Groceryshop 2023 wrapped up late last week in Las Vegas, bringing together grocery leaders, suppliers and industry watchers to discuss the biggest challenges and opportunities facing food retailers.
The Winsight Grocery Business team of Russel Redman, Timothy Inklebarger and Heather Lalley tallied lots of steps on the show floor and many hours at educational sessions and one-on-one interviews with speakers and attendees.
Here are some of the team’s takeaways from Groceryshop 2023.
In a keynote interview at Groceryshop 2023, Kroger Chairman and CEO Rodney McMullen said “plates”—i.e. meals per person—is one way he measures the value his company brings to customers, and the grocer’s Our Brands private-label portfolio provides a key vehicle for delivering shopper savings. CNBC retail and consumer reporter Melissa Repko cited Kroger’s value-focused Smart Way brand. “You're doing everything you can to make sure the customer understands the value for their money,” McMullen explained. “Smart Way is a brand that we started about a year ago, and we continue to add SKUs. For that [brand], it really is the customer looking at that entry price point, a great value for the quality. I always think of it as plates. You’re spending on a bunch of plates. One of the things we’re doing is to try and make sure we’re supporting that customer, who will be eating at home more, and making it easy for them to put a full meal on the table for $8 or $10 at most.”
Value means more than just low prices, according to Erica Thein, Target’s VP of food and beverage owned brands, and that concept guides the retailer’s operations. Target shoppers are also looking for “ease, convenience and inspiration,” Thein said. Target’s new meal kit dinner solutions, made with a mix of private label and owned brands, in offerings such as pulled pork sliders and mac & cheese, have been a popular grocery addition. “They’ve been a hit with guests and help us to hit on the entire value equation,” she said. Target has three food and beverage owned brands, and more than 45 private-label lines chainwide. The Minneapolis-based retailer’s best-selling private brand, Good & Gather, generated more than $3 billion in sales last year.
Combatting retail theft
Giant Food made headlines recently for removing some national-brand health and beauty products and replacing them with private-label items at one Washington, D.C., store as a way to combat a high incidence of theft. Groceryshop VP of content Joe Laszlo asked JJ Fleeman, CEO of Giant’s parent company Ahold Delhaize USA, about the move, which is “a real issue,” the executive acknowledged. “We have taken the opportunity inside of that one store in a very important category, but one category in health and beauty care, to pull some of the national-brand products from the store to see if we can get retail theft under control,” Fleeman said in a keynote chat. “In addition to that, we’ve reached out across the industry. We’ve worked with other retailers. Our AP [asset protection] teams have worked with local law enforcement. We’ve invested in technology leveraging AI to identify scanned items at the self-checkout. We’ve got technologies that many people here have seen where shopping carts are locked up as we identify something that hasn’t been scanned. But I think it’s important to remember that it takes us all to make a difference on this topic, and we think that we’re making really good improvements in that area.”
AI looms large
Artificial intelligence dominated the conversation this year at Groceryshop, with grocers, tech-powered delivery companies, third-party service providers and others rolling out new technology and discussing how they’re incorporating machine learning into their workflow.
Diebold Nixdorf highlighted its new age-verification technology that enables grocers to speed up alcohol sales at self-checkout lanes. The technology uses AI to analyze video footage of the customer and provide an age range to determine whether they’re old enough to purchase the item. WGB was given a demonstration, and AI-powered camera system determined the age exactly.
Instacart made headlines at the show, as its IPO overlapped with Groceryshop’s kickoff. It also provided demonstrations of its newest technologies, including its new partnership with ChatGPT that enables shoppers to ask the AI-powered function questions like, “What do I need to make tacos?” Instacart also offered demonstrations of its newest generation of smart carts, which use computer vision to add items to a shopper’s list immediately after they’re placed in the cart.
Simplifying online grocery shopping
Making online grocery delivery as easy as restaurant ordering is a key focus for Uber Eats, Pierre-Dimitri Gore-Coty, the company’s SVP of delivery, noted. Uber added grocer delivery three years ago, at the height of the pandemic, and the company has since focused on investing in technology and creating “deep partnerships” with grocers, Gore-Coty said. “It wasn’t necessarily obvious at the start … what we can say today with confidence is we have been and we are going through structural change in consumer behavior. Express delivery has moved from nice to have to have to have.”
IT pros need to become grocery pros, too
Having knowledge of the business has become more critical for grocery industry technology teams, Save A Lot CIO Jennifer Hopper and Cub Foods CIO Luke Anderson noted in a session at Groceryshop. Hopper said Save A Lot has an “immersion” program to familiarize IT staff with the business operations they support. “So getting your tech teams into the stores. For us, we’re a wholesaler and also a retail banner. And so getting them into the distribution centers. We take our product meet within IT and then they have an immersion day at the store—every single step of the way from ordering inventory, checking someone out, etc. It helps them see the connection.” Cub’s Anderson agreed. “Because of how deep technology is going in business day, I think it’s our responsibility on the IT side, the CIO side, to really take accountability for those change management outcomes,” he said. “That’s a lot easier when your people really do have a deep understanding of the business, because not only are they talking to the right people in training or whatever organizations, but they’re also able to spot where we might have problems.”