Obstacles Become Opportunities with Retail Technology
Retailers are facing a sea of challenges as they navigate this holiday season and prepare for the coming year. Progressive Grocer asked Sean Turner, co-founder & CTO at Swiftly and member of the Forbes Tech Council, how technology can transform the challenges of today into the opportunities of tomorrow for brick-and-mortar grocery retailers.
Progressive Grocer: Grocers are waging an uphill battle in an increasingly competitive marketplace. How would you sum up the situation they’re facing?
Sean Turner: Record-high inflation, unprecedented gas prices, ongoing supply chain issues, shrinking margins, and looming mergers are accelerating competition for shoppers’ dollars. And it’s not only grocers feeling the pain. We ran a consumer survey in November, and out of 1500 respondents, roughly 70% said they’re struggling to pay their grocery bills due to increasing costs. This is just one example of the impact economic challenges are having on today’s retail environment. Throw in the growing preference for a tech-centric customer shopping experience, and it becomes clear that retailers will need to up their digital game to remain competitive moving into 2023 and beyond.
PG: As a leading provider of retail technology solutions, Swiftly is on the front lines of grocery retailing. What impact do you see technology having in that space?
ST: Simply put, technology solutions are going to be the key to survival for brick-and-mortar retailers as they address the growing expectations and strained budgets of today’s shoppers. Yes, customers are back to shopping in-store, but they now rely on digital solutions to help them shop — and save — more than ever.
Shoppers are shifting gears when it comes to their reliance on retail apps, with over 50% of our November survey respondents sharing that they rely on cost-saving tools such as loyalty programs and digital coupons to stay on budget. Additionally, the number of shoppers buying online, then picking up in-store or curbside has decreased from 45% to 32%1, while the number opting against home delivery is expected to increase by 25%.2 What’s this all mean? If retailers don’t choose digital transformation now, they’ll pass the opportunity to attract and retain customers — and revenue — to the competitors who do.
PG: What’s the solution? Can traditional brick-and-mortar grocers with limited staff and tight budgets really compete with e-commerce giants like Amazon?
ST: Yes, the retail giants have a broad reach. But retailers of every size can capture market share. There are four key steps to a successful digital transformation, and they’re easier — and more cost effective — to implement than you’d think.
■ Give shoppers a user-friendly, savings-rich mobile app. Most shoppers actively use their smartphone in-store, so offering a mobile app that reaches them along every step of their shopping journey is, what I would argue, the most important step.
■ Create a loyalty program. Shoppers are looking for the best deals and they depend on retailers to help them find them. Over half of respondents in our survey rely on loyalty programs and rewards to help offset increasing grocery prices.1 And 15% of shoppers say they spend more when they join a loyalty program.3
■ Establish a retail media program. Retail media is now 11% of total ad spend.4 With $100B in margin-rich revenue on the table, there’s never been a better time for retailers to establish their own retail media program.
■ Find an insights-driven partner who offers real-time, first-party data and analytics measurement. The days of relying on third parties to manage customer relationships and handing over valuable first-party data are over. When retailers own their digital properties, they have a deep understanding of individual customer behavior, spending habits, and lifetime value that lays the groundwork for omnichannel success.
PG: Any final thoughts you’d like to share?
ST: Customers will never abandon their phones, competitors will vie for their loyalty, and brands will continue increasing their advertising investments. The only way brick-and-mortar retailers will continue to grow and succeed is understanding trends, embracing new technologies, and adjusting their digital transformation strategy accordingly. 2023 is just around the corner. So, I’ll end by asking grocery retailers: “What steps are you taking to upgrade your technology in ways that will help you succeed in the new year?”
GET STARTED ON THE ROAD TO DIGITAL TRANSFORMATION TODAY! www.swiftly.com
1 Swiftly Consumer Survey data; survey conducted Nov 2022 via Gutcheck
2 ChaseDesign Online Shopper Survey
3 Coresight Research4; WPP’s GroupM