Thriving in the a Ge of Amazon Go
Total Page：16
File Type：pdf, Size：1020Kb
THRIVING IN THE AGE OF AMAZON GO USING THHE LATEST GROCERY TECHNOLOGY TRENDS TO ENGAGE SHOPPERS AND BUILD LOYALTY Contents The Amazon Engaging grocery shoppers through technology & Example psychology 3 Amazon is all Go 5 We've learned a lot from Amazon 7 Why grocery stores are adding mobile & IoT to the shopping list 8 Only Amazon was Amazon on Day One 11 Getting inside The case for coupons 12 grocery Be more likable: the art of persuasion 14 shoppers' Surprise and delight is surprising & delightful 16 Neuro(super)marketing: using personalization to make heads decisions easier 17 Why discounts work ... and why they don’t 18 Get started! 20 2 Engaging grocery shoppers through technology & psychology Mobile-enabled and checkout free stores will revolutionize grocery shopping; moving bricks & mortar retail closer to the online experience by adding connectivity and removing friction. Want to remain relevant to increasingly connected consumers? Technology is inevitable. Amazon may have blazed the trail with Amazon Go, but other companies have followed in its wake, and the tech is now faster, more affordable and more accessible. Connecting technology at all levels of maturity is very achievable. Not ready right now? The technology will become even more affordable, and even more acessible over the next few years. In the meantime, there are lots of ways to create great experiences for your customers. First step: understanding how technology and psychology can work together to meet customer expectations... 3 Mobile & connected technology is increasingly being used in grocery to create more personalized and engaging customer experiences. What's more, customers expect this level of engagement, so if you’re not using technology to create customer experience magic, you're already on the back foot. The future of grocery is connected, and technology is the great enabler - if you haven't started looking at it, now's the time. 4 Amazon is all Go Apart from a handful of examples, technology in supermarkets has been low-key and largely functional: connected price tags mean staff don’t have to manually replace labels when new deals are released, and mobile loyalty cards mean a marginally slimmer wallet. Things that gently improve the customer experience but that (for the most part) haven’t made the world sit up and take notice. Amazon Enter Amazon Go Go brought futuristic Our collective imagination really went to town on Amazon’s ‘just walk out’ grocery grocery tech concept. Not content to be the undisputed emperor of ecommerce, the brand has been rolling out brick & mortar stores and pop-up shops with relatively little to shoppers’ fanfare for a while now. It’s also not entirely new to the grocery game, but Amazon attention: and Go cranked it up to eleven and introduced a completely connected, tech- driven, checkout-(and checkout operator) free grocery shopping experience. As it hasn’t gone expected, reaction ranged from “technology is awesome” to “we’re all doomed”. away. Welcome to your reality. We love people, actually A recent study conducted for Salesforce found the majority of shoppers would rather deal with humans at the checkout, with 72% disagreeing that robots could replace store associates; andVerint reports that 83% of consumers it surveyed believe it’s important to have the option to talk to a human representative on the phone or in-store. UK chain Morrisons actually added staffed checkouts back into its stores when over 60% of customers were found to prefer them to self-checkouts. When it comes to purchases, most shoppers stick with the tried and true: 65% check out with an associate at the register, vs 22% at a self-checkout and only 5% on a mobile device. While the numbers may be low now, Nielson reports 65% of global consumers are willing to use a self-checkout if it’s available, and 72% would use scan and shop technology. The overall theme appears to be that consumers are receptive to new technology at the checkout, but they don’t want to lose the human element. OK, so maybe if they’re not on the registers it’d be a good idea to keep store associates around in a supplemental capacity; as greeters, concierges and in-store entertainment, or as overseers, bag checkers and basically a last line of defense against unwitting or unscrupulous consumers out to bilk the system (apparently a major issue facing self-checkout stores; presumably something Amazon Go has solved for with its tracking technology). 5 Amazon plans Connected stores will only work for connected to open up to consumers 3,000 Amazon In order to accurately identify customers along with their shopping behavior, Go stores by preferences, basket contents and billing information, the store will need access to a vast amount of individual data. And it will need to do some 2021, which pretty heavy real-time lifting, so you’re not going to get away with simply could generate logging into an app. We’re talking location trackers, cameras, voice and facial recognition in addition to the less literally in-your-face technology. up to $4.5 billion While consumers are more accustomed now to giving over data in return sales a year. for personalized offers, not everyone is comfortable with the level of tracking required to create Amazon Go’s level of invisible connectivity. In the same Salesforce study, consumers were slightly opposed to sharing data for a better in-store experience, and far more strongly opposed to stores using location technology to identify them as they walk into store: 73% against vs 27% in favor. Some of this is unsurprisingly attributable to generational differences: as the buying power shifts to the always-connected younger generations, we'd expect to see the appetite for Amazon Go and its ilk increase. Is it Go time for grocery? So is this the future of grocery shopping? If you accept that one day everything will be automated and optimized and digitally enhanced, then probably, yes. But we have a long, long way to go before the Amazon Go experience is mainstream. It’s still very early days for this style of store: Amazon has launched eight stores so far, and other brands are making moves in the space. We don’t know exactly what technology is being used to work the Amazon magic. Industry commentators have come up with a laundry list of possible tech including computer vision, sensors, machine learning, deep learning, real-time analytics, cameras, biometrics, artificial intelligence and RFID, but Amazon’s not letting us see behind the curtain just yet. So we’re talking a comprehensive, radical re-imagining of the grocery store experience, and that's a good indicator that the majority of retailers won’t have the resources to make this their reality. Yet. While more and more brands are starting to explore it, the simple truth is an invisibly connected, mobile-and-connected-tech-centric grocery experience like Amazon Go is light years ahead of what most are doing, or are capable of right now. 10 years down the track though, when digital natives are the majority and connectivity is king? We might have witnessed the end of the checkout operator – though hopefully not the end of retail associates altogether. 6 We've learned a lot from Amazon Leaving aside the company’s undeniable they want it. Want to compete head-on? It's going resources, the thing Amazon is most famous to take work. for is disruption. Amazon’s e-commerce growth brought with it a fundamental change in retail Whether Amazon eats the world or not remains expectations. Amazon led the way in ecommerce, to be seen, but there’s no denying its influence on and there’s a reason it’s still a poster child for the the industry. power of personalizing recommendations to online shoppers. It set the pace and had the competition – Amazon is financially imposing, with a very lucrative on and offline – scrabbling to catch up. services business apart from its retail arm. It is in a position to remain competitive without relying on As a result we’re now seeing a new type of retail, high product margins, so competing directly with where creating responsive customer journeys and Amazon on price is probably not going to be the delivering value to individuals is hugely important. wisest move for smaller retailers (i.e., pretty much everyone). Retailers are building engagement, loyalty and customer relationships, not simply moving stock Instead, it’s the Amazon-era expectations that offer through constant sales and cut price promotions. the biggest opportunity for everyone else to shine. Many retailers have embraced cognitive Create better experiences, give customers what technology, advanced CRM, personalization and they need, and if you’re in daily face-to-face contact – yes – mobile marketing for improving customer with your customers, add the personal touch that experience in and out of stores. Amazon isn’t exactly famous for. For many others, Amazon’s example represents a These personalized retail experiences are now scary new frontier of retail that they’re nowhere near critical for engaging customers, and that, more equipped to explore. than the technology, may just be Amazon’s lasting legacy. Amazon is ubiquitous, and Amazon is unrivaled at giving customers what they want before they know 7 Why grocery stores are adding mobile & IoT to the shopping list While the majority of respondents in a recent give brands access to huge amounts of data on Nielson study labeled a trip to the grocery store customer activity during a grocery shop: tracking an enjoyable experience - or a fun family day in-store movement, promotion exposure, tech out – it’s probably not a stretch to say most grocery interactions, app activity, purchases and more.