Is Amazon Go The Grocery Store of the Future?

The first clue that there’s something unusual about the Amazon Go store of the future hits you right at the front door. It feels as if you are entering a subway station. A row of gates guards the entrance to the store, known as Amazon Go, allowing in only people with the store’s smartphone app. Inside is a 1,800-square foot mini-market packed with shelves of food that you can find in a lot of other convenience stores.

For grocers, the store’s opening heralds another potential disruption at the hands of the world’s largest online retailer, which bought high-end supermarket chain Whole Foods Market last year for $13.7 billion. Long lines can deter shoppers, so a company that figures out how to eradicate wait times will have an advantage.

Brick-and-mortar grocery retailers can not afford to be passive. They now need to address these new demands. It may prove to be more challenging than many of them expected. To enable great services, retailers will need to successfully navigate new territories by integrating multichannel operations, through online customer incentives, and all the way to keeping food fresh during the last mile.

Modernizing Grocery Delivery: Amazon Go way

Consumer demand for seamless grocery shopping is growing rapidly, bringing about radical changes in the industry. Home delivery and click & collect operations are now “must-haves” for retail grocers.

Considering the speed at which technology progress, it’s no surprise that grocery shopping is moving towards an omnichannel experience. According to a recent FMI/Nielsen survey, online grocery sales in the U.S. are forecasted to grow from just over $20 billion in 2016 to $100 billion by 2025. To enable delivery services, retailers will need to successfully integrate multichannel operations, through the online channel, and all the way to keeping food fresh during the last mile.

How Last Mile Delivery System Can Solve the delivery challenges

Although grocery chains will have to overcome several obstacles as they implement Omnichannel services, it doesn’t mean that the transformation needs to be painful. While many grocery chains will be new to the delivery game, the main goal is always the same – provide customers with a seamless, efficient, and enjoyable experience from the point of purchase and all the way to delivery.

The Key Factor to go Omni-channel is Logistics Management.

With grocery retailers now under pressure to rapidly evolve, most are considering how and when to build out their delivery operations. Their options, timing, value to customers need to be carefully assessed. This is especially true because the expenses related to delivery operations will be greatest in the beginning.

Key logistics management breakthroughs that make omnichannel experience better

Same-Day Priority Delivery

According to a recent Accenture report, at least 60% of online shoppers are ready to pay an additional amount for same-day delivery or scheduled delivery.

When it comes to grocery shopping, priority delivery is a critical component. Especially in online grocery shopping, customers expect their packages to be home delivered, free of cost, and at a time and place of their choice.

Recent innovations in automation have given companies the option to even make one or two-hour deliveries. All this is born from a desire to serve the customer with immediate and lasting solutions to their everyday requirements. The idea is to fulfill the impulse buy principle of consumer goods sales.

Real-time Delivery Tracking

Last-mile delivery has evolved to the level that all stakeholders of delivery get real-time updates about the movement. The customer and the store manager can, at the same time, track the en-route delivery as it reaches the customer. This adds to the control the store manager has on the last mile deliveries. It also adds to the satisfaction level of the customer, knowing when, exactly, a product would be delivered. The next phase of this tracking is the electronic proof of delivery (ePoD). Through ePoD, invoicing has become a hassle-free and transparent affair.

Dynamic Delivery Rerouting

Retail and e-commerce companies alike have faced the trouble of en-route rerouting of deliveries due to last-minute destination address changes (or preferred delivery time changes) done by the customer. Companies can now re-route their workforce as soon as such an update appears. There would not be any downtime or delays in any deliveries due to this shift in schedule. Such dynamic and real-time schedule management has become the cornerstone of an ever-evolving retail and e-commerce sector.

Summary

While other ‘brick-and-mortar’ retail sectors have already been disrupted by their online equivalents, grocery has been mostly insulated from the trend – until now. We’ve finally reached the exciting time when traditional grocers must expand their operations to meet the needs of digitally engaged shoppers and beat competition from giants like Amazon.

Grocery retailers that genuinely understand the pivotal role of deliveries and the opportunities that come with them will reap the benefits of a deeper bond with their customers – turning technology and operational efficiencies into superior brand experiences and lasting customer loyalty.