Grocery goes high-tech
Facebook for groceries? It's happening now.
According to a recent study from RIS News and IDC Retail Insights*, after enduring 18 months in a punishing economy, grocers have emerged in better shape than most other retail segments. Still, there are no expectations of returning to business as usual, and technology is a key linchpin in grocers' business strategy going forward. Read on to find out how innovative grocers around the world are evolving to succeed in the new economy.
Facebook for groceries
S Group, the largest grocery cooperative in Finland, is working to optimize its value chain, pricing and space planning (they have more than 40,000 store-based planograms per assortment period) – all built on predictive analytics and the ability to accurately forecast supply and demand.
In addition, the company is providing social networking for its shoppers with an interactive Web community, digital shopping list and recipe recommendation site called Foodie.fm. Users can access personalized recipe and product suggestions, comment on recipes and see updates and recommendations from family and friends they follow on the site.
"The personalization technology provides a state-of-the-art way for us to meet the unique needs of individual consumers," says Ilkka Alarotu, who heads up consumer analytics and pricing for S Group.
Not only does Foodie.fm provide price, product and nutritional information for more than 15,000 products available in S Group stores, users can also order the suggested groceries and have them delivered to their doorsteps. Added bonus – S Group collects information from the site on shopping behavior, customer preferences and much more.
Sobeys gets to know its customers
"Customer insight and intimacy is one of Sobeys' strategic pillars," says Clinton Keay, Senior Vice President and Chief Information Officer. "With SAS Analytics we can understand who our key customers are, as well as understand the different types of customer we have by individual market. We're a locally driven organization, with resources dedicated to providing customer service that is tailored to the markets they serve. Unless you can get it down to the operations of the individual store level, it's not going to add any value."
This customer-focused strategy has served Sobeys well. In the last 25 years alone, this leading Canadian grocer has expanded its presence outside of Atlantic Canada to become a CAD $15.8 billion national brand. And using SAS, Sobeys has a complete view of its business and customer data, allowing the grocer to use analytics to offer the right products, in the right stores, for each market it serves, as well as target loyal customers with one-to-one communications.
Family Dollar accelerates growth in down times
In today's tough economy, families are turning to Family Dollar to supply more of their everyday needs. To ensure that each store stocks exactly what its customers need – and keep them coming back for more – Family Dollar launched "Project Accelerate," a three-year transformation that ultimately will lead to a better shopping experience for customers, improved productivity of its inventory and enhanced efficiency in its supply chain.
At the heart of Family Dollar's transformation are merchandise planning applications from SAS. "Utilizing SAS and improved decision processes, we've had a reduction in inventories, an increase in inventory turnover and better visibility into merchandise planning,'' says R. James Kelly, Vice Chair of Family Dollar.
"The amount of data coming in can be paralyzing. SAS Merchandise Data Integration was able to load the data in half the expected time frame and scale to meet Family Dollar's needs. SAS gives us the ability to roll up data to the level that allows us to make fact-based decisions," says Scott Zucker, Vice President of IT Solutions Delivery.
Now planners can drill all the way down to which stores sell more spray deodorant versus roll-on. "SAS doesn't give us new data, it allows us to analyze the data in a way that is quickly actionable," says Jody Crozier, Divisional VP of Merchandise Solutions.
*RISNews.com, June 2011: Fifth Annual Supermarket Benchmark Study: Fighting Fire with Fire