What Are Three Strategic Priorities for Grocers to Become Customer-centric?

In PwC’s report, “Front of the Line: How Grocers Can Get Ahead for the Future,” there are three compelling strategic priorities recommended for grocers to know their shopper segments, tailor store customer experiences, and become more customer-centric.

A clear shopper-segment targeting capability, a store experience that aligns with those shoppers’ needs, and a compelling value proposition will help reshape both short- and long-term retail success, the report says.

Here are the report’s three strategic priorities grocers should focus on to create a multi-tiered experience that fits the needs of retail stores and loyal shoppers.

  • Collect detailed data for a shopper-centric focus: Go beyond the basics of knowing who your segments are and what they buy through historical-view analytics. Market-leading retailers may use history to understand current behaviors, but the most successful use that same data to model future shopper performance. We call it predictive analytics. Your loyalty programs are one source, but taking a closer look at your segments through shopper surveys and interviews can also dig into the details further.

Would your segments want an in-store cafeteria or lounge to make their trip more of an experience? Would a partnership with a local grower make them more likely to buy your produce? What store format would best position the products they care about—and also alleviate the pains of long lines and overcrowded aisles? Be able to segment your own shopper population based on their distinct preferences, and your in-store experience can better adapt.

Smart grocers are viewing their shoppers’ behaviors broadly: They look at things like spending and purchasing habits, basket composition, purchase timing and frequency, wallet share, marketing effectiveness, and branding impact. Envision your future shoppers by understanding the most minute changes in areas like these, and use that knowledge to model and anticipate future behaviors.

Keep in mind that this isn’t a one-time event: Your shopper makeup will continue to change, so collecting data and making meaning of it will be an ongoing learning experience into the future.

  • With insights in hand, get your in-store experience right: In-person interaction is still key to shoppers’ decision-making—online grocery shopping options for the entire basket still aren’t appealing to most. So make the in-store experience more personable and compelling through predictive analytics. Your store can use this data to improve merchandising and displays, update in-store promotions, and innovate through areas like shelf tagging and shopper communications. Staff who know regular shoppers’ names, their needs, and their frequent purchases can make a more meaningful grocery trip.

For the most part, shoppers we surveyed choose their grocery stores mostly based on prices and what’s close to home, as low prices and convenience are core factors behind most shoppers’ decision-making. Understand the needs of those shoppers nearest to your stores, and focus on figuring out the intricacies that can differentiate your store for the future. Continue collecting and analyzing shopper data—both historical and modeled future behaviors—to shape what your store may need to change.

Future demographic shifts will bring new diversity in culture and age groups to your stores, too, so keeping pace with the wants and needs of these new shopper segments will be especially important.

  • Build your banner and private brands accordingly: Once you’ve got a clear understanding of who your segments are and how your store can echo their preferences, you can shape your banner promise and the role that private-label branding will play with your shoppers to more clearly reflect your strategy. What’s your banner and private-brand promise to your shoppers? How can you best articulate the overall experience you’re offering?

For example, if your segments expressed a clear preference for organic food options, your emphasis on carrying them may be the benefit you amplify most in your banner brand messaging. Or if you find price-consciousness in your shoppers, consider making that factor your strong suit. Whatever the ultimate approach, ensure your banner and private-label branding matches the sentiments your shoppers have expressed. Carve out a niche that appeals to their preferences.

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