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Top Shelf Spotlight: How Technology is Shaping the Future of the Grocery Retail Industry

Strategic Investments in Grocery Technology

Is technology important to the future of your business? New research reveals that for grocery retailers, the answer is an emphatic “Yes!”

But it’s the strategic implementation of that technology that’s going to reap the best rewards.

In this edition of TopShelf Spotlight, Mark Brandau and Chloe Riley of Supermarket News are joined by Sylvain Perrier, President of North America and COO of Mercatus, to present the 2023 Supermarket Technology Review and discuss the transformative power of technology in the future of the grocery industry.

Online Grocery Software and Technology: Key Insights

Every retailer surveyed for the report agreed that technology is important to their future strategies, with nearly half considering it pivotal for upcoming plans. This highlights technology’s integral role in the evolution of the grocery sector.

However, the costs associated with increasing the technology stack, pose a significant challenge to grocers in their pursuit of further tech adoption. Additionally, the complexity of integrating new technologies with existing systems underscores the need for seamless tech upgrades.

That means that investment in tech must be targeted. But where?

Operational efficiency emerged as the top priority among those surveyed, signaling a focus on performance improvement across the industry. Customer experience was also a key priority for grocers, emphasizing their need to enhance shopping experiences and retain customers.

How grocery technology deliver streamlined operations and better customer experience?

Top 5 Recommendations

1. Harness Technology for Enhanced Operational Efficiency

In an industry where margins are often tight, operational efficiency is a necessity. Leveraging technology for streamlining operations is about more than just cutting costs; it’s about transforming every aspect of the grocery workflow. This means adopting integrated inventory management systems that predict and respond to stock levels in real-time, implementing automated scheduling tools to optimize staff allocation, and deploying smart supply chain solutions that reduce waste and improve product availability. It’s about creating a seamless operational flow that not only reduces expenses but also elevates the overall efficiency of the store.

2. Prioritize Customer and Staff-Friendly Technology

The heart of retail lies in customer satisfaction. Investing in technology that simplifies the shopping experience for the customer and empowers staff is crucial. This could mean rolling out intuitive self-service kiosks that reduce checkout times, offering mobile apps that enhance the in-store experience with features like aisle navigation and product information, or implementing augmented reality tools that bring products to life. For staff, this includes user-friendly point-of-sale systems and inventory management tools that are easy to learn and use, thereby reducing training time and enhancing job satisfaction — all of which lead to better customer service.

3. Integrate Online and Offline Retail Strategies

In today’s digital era, the line between online and physical retail is increasingly blurred. It’s essential to adopt a holistic approach that synergizes both. This involves creating a seamless omnichannel experience where online platforms reflect the in-store experience and vice versa. Tactics might include synchronized loyalty programs, unified product catalogs, and consistent marketing messages across all channels. The goal is to enable customers to move fluidly between online and offline shopping, enjoying a cohesive brand experience that leverages the strengths of each platform.

4. Utilize Data Analytics for Personalized Customer Engagement

The effective use of data can revolutionize customer relationships. By harnessing data analytics, grocers can unlock personalized shopping experiences — from tailored product recommendations and targeted promotions to customized communication. This requires a sophisticated understanding of customer buying patterns, preferences, and behaviors, gathered through point-of-sale interactions, online shopping data, and customer feedback. The application of this insight can lead to highly effective, personalized marketing campaigns that resonate with individual customers, fostering loyalty and increasing sales.

5. Explore the Potential of Retail Media Networks

Retail media networks present an untapped avenue for grocery retailers to expand their reach and engagement. By leveraging in-store and online platforms for advertising, grocers can open new revenue streams and deepen brand partnerships. This involves identifying suitable spaces for digital advertising – be it on eCommerce websites, mobile apps, or even digital displays within the store. It’s about creating an ecosystem where advertising is not just a revenue source but also enhances the shopping experience through relevant and engaging content.

Grocery Tech Action Steps:

  1. Conduct a thorough evaluation of your current tech stack.
  2. Seek technology partners that offer integrated, scalable solutions.
  3. Focus on implementing cost-efficient technologies.
  4. Develop a cohesive plan for integrating online and offline experiences.
  5. Invest in staff training for new technologies.
  6. Use data analytics for personalized customer experiences.
  7. Implement systems to gather and analyze customer feedback.
  8. Optimize inventory and supply chain management through technology.
  9. Consider testing retail media networks.
  10. Stay informed and adaptable to emerging tech trends.

Final Thoughts

Technology in the grocery industry is not just about efficiency and cost reduction; it’s about enhancing the overall customer shopping experience. Grocery retailers must strategically balance their technological investments with practical business outcomes to ensure customer satisfaction and profitability.

For more insight and analysis on grocery technology, join us for the full video discussion. If you’re interested in expanding your use of technology, contact us to discuss a strategy that makes sense for your grocery business.

Thanks for joining this edition of Top Shelf Spotlight. Stay tuned for more insightful discussions coming soon.


Headshot of Sylvain Perrier

Sylvain Perrier

Global Chief Operating Officer, Mercatus