Amazon Hungry to Binge on Grocery

Revelations from the 2017 Shopper Marketing Summit

Photo Credit: Kevork Djansezian — Getty Images

Nothing was more eye-opening at this week’s Shopper Marketing Summit in New York City than the lagging state of e-commerce in grocery.

Surprisingly, it was loudest and most clear in the Q&A following the keynote address by retail futurist Doug Stephens. Stephens was asked, “You covered a lot about the retail future for many categories, but didn’t share much about grocery. What does the future look like there?”

His response was chilling.

Amazon wants to win grocery badly, even after some missteps, because the frequency with which shoppers purchase groceries is a big win. Put the massive resources of Amazon against a retail channel that is operating on razor thin margins and grocery is a sitting duck. Amazon can undercut until there is no one left to undercut.

The power and intent of Amazon was in major contrast to the best practices presented by the brand and grocer representatives responsible for delivering e-commerce solutions to shoppers.

I expected to hear whiz-bang stuff — how grocers’ vast point-of-sale data is fueling smart suggestive selling. How a “duplicate my list” feature has evolved to a sophisticated recipe-based meal and snacking menu predicated on shoppers’ tastes, to-do’s, and FitBit data. How real-time notification of a freshly fished stock from the Gulf in the morning can turn into fulfilled orders for fish fry dinner plates at homes later that evening.

But it seems grocery is still stuck on delivering the catalog content basics — get pack sizes right, make sure product images and descriptions are present and accurate. This gets items to rise in search results. That’s the key.

Meanwhile, as Stephens points out, Amazon has distracted us with the prospect of drone deliveries while investing in freight and airliner fleets, regional warehouses, and a patented predictive process for shipping goods to end-users before they’ve even been ordered.

So, is there more grocery can do to gear up for the Amazon gut punch than just updating its photo assets?

Stephens suggests optimism. The future of food retail is as a medium, not as a distribution point. A medium staffed not by checkout clerks and meat slicers but brand experts and ambassadors. Product demos that deviate from Dixie Cup dollops to tasting menus. The “buy” button is always going to be there, but it will never let a shopper smell honey glazed mesquite smoked pork tenderloin. Well, maybe someday.

The grocery channel needs to quickly become less concerned with shelved goods and volume-moved, and much more fixated on shopper experience.