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“We are seeing a manufacturing industry that’s become faster, quicker sleeker and allows us to actually create more personalized offerings.” experience to evolve. That’s going to cause those who are complacent to become disruptive.” There’s no doubt that technology will continue to play a major role in this.
“They don’t have the advantages they once did,” he said. “Excessive complacency can happen to any company when it fails to try as hard as it should.” As always the big question is what retailers should be looking for in terms of customer behavior. “There are a couple of drivers out there. extreme diversification of preference or personalization,” Gutsche said. “They want things on-the-go and there’s a big drive toward sustainability and health – all of which impacts the types of items in the store. “A trend I really like is what I call the ‘next best thing,’” he said. “The idea is that people don’t always go for the No. 1 product anymore. They still remember the recession and are more likely to try the next best alternative. This isn’t just about price. It could be an entirely different product.” Clearly, these are among the elements reshaping the retail business. “Retailers are becoming a lot more competitive and there will be something of a shakeout in the business,” said Gutsche. “Retailers that are aggressive about change will enable the buying
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“Big data is helping us understand purchase patterns in the store,” he said “Things liked beacons are allowing people to tailor things like advertised products and recipes as they go through the store.”
“They don’t want the exact same food or offering as everyone else – something tailored to them,” he said. “On one hand you have the world of big data where marketers and other companies can figure out more easily what a person’s preferences are.
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According to Gutsche, having that social media connection will allow the grocer of the future to suggest combinations of foods that go with the person’s purchasing pattern.
“For example, if you know someone’s on a gluten-free diet then you don’t need to present her with one-third of the offers that you might send to other people,” he said. “This enables you to create a deeper connection with that customer because you understand their preferences, behavior and priorities.” The issue is one of “convergence”, which can be a challenge to find.
“The question is what products or services can be combined with the offering,” he said. “For example, if a retailer has cooking classes in store he’s adding a service and not just selling groceries.” Another factor is “divergence” or customization and personalization. Society is moving rapidly toward a customized world, according to Gutsche. Divergence is the idea that people want to be opposite of the main stream.
“On the other hand we are seeing a manufacturing industry that’s become faster, quicker sleeker and allows us to actually create more personalized offerings,” he added. How far can personalization go?
“Well, look at Amazon Fresh,” said Gutsche. “It’s showing you books and products similar to what you last reviewed. And every time you log in the offerings get a little more customized. They are the masters at figuring that out and it gets faster every time you shop.” Another element is what Gutsche terms “redirection” or channeling and refocusing trends.
For example, if someone goes into a store and cooking lessons are taking place they end up with a very different store experience.
“It’s about reminding people that they shop at a particular grocery store because there’s always something new happening or they are surprised with some special offering or different sampling,” he said. “Basically, you’re trying to reposition what that shopping experience is really like and giving the store the element of surprise.” ■