EuroShop 2020, the world’s #1 retail trade show, drew to a close last week—and boy, it was a whopper! 94,000 attendees from 142 countries came to Düsseldorf, Germany, including representatives of European grocery titans like Ahold Delhaize, Aldi, and Metro.
Halla joined the conference for the first time this year, exhibiting alongside 2,300 other retail suppliers offering the latest competitive retail solutions. And then there were the presentations—eight stages in all, offering a steady stream of ideas from nearly 400 industry leaders tackling the latest trends and developments in the world of retail.
For those of you who did not make it to the show, here are the three big takeaways that stuck out for us:
1. Digital and in-store are converging, and fast
If the convergence of offline and online retail worlds was ever in doubt, this was the conference that put the uncertainty to rest. From digital price tags to in-store mobile assistants to “smart floors” and other in-store analytics tools, conventional brick-and-mortar stores are taking their cues from e-commerce to boost supply chain efficiency, foster customer loyalty, and optimize sales.
Michael Gerling, Chairman of the EuroShop Advisory Board and CEO of the EHI Retail Institute Cologne, summarized this key theme, saying that ”Retail digitalization is booming. It enables retailers to offer their shoppers even more services and link online and offline channels, on the one hand, while simplifying process flows, logistics and lots more, on the other.”
In grocery, as well as other areas of retail, combining the “emotional discovery” strengths of in-store retail with the superior personalization and analytical strengths of online is going to be the key competitive driver in the coming years, a task which McKinsey just this month predicted will deliver up to a 15% increase in revenue across channels.
2. To successfully adopt omnichannel, retailers need technology vendors.
The pace of technological change is just too fast for any single organization to keep up with. But retail is especially complex. There are at least eight dimensions of retail, and no single organization can be an expert in all of them. When it comes to the latest and greatest opportunities in signage, in-store marketing, mobile solutions, e-commerce, payment systems, delivery services, checkout trends, lighting, display, fixtures, logistics, and energy management—”DIY” is not an option. And grocery has it tougher than most, contending also with refrigeration, in-store catering and other complexities.
Keeping up with all the change is hard enough as a management and a capital investment challenge. But beyond that, retailers just don’t have the people to do it on their own. “Large tech companies and hot start-ups continue to have the first pick of data scientists, tech engineers, robotics and artificial-intelligence experts,” said another McKinsey report, “Digital talent may be the single most important determinant of a company’s likelihood to succeed in the grocery market in the next few years.”
Sourcing top-notch technology vendors who can help them gain and maintain their competitive advantages at scale is key to the successful implementation of the omnichannel imperative.
3. Unplanned purchasing is low-hanging-fruit for grocery transformation
Digital transformation is changing one aspect of omnichannel grocery shopping more than any other—impulse purchasing. Self-checkout is enjoying a rebirth. Smartphone scan-and-pay technology, like FutureProof Retail, is reducing wait times at checkout. And with millennials driving online grocery shopping towards $145 billion in sales by 2025, people are just spending less time in-store than before.
Hardest hit by this shift are unplanned purchases like snacks, which have seen sharp declines during in-store visits. According to Euromonitor International’s industry manager of food and nutrition, “E-commerce is really a threat to these unplanned store purchases because of declining trip frequency. People are just going to the store less often.”
With these trends reaching critical mass, it is high time for physical retailers to learn a few things from their online counterparts about unplanned purchases. Providing timely, AI-powered personalized recommendations through in-store shopping apps and optimizing unused checkout potential are good ways to begin. Grocers with online stores are sitting on a goldmine of shopper data that can be repurposed to make smart merchandising and display changes.
Until fairly recently, even the most progressive retailers have tended to look at online and in-store as two separate channels. If we took one thing away from Euroshop 2020, it was that these false boundaries are well on their way to being dissolved permanently. Success in the next round depends on forward-thinking retailers teaming up with great technology vendors to bring the best of both worlds together.