Lists have always been an essential tool of the grocery shopper. Lists used to be simple oft-times taking the form of roughly penciled “categories” such as milk on any piece of paper or cardboard handy. They served as a reminder to a shopper who kept the details about brand, item and size in their heads.
I believe the grocery list will become the most powerful customer loyalty and customer centric marketing tool ever devised. My plan for this blog is to:
· Review the last two major “upheavals” in lists
· Review the major innovations and talk about why they aren’t so new, how some have regressed and how there has really been very little innovation for almost a decade.
· Talk just a bit about what needs to happen to make list the most powerful customer loyalty tool and customer centric marketing tool ever devised.
· Talk a bit about the companies I see that might be able to play in the development, implementation and potential domination.
Last Two Evolutionary Trends:
In the last 10 years the “list” has become both more and less useful..in fits and starts.
Lists took a radical move toward more utility with the advent of serious online grocery shopping in 2001. At that point they moved from category and subcategory…to items, with UPCs! Full grocery store assortments became available and loyalty programs allowed retailers, usually supported by online service providers such as MyWebGrocer, to give consumers a choice among real products they had shopped for before.
Most recently beginning about 2009, a number of other list services, not necessarily connected with any particular grocer are emerging. Some of these are focused on savings (allyou.com has a localized circular tracker that compares all of the circulars in your immediate neighborhood). Others are more traditional lists with bells and whistles that either give you optional drive-downs to brand based on pre-loaded products (which presumably either advertisers or other shoppers have specified) or allows you to scan items at the upc level or capture a picture for identification….if any data on that product exists in the supplier’s database.
Major Innovations in Lists
Six innovations on the path between general category and item specific lists:
1. The use of loyalty data to drive lists for online grocery shopping or use in the store. Loyalty data from in-store shopping made for an effective “seeding” into the list. In cases where loyalty data was not available, shoppers could build lists and save/name them for a variety of purposes (holiday list, vacation list). The best applications organize lists by category and subcategory. Current preferred store assortment, prices, specials and retailer coupons were all incorporated into the list. If the customer wanted their list applied to a store that was not their preferred store (picking the one on the way home from work rather than their primary store) than the list modifies itself to reflect the assortment, prices, specials and promotions from that store. All of this of course is within a particular chain or banner.
2. The interoperability of other applications into the list. A shopper could add specific items from recipe engines, from the electronic version of the circular from the coupon pages and so forth directly into their list.
3. The use of loyalty data and product scoring mechanisms to focus the hundreds of circular items each week into a dozen or so key products that should be of prime interest to the shopper. Not “you bought coke so here is a deal for pepsi” or even “you bought catsup so you need hot-dog buns” but products that the shopper had actually bought in the past.
4. Moved the list to the mobile consumer. First through email. The combination of lists (most often purchased items), shopper specific specials in a neat little package that they could either use as their total trip or use as a starter and delivery/pickup slot holder allowing them to finish the order off later from their laptop.
5. Adding aisle locations (as best could be done) This made the list, already heavily used in the store, more useable.
6. The addition of non-retailer, errand based items (cleaners, wine store, drug store). This was primitive, much like many of the early generic lists, but was an early form of trying to serve greater shopper needs with the host grocer as the “portal.”
These innovations all occurred between 2001 and 2004, most of them with me at MyWebGrocer. Since then there has been very little innovation. The three notable, improvements since that time are:
a. You can share the lists via mobile phone. This is not much different than the old email days, but it is more portable. Also some of the newer lists let you mark off what you already purchased which is handy for you….and if you need someone else to complete the shopping accurately, quite handy for them. GroceryIQ is pretty cool here.
b. You can scan barcodes to add products to your list. In some ways this is less cool than it seems. You would do this for three reasons:
a. You wanted to see if there was a coupon available on the product.
b. You were in a store that was not your normal store and you wished to remember the item.
c. You want to add it to your list, but not for this trip
In these cases the chances of the application returning any useful information including the name or the correct image of the product are very, very remote according to studies done by ShelfSnap (shelfsnap.com) and by GS1-UK.
c. The application can be owned by a retailer or non retailer and may not be aligned with any particular retailer. The shopper could have lists for each of his/her available retailers in one application. They could have lists comparing prices on products they like or at least on categories in which they buy. Some of these applications are not list builders at all except in the most rudimentary sense, but instead are price comparison applications. Again, the application seems cool but …. The ability to combine relevance to any one consumer, and the availability of product images and information on that particular item or family of items is a very limited. Usually the application is using circulars to satisfy the comparison, and product UPCs are usually not included in the ads. An example, Grocery Circular Roundup by allyou.com is independent of any retailer. A retailer owned version might look like Just For U from Safeway.
What Needs to Happen to Harness Lists: Manufacturers, retailers and now, even applications and service providers have approached most application development from their own perspective. “How do I keep the loyalty of my customer, or …how do I earn the loyalty of her customer?” In reality loyalty can only be given, and only by the consumer.
Back in January of this year I wrote:
Mobile adds yet another dimension to the multi-store, multi channel choice game that is developing for consumers. Electronic coupons, online ordering for a variety of delivery options (online, via mail, store pickup), shopping comparison tools and the like. All of these developments seem aimed directly at the heart of shopper’s loyalty to any specific retailers, particularly for oft-purchased items. These applications fly in the face of what retailers had hoped to achieve. They had hoped to convince shoppers to go to one place to buy everything.
In reality, at least for oft purchased, items consumers want the same thing.
In our view: Customer needs drivers fall into a hierarchy that is definable with a finite number of common variables, but with infinite time and intensity variation. Some of these are:
1. Convenience -What I want, when I want/need it.
2. At a price I am willing to pay,
3. Don’t make me work hard to get it.
4. Occasionally surprise and delight me with relevance.
5. Anticipate my wants and needs
6. And . . . don’t do anything that will make me go or look elsewhere.
We believe, structured appropriately these new technologies can be bundled into a shopper specific list. This would help the shopper achieve a new level of satisfaction with the entity which is devoted to meeting these needs for each consumer. We call the vision around this development Shopper 5.0. Done well, this list will produce more loyalty than anything ever built .
The Companies who Might Drive Building and Operating THE LIST:
· Amazon
· eBay
· Visa
· Catalina
· Walmart
· Tesco
· 2- 3 regional players
I think more than one but fewer than a half dozen players. It will take much more than the shoppers list. The guys who don’t have stores will form a variety of relationships with a group of retailers-suppliers that will serve as a physical touch point. But, the list will be the critical element.
And it won’t be your grandmother’s grocery list.
Shopping lists for grocery appeal to some shopper segments, but need to be kept in context of the shopping experience. Industry research identifies about 35% of shoppers are list builders, 35% plan for a couple of meals in advance, and 30% wing it in the aisle. ShoptoCook, Inc. provides shopping list technology for Retailer’s web sites, mobile applications, and for in-store interactive devices; based on daily usage data, shopping lists are not a viable stand alone solution. There are likely many reasons for limited demand to date for digital shopping lists, but for many shoppers, they simply don’t spend that much time planning. The failure of planning is neither good nor bad since the many brand products purchased are based on impulse in the aisle, and for many shoppers it is the spontaneous element of shopping that makes it fun!