The grocery business is the latest retail sector to fall under the spell of customer-driven technological revolution. With 40% of its sales now coming through mobile devices, it can hardly be a surprise. But could it be the sector that finally drives all retailers to embrace new technology and new ideas, new paradigms and new ways of doing business?
According to the UK FMCG Deep Dive – Taking Stock of the Future of Grocery report from Criteo, 7% of UK grocery sales are now online and 40% of those are mobile. This is driven by our love of click and collect, but it also shows how shoppers are radically changing how they shop. A decade ago ordering online using a mobile and then collecting it in store would have seemed like a crazy idea. Shopping on a mobile is sensible enough, but having it put aside and then collected? Madness: if anything this was a backward step.
But, as with the vote for Brexit or Trump becoming president, people are driving strange things to happen (you watch, Jeremy Corbyn will be PM by the summer, I kid you not!) and retailers need to start catering to what they want.
This is what is driving the grocery industry to start to embrace change. Tesco this week has announced plans to allow Google Home users to add things to their Tesco shopping basket via the Google personal assistant device. Moreoever, the device is also going to understand what the shoppers favourites and frequently purchased items are and use that to refine how it interacts with the shopper.
This is interesting in two ways. Firstly, it marks a major move by a major retailer towards embracing a very new technology. Secondly, it marks a major shift in how a big brand interfaces with its customers, ceding some of that brand touch to another massive brand.
The move to embrace home help technology is canny, but not surprising. Not everyone has an Google Home – nor an Amazon Echo – and Apple’s version hasn’t been released yet, but the age of speech interaction is upon us and it won’t belong before we are talking to the internet. Hey, we might even start using smartwatches.
This will make shopping more natural and more fun and will slowly become part of the everyday (although, given that the great British shopper embraced click and collect, who knows where speech commerce will go – probably everyone yelling at their Echo or Home pod what time they want to collect from the shops, but I digress).
Right now Tesco has got into bed with Google, but I am sure that if it takes off – and when Apple introduces its Siri enabled home assistant hub later this year – major retailers will look to service all of them. There will also be moves to talk to your apps and so on. But that isn’t why this is interesting.
What is really interesting is that Tesco has, as I said, ceded control of some of its customer interface to Google. Tesco is a massive brand. With a massive PDF of brand values and brand rules (I’ve seen it!). It values its customers and does all it can to ‘own’ them.
But to fit in with the way shoppers want to use technology – especially home assistant devices – they have to hand some of that over to the home device brand. In this case it is Google, but imagine when it is Amazon too.
That would be quite a move: Amazon would be the point of contact for shoppers want to dictate their shopping list to their app.
This is just the beginning: we are on the verge of retail totally shifting in how it works. How people shop is rapidly changing and even the big retailers are getting on board and having to do things that, a year ago, would have seemed laughably absurd.
But we live in topsy-turvey times and anything is possible. While politically it makes me nervous, from a retail perspective I think it is really exciting. And you only have to look at young whippersnappers like Missguided to see what retail should look like.