and marketing. Providing self-service kiosks throughout the store in different departments, as well as general information areas, can allow a grocer to market directly to their in-store shoppers.

4. Grocers can introduce options for smart cart. A smart cart would enable shoppers with an effortless checkout experience right from their shopping cart. Equipped with AI-enabled cameras, the cart would also auto detect the items placed inside, scans them and can even weigh loose goods.

These smart carts could also assist shoppers in locating items, making suggestions based on what’s in the cart and even promote current coupons or deals. Customers would then be able to pay directly at the cart, providing them an experience similar to self-checkout.

5. Another technological trend which can be introduced is a grocery store video surveillance. By using AI-enabled cameras throughout the store, a grocer can benefit in many ways, such as:

  • Being notified if customers have been waiting for a certain period of time at their hot food counter.

  • Seeing a heat-map of where customers do and don’t go in the store for better movement flow and placement of advertisements.

  • Understanding how many customers enter, exit and shop for any given period of time, which can help them in preparing their staff and other departments, such as to ensure a better service is provided to the customer.

6. Grocers need to understand that “convenience is king.” They need to ensure that their customer has a hassle-free experience in their store. They can implement a scan-and-go or scan-and-pay option, which will allow customers to use their mobile device to scan their items as they are shopping, pay for their basket on their device and leave the store having had a fully autonomous experience.




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