IDC Retail Research Highlights Importance of Personalization in Grocery

The dynamics of the food retailing environment continue to challenge companies to keep pace with shopper demands. The latest of these shifting shopper desires involves their behavior on digital platforms. This change is creating an imperative for grocers to compete digitally as well as in store.
Research conducted by IDC Retail Insights, and commissioned by Precima, casts light on the current state of digital food retailing and what food retailers need to do now to drive success. The research shows that while continues to be a primary disruptive influence in consumer goods retailing, it struggles with retaining food shoppers. Another opportunity for grocery retailers revealed from the research is that shopping exclusively online is still relatively rare, so optimizing in-store experiences can help retain customers who might otherwise prefer digital options. A recent survey from Food Marketing Institute (FMI) confirms this opportunity, revealing that by 2022 consumers could be spending $100 billion a year on online grocery.
Brian Ross, CEO of Precima, says of the issue, “Retailers have finite resources that are shared among competing merchandising, operational, and marketing priorities. They need to make smart decisions about where to invest in digital capabilities and how those capabilities and business decisions fit in with the rest of the organization. The successful retailers are rapidly developing and deploying digital capabilities to compete more aggressively. Our new research separates facts from hype and discloses the tactics that are paying off today and will pay off tomorrow.”
Ivano Ortis, Vice President, IDC Retail, Manufacturing, Financial Insights, adds, “Consumer expectations require grocery retailers to implement new customer experience models and technology architecture. Investing in advanced analytics, personalized offers, and localized assortment optimization, while adapting the store format to shoppers’ behavior, will allow grocery retailers to achieve short-term success.”
Additional key findings from the research include:

  • 63 percent of shoppers say personalization is important.
  • 35 percent of shoppers will spend 26 to 40 percent of their grocery budget online by 2020.
  • A personalized customer experience strategy is a clear opportunity for brand differentiation.
  • Consumers expect a seamless experience throughout in-store and online journeys.
  • Personalized offers are vital for e-commerce, and wish lists are an opportunity to enhance shopper experience and loyalty.
  • Retailers expect major disruption in the next three years, from operations automation, retail commerce platforms, and added-value shopper services.

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