Nearly every large supermarket chain in the world is undergoing some sort of digital transformation. Typical areas of focus include optimizing the point of service, in-store productivity, in-store service management, shrink and gamification.
Each of these areas is operationally important, and retail executives should have a clear perspective on each. Which pain point is your organization focused on solving? Have you considered integrating your shoppers points of view or behaviors into your vision of “how you serve customers?”
Why analyze the shopping experience
A first step, however, is understanding why and how people shop for food. What role does shopping for dinner really play in people’s lives? The results of a recent supermarket chain study suggest the answer is not as simple as it first appears.
A widely held assumption among retail executives is that consumers are increasingly drawn to discount stores because they value low prices. Red Associates learned something different. Our team of social science researchers spent multiple days with a group of customers, watching as they shopped, planned and made dinners with their families. What did they uncover?
While many executives have a mental model of families meeting around the dinner table on an ongoing basis, the actual dinner experience runs counter to this. In fact, the research showed that stable family routines are dissolving, and that families increasingly struggle to predict what each week will look like. One of the most telling pieces of data from the study was the disappearance of the weekday family meal. Families simply were not eating together at the same time every day. Many families also now had three or four different diets to consider.
How does shifting behavior affect shopping behavior?
This fundamental shift in behavior has dramatically impacted shopping behavior. People in the study met were shopping more than nine times a week on average; in one case, shopping occurred three times a day. People were not loyal to specific supermarkets, and generally did not search for discounts. Instead, they chose the supermarkets that fit their need for fast, convenient shopping. After working all day, the last thing they wanted to do was to carefully consider different prices at different stores.
It’s important to reflect what the customer wants
The study also revealed that the traditional assumptions around price vs. quality were superficial. Study participants didn’t categorize supermarkets as “discount” or “premium” but instead seemed to be guided by the mood and experience of the stores. Some stores projected a mood of efficiency, while others felt fresh and local, and still others seemed practical and thrifty, offering good everyday value.
The bottom line is, supermarket chains need to reconsider their vision for serving customers and fundamentally update their value proposition, well before embarking on a digital transformation. I’d like to hear from you. What are your thoughts?
For more information on human decision making in a digital world, please read Being Digital Means Being More Human.
Find us at NRF BIG SHOW 2017
If your planning your visit to NRF 2017, stop by our Cognizant booth #3821 and share with us which pain point your organization is focused on solving. Or, we can share how we are helping companies integrate their shoppers points of view or behaviors into their vision of “how they serve customers.”