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More local, more often: supermarkets must change with the times - part1

retail

As consumer habits change, the top chains are losing the battle for market share, but technology can help to keep shoppers happy

 As Sainsbury’s chief executive Mike Coupe recently declared, retailers are facing a “perfect storm” of problems, from a revolution led by convenience stores and discounters. Industry body IGD forecasts that sales in small neighborhood stores will increase by 31% to £49bn in 2019, with consumers shunning big weekly shopping expeditions in favor of smaller, more frequent local trips.

The days of the top four supermarkets controlling how shoppers buy their groceries are over. Convenience stores are already leading the way in understanding the latest shopper habits, for example, stores designed with the evening meal in mind. Shoppers are now more time-conscious and tech-savvy, and have more choice about where to shop. This means that supermarkets have to work even harder to keep loyal customers.

Instant decisions

Supermarkets must understand that the time between the decision to purchase and making the payment is getting shorter. It already happens in convenience retail. When a shopper picks up an item, such as a meal for the evening, they want to pay for it instantly rather than join a queue. Shoppers are used to making instant decisions, with up to 70% of purchase decisions made at the shelf. To adapt to this change, supermarkets need to start providing choice for shoppers on where and how they want to pay, rather than only providing traditional checkouts at the exit.

Apple Pay and PayPal have already launched mobile payment options that are entering US fashion and fast-food outlets. The next step is for supermarkets to embrace this technology. Launching in Asda and Sainsbury’s next year, Zapp is a mobile payment system that allows shoppers to use their mobile devices to pay for groceries at the checkout. To be even more convenient, mobile payment options should allow customers to skip the physical checkout if they are only picking up a few items, while still offering the option for a face-to-face interaction with a cashier.

Checkout innovations

The checkout experience is an area that most supermarkets look to target when improving convenience, with the vast majority now embracing self-scan technology. With customers becoming increasingly time-starved and queues still a bugbear, rapid-scan technology will continue to evolve. It’s something we’ve worked on at Wincor Nixdorf – a high-speed checkout that enables customers to place shopping on a conveyor belt, watch it pass through the 360-degree laser scanner and then pack it all up in one of two bagging areas.

Waitrose is also trialling the Hiku home scanning solution, where items can be scanned and added to an online shopping basket as they leave the fridge at home. Most supermarkets also now offer click-and-collect services as well, with online grocery sales up 17% on last year. It’s these innovations that give shoppers faster, more convenient options to complete their purchases.

 Compiled in Editorial Board of Retailiran

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