shopper

Third Party Grocery Delivery? Omnichannel Grocers Wrestle With Choices

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grocery delivery

THIS MORNING on RetailWire.com I jumped on my high horse again with this little screed about grocery delivery strategies for supermarkets. As usual, I didn’t shade my opinion about 3rd party solutions, and I know some will take exception. That’s OK. The debate is important.

For perspective, when I founded the VStoreNews e-letter in 1998 I posited a world where grocery stores delivered everything – their own products plus those of other local retailers. Hasn’t happened yet.

The Grocery Delivery Debate

My comments today on RetailWire.com:

I’m squarely in the camp that advocates for own control of all customer-facing services by the retailer. High delivery costs remain a challenge, but this factor must be accounted for in a comprehensive manner. What do you really risk when you put digital moments of truth in the hands of an outside solution provider?

Third-party services intermediate the retailer’s service experience and divert essential data about shopper behavior. I could never agree to hand over control of my brand relationships to gig-workers directed by a company that is angling to become my competitor.

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A Little Problem With Big Data

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Courtesy RetailWire.comA STIMULATING DISCUSSION in RetailWire.com this morning led me to once again think deeply about how retailers are confronting so-called Big Data and applying it to their businesses.

The question posed was an intriguing one, given the continuing hype and mysticism ascribed to Big Data over the past several years.

What is your take on the advancements (or not) retailers are making in the use of data capture and analysis? Is it all leading to significantly improved customer experiences down the road, or something less?

The responses mostly seemed to accept two tacit assumptions: One, that all store data is Big Data. Two, that the primary goal of Big Data analytics is the creation of targeted promotional offers. I have a little problem with that.

When did retail POS data suddenly become Big Data? We’ve been collecting it (and mostly discarding it) for decades. Now that storage costs have finally declined, we can capture and hold it long enough to run a few queries and design a few models. Shopper in-store data really hasn’t changed much, but our ability to mine its potential has certainly advanced.

Certainly data flows from the POS and frequent shopper programs continue to expand. There are even some new sources, like in-store shopper tracking, entering the mix. Yes there’s lots of data. But is this really Big Data?

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The End of Loyalty

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Tom Fishburne cartoonIF IT EVER WAS, it’s fading fast. I’m talking about shopper loyalty and the card-based frequent shopper programs that try to pass as loyalty builders.

I’ve long been a skeptic about the premise of customer loyalty. Card based programs are more about behavioral modification, segmentation and targeting. In many instances — airlines come to mind — the net result is the cultivation of dis-loyalty and skepticism, as a consequence of added complexity, suffocating rules, suspect prices and incentives that many users can never achieve.

Now comes news that the Kroger supermarket chain has begun converting its frequent shopper card holders to a smartphone app. This is news with big numbers behind it, as 96% of Kroger shoppers presently possess a card. Its personalized marketing subsidiary, dunnhumby, is surely driving this action.

This morning, the good folks at RetailWire.com asked its distinguished BrainTrust panelists: “Will Kroger’s App Replace its Loyalty Card?”  Here’s what I had to say about it:

Welcome to the post-loyalty era.

Card programs are not quite obsolete, but they are about to be absorbed by mobile apps. While a front-runner such as Kroger/dunnhumby may be able to convert many shoppers to its proprietary app for a while, the lasting future will be defined by electronic wallet solutions that aggregate frequent shopper plans, coupons and payments on the shopper’s terms. NFC communication with the POS will likely be a key enabling technology.

An observation: The pure value of of frequent shopper data is approaching its zenith. It now diminishes slightly in relative significance as the volume of social media interaction grows. This is the mind-bending next stage in behavioral-based marketing: Things people do, say and experience outside the store may soon eclipse what happens within the four walls.

For retailers that have steadfastly bucked the loyalty-card trend (like Walmart), this may be a moment of affirmation. Or maybe they just got lucky.

© Copyright 2013 James Tenser

Stalking Privacy

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TargetedTHE ERA OF INDIVIDUAL PRIVACY may turn out to be a mere blip in the sequence of human history, as the smothering embrace of the World Wide Web makes our every click and consumption act a new molecule in the Big Data tsunami. Marketers salivate at the potential to sift the flow and aim relevant offers with pinpoint accuracy.

If they have their way unimpeded, privacy may turn out to be the human right that never was. People with means may put up barriers to make their personal information difficult to obtain. Everybody else would stand naked in the virtual town square, shielded only by the sheer numbers of their peers.

No wonder reasonable people worry that targeting may easily transmute into stalking when marketers apply automation to their process. The mechanisms and practices are not readily visible to normal citizens. I think this makes the reality both better and worse than it really seems.

This morning I offered this perspective on RetailWire.com as part of a discussion, Are Shoppers Entitled to Privacy While They Shop? This is a topic rife with assumptions that deserve to be challenged.

Here’s my take:

There is no natural right to privacy in the public domain. But protecting privacy may be the preferred practice for marketers and even governments.

If I enter a place of business (in-store or online), I should reasonably expect that my behaviors are open for observation.

But I’m not obligated to like or accept this. I can vote with my feet, clicks and dollars by preferentially visiting or patronizing establishments that adhere to a less creepy standard.

So I would propose that marketers make a habit of disclosure that is not buried on page 18 of the terms of use. Reminders about shopper tracking should be automatic and opt-out mechanisms provided.

If consumer privacy can be bypassed in the name of marketing relevancy, then certainly the marketers themselves should have zero expectation of privacy about their methods and objectives.

Disclose. Disclose. Disclose. Let shoppers tell you what they will accept; then market to meet that expectation.

[Tenser excerpt from Are Shoppers Entitled to Privacy While They Shop? discussion on RetailWire.com, Mar. 15, 2013.]

© Copyright 2013 James Tenser