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Exploring the Future Of Loyalty At Grocery Shop 2023 (ft. Steve Gunnell & Danielle Faricelli)
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In this episode, we reflect over the Grocery Shop 2023 Event, and explore the future of grocery shopping with Steve Gunnell, Account Executive at Emarsys, an SAP company, and Danielle Faricelli, Sales Executive at Annex Cloud. Tune in to learn how to recognize and incentivize valuable shopper actions, uncover individual and household preferences, and use personalization to create a more engaging and rewarding shopping experience.
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Transcript
Introduction to Personalized Customer Experiences
00:00:10
Speaker
Get Personal with Loyalty, where we're discussing using loyalty to deliver personalized, relevant customer experiences. Hello, everybody. Welcome to the next edition of Get Personal with Loyalty. Today, I'm here with Danielle Ferris-Selly, a senior account executive here at Annix Cloud, and Steve Ganel, a senior account executive at Amarsus, which is an SAP company. Hello. Hi, Erin. Thanks for having me. Hey, Erin. Good to be here.
00:00:39
Speaker
So we're here today with Danielle and Steve because they were fortunate enough to attend grocery shop. They were there promoting the SAP, Amarsus, Annex Cloud, grocery, customer experience, and loyalty solution. They learned a whole lot about what's going on in the industry and have a lot of insights to share with us today. So I'm super excited to dig in and hear what you guys learned.
00:01:01
Speaker
Yeah, no pressure. No pressure. Not at all. So let's make it easy. Let's start with some of the broad themes. So what were some of the things you guys heard? What kind of trends were being discussed as we were getting ready for this? I know Steve,
AI and Geolocation in Grocery Personalization
00:01:17
Speaker
you had mentioned something about AI, which is obviously on everybody's mind right now, which I just start there.
00:01:22
Speaker
Yeah, sure. I mean, for me, it was just an in-your-face kind of theme that I think we've been seeing AI all over the place, whether it's in the grocery industry or anywhere else. But there were some really interesting applications for the AI with regards to helping grocers identify and kind of measure their customers in a way that I think they intend to provide a better customer experience.
00:01:51
Speaker
We saw some technologies being offered at grocery shop like a remote.
00:01:56
Speaker
video application that would assess you as a shopper by your facial expressions, your motions of your body, body motion, behavior and assess not only just your age, but also a possible demographic. So you could find out, is this a 50 year old guy that is a very conservative shopper or is this a
00:02:21
Speaker
30-year-old impulsive guy. And we had fun with that because, you know, we tried to emulate different demographics when we were there, and I know Danielle, for instance, worked her age down, right, from, I think, 39 all the way down to 29 with a few tries, so she did a great job of emulating a younger shopper, which, I mean, it was fascinating, the way that it mapped to the face and whatnot, but these are things that, you know, data that AI is using to understand or assess like a person would, like a...
00:02:51
Speaker
Like if somebody at the counter would say, hey, I know what kind of person you are or tell me what kind of person you are and assess that and then kind of offer the next best thing for them. So I thought that
Privacy Concerns in AI-driven Promotions
00:03:01
Speaker
was a really neat application. I don't know, Danielle, they talked about a bunch of other AI type things. I don't know if anything comes to top of mind for you.
00:03:08
Speaker
Yeah, so to take that a step further, right? So in terms of digitizing the store. So yes, the digital smart screen. So some of the technology that these grocers are starting to launch that are tied to the geolocation on your phone. So OK, you know I'm 28. You know I'm an impulsive shopper.
00:03:33
Speaker
And I have your app on my phone and the geolocation is turned on. I'm walking down the aisle and suddenly they know that, OK, this person is probably going to want this product based off of previous shopping cart behavior, and they're going to offer on the screen to me a specific promotion that's going to drive my behavior to grab that item off the shelf and think it's a good deal. So that's something that I thought was super interesting.
00:04:03
Speaker
at the conference. Yeah, for sure. So can I, let me ask you guys some questions around that though. First, how creepy is that? Did they talk at all about opting in to that? So if you're in the grocery store, you're in, I'm assuming you're in an aisle and they're making this assessment of you. Do you know?
00:04:22
Speaker
It wasn't evident from any of these technologies that there was going to be some sort of opt-in for this. I think that, like all AI, we're going to see tons of iterations of this and how they use it. Clearly, the application I was describing came from kind of a behind-the-scenes perspective. And it may or may not be used immediately for that kind of advertising that Danielle just mentioned. But
00:04:49
Speaker
They're absolutely, you know, we had conversations with a pretty well-known coffee retailer. And, you know, they're interested in tying loyalty together. They do it well in their stores now. They don't do it very
Consumer Privacy vs. Personalized Offers
00:05:05
Speaker
well with the online to offline, but they also want to incorporate loyalty with
00:05:10
Speaker
the experience in the grocery store, whether it's Kroger or Safeway or what have you. And so to that point, the app is an important component of that and the ability to geofence there and learn from people that, you know, they're in this store at this time of day and they, you know, we may or may not get to that point where like Dean Daniels talking about like, hey,
00:05:33
Speaker
They're down, they're down the, you know, cereal aisle. And let's go ahead and put Frosted Flakes in front of them. I think it's almost like, I don't know, Danielle, I think it's gonna be implied when people download these apps, they're loving your brand, right? They're loving your brand. They're gonna, they're gonna, you know, imply consent, you know?
00:05:52
Speaker
Yeah. And it, and it's, is it creepy or is it something that adds value to me as a consumer? I do, you know, it's like how much of my data or my, this is the debate always, right? Like how much of my privacy will I trade for value? And, you know, obviously this is going to continue on in the industry, but for me as a consumer, if I can get, if I can kind of stick it to the man and get a good deal, I mean, maybe that's just me. I'll let you videotape me.
00:06:22
Speaker
me. Fine. I'm just walking through this door. I have nothing to hide. Yeah. But you know that's some people are into that. I like that. Go on Steve. No I mean I think it is. It's like if it adds value and I think there's going to be different demographics right. Some people are going to think it's creepy. I think you're right Aaron. It is going to be creepy. But that's just like all the other technology that we have. Some people choose to be communicated this way. And I know 10 years ago when people started
00:06:47
Speaker
You know, SMS messaging with marketing. That was like a big no-no for a lot of people. Go, no, don't do that. But if you're an 18 or 20 year old right now, you expect to get the SMS marketing messages that you've opted in. You have zero problem with that boundary being crossed. Especially because you have no idea where your email inbox is. Correct.
00:07:09
Speaker
But I love the discussion, and I think you're right. And then thinking about pulling back to our joint solutions, being able to have loyalty consent. So if you've already given consent to be communicated with or capturing the data as part of a quote unquote loyalty program, then it
00:07:30
Speaker
Does it matter that they're digitally understanding that or understanding where you are in proximity within their store or proximity to certain items? It's
Sustainability and Brand Loyalty
00:07:41
Speaker
just taking that loyalty consent to a whole another level that we weren't able to track before. I love that one, guys. What other trends and things did you hear about while you were there?
00:07:51
Speaker
I was going to say I think right. So influencing the purchase journey through utilizing A.I. But then you know the idea of the generative A.I. and being able to collect preference data.
00:08:07
Speaker
and then create an output for that specific user. So as a member of a loyalty program for a grocery store, saving me time to, based off of my dietary and flavor preferences, telling me what I need to put in my cart. Like basically just having it mapped out for me that I don't even have to think about it. And so there was talk about unlocking those types of generative AI features in the apps and beyond.
00:08:37
Speaker
Another underlying theme I think that was pretty relevant, a lot of different areas. And I don't know if it's because my guy brain was thinking over time when I saw a lot of the technologies that were offered there, but there was a lot of sustainability discussion. And that ties into where are we from an empathy perspective with our customers? What are we showing? How are we bonding them? And I think that sustainability is like table stakes, right? And so these companies,
00:09:02
Speaker
are saying, hey, we're promoting this, but let's put our money where our mouth is. And I saw a lot of technologies where companies were promoting reduced use of refrigerants, and that helps the global warming kind of thing.
00:09:18
Speaker
And of course there was the organic and recyclable packaging and whatnot, which was kind of neat. And I don't know where the adoption is on that with these grocers and whatnot, but it was definitely at the forefront of how to be less impactful to the environment. And I think that that ultimately connects with the consumer. And that was definitely a prevalent theme there.
00:09:39
Speaker
Yeah and that's a good point Steve because sitting in on one of the main stage discussions there was a lady from Central Garden in Pet and she was talking about loyalty and the idea of stickiness and yes like how do you create a program that is a little bit more sticky to
00:10:04
Speaker
your members, and it's not necessarily just around the points. It's about what does the brand stand for? Do they have purpose and meaning? And I think sustainability, that message is pretty powerful in creating that sentiment. So the customers do say, yeah,
00:10:23
Speaker
You're right. You guys are doing great things here. I trust you. I see the quality and I see the positivity that you're bringing forth into the industry and I want to stick by you. And so I thought that that was interesting and really tapping into the emotions of their members through that. And so sustainability is a way that brands can do that.
00:10:46
Speaker
It's really interesting. And when you think about it from a grocery perspective, there's different levels, right? There's there's how as a grocer, how do I want to be perceived by my customers? But then there's the choices of the brands that I'm putting on my shelves. Do they have the same beliefs that
00:11:04
Speaker
that we're setting forth. And I wonder how much of the grocers are they thinking about that as well. I mean there's obviously organic sections right. There's certain areas but then there's also the grocers that can sell everything. I wonder if there's how they're deciphering that would be kind of interesting as well. I know actually SAP has a product don't you. I'm green token.
00:11:27
Speaker
and I think it's still very much probably in beta. My understanding of what it does is different consumer packaged goods organizations can get this green token and then be able to track
00:11:41
Speaker
the path of the packaging through from its very beginnings to how it ended up on your shelf. So it really pushes that sustainability aspect. And if a consumer wants to know
00:11:58
Speaker
how this packaging came to be, they can hit a QR code or something. Do I have that right? Steve, are you familiar? Yeah, yeah. ESG, the environmental, social, and governance stuff is also, it's just like the AI. It's all the talk. It doesn't matter what industry you're in. That green token, you can track.
00:12:18
Speaker
you know, the raw material source and whatnot. So now my counterparts from SAP that were there had many lovely discussions about that. I wasn't a part of those, but yeah, there was, there was just a tremendous focus at the show on supply chain technologies and supply chain environmental awareness and whatnot. So it's, it's, it's, it's big, it's big.
00:12:43
Speaker
It's happening everywhere. Not to digress from grocery, but I know I was taking a flight and book my flight. And now on United's app, they'll tell you which is the most eco-friendly flight to be taking, which one is putting off the least, the least emissions. So you can select to be on a more environmentally conscious flight. Yeah.
00:13:07
Speaker
which is very interesting. It's everywhere. To get us back to grocery shop and the different trends. I know, Danielle, when you got back, you were talking to me too about one of the things that you heard around theft. Yeah. And so how it's a huge problem and how are organizations attacking that or is it more just building awareness at this point?
00:13:31
Speaker
Yeah.
Challenges and Innovations in Physical Stores
00:13:32
Speaker
So I think I heard a statistic that Target was on track to lose about a billion dollars this year, or it might've been next year on theft alone. And so that was something that brands and grocers were trying to combat. Now, I don't, you know, whether that's closing down stores in different markets and focusing more on the online business, right? Doing the P&L on that.
00:14:00
Speaker
And then also, like you said, driving the awareness. So, you know, even through legislation, what what can what can we do? What can be done here? But yeah, the idea of kind of maybe driving more offline or I mean, online engagement versus in store for some of those markets. So that was something that was definitely on the forefront. Very interesting. I had no idea. I mean, no, I've heard about it on the news, but I had no idea it was that big.
00:14:30
Speaker
It's certainly something that every time we have a conversation around loyalty, fraud seems to be a much bigger conversation than it was five, 10 years ago. It certainly is something that we all need to be watching.
00:14:43
Speaker
And then I think one of the other trends you'd mentioned was the next generation of physical stores. Is that really hitting what you guys were talking about? Or is that also maybe taking another level of more omni-channel experiences and including media and such as well? I mean, I think it does. I mean, we saw like, again, it goes back to some of that AI and the merchandising learnings that you can take away from
00:15:12
Speaker
monitoring and analyzing behavior in the stores. But I mean, we saw a lot of technologies where the self-checkout kiosk, right? Like 10 years ago, nobody was bagging their own groceries, right? And now it's like a big component of the experience. So you saw a lot of that.
00:15:30
Speaker
focus on those areas with companies. I don't know what the adoption is for that. Personally, I don't see it there. I saw them talking a lot about it at the show, but I don't know who's executed on that yet. I don't know, Danielle, did you see anything? I mean, as far as next generation physical stores?
00:15:48
Speaker
Well, so there was the concept of the discovery smart carts. So having carts that right, I think tailor to your preferences and dietary restrictions and send messages based off of that. But Kroger did mention on one of the main stages, they were talking about
00:16:07
Speaker
the balance between tech and human connection. So to your example, Steve, the self checkout versus the actual physical person checkout. And so companies are, or grocers are very much trying to consider that as well. Where's the line? There's a fine balance, right? Because we do still want the store to be about a sensory experience. And sometimes that sensory experience is your inner
00:16:32
Speaker
action with the employees. And so that was definitely that a theme that he was talking about during that session. That's interesting. I heard somewhere that there is a that someplace I want to say it's not here in the U.S., it's in other countries where some grocers have adopted a slow lane, something like that. And it's for people that want to have a conversation when they're at the grocery store.
00:17:00
Speaker
So maybe it's social lane. It's low lane or social lane. It's something like that. And so you can come in and you take that checkout line. The line's probably going to be a lot longer, but you can talk to the people in line and then you can talk to the person at the register. And it's all about making sure that, you know,
00:17:15
Speaker
you're having that human touch experience because you're certainly coming out of COVID and so many people didn't have that. So it's interesting, the stores kind of have to balance the people that want to just fly out of the store and making self-checkout.
00:17:31
Speaker
much better experience than it was 10 years ago when it didn't do everything you put through and buzzed. Put the bag back, put this back. It's better now. But making that efficient while also the customer that does want to have that contact and especially in an environment where it's similar to like a QSR of a restaurant, you just want to move through quickly so that you can service more customers faster.
00:18:01
Speaker
Yeah, it makes me think I was in Trader Joe's the other day. What would Trader Joe's be as a brand if you weren't in the checkout and the cashier is commenting on every single item of food that they're scanning? Like I had my orange chicken, mandarin chicken, shamefully. I had two bags of it and they're like, oh yeah, this is great. This is great. And so it makes you laugh, right? It creates this fun experience in store, so.
00:18:29
Speaker
So
Loyalty Programs and Shopping Rituals
00:18:30
Speaker
Danielle, when we were prepping for this, you talked about a gentleman, I think you said from Giant Foods that was talking about rituals. What was that all about? Yes, I found this very interesting because I'm a big proponent of rituals in both my personal and professional life. And so I believe it was the head of loyalty and
00:18:52
Speaker
the conversation was around the industry as a whole suffering from quote unquote a recession and how do they navigate through that right now as basket sizes are kind of decreasing in store and so
00:19:12
Speaker
the idea of creating that emotional bond and ritual between the brand and the grocery store to drive customers into the store. And so what does that look like? And so thinking about
00:19:32
Speaker
different ways that they can use loyalty to create that ritual. So an example that Giants Food was talking through was about converting some of their tertiary customers to more loyal customers. So a customer would come in one time a month, buy a carton of milk and get out.
00:19:50
Speaker
So how do you convert them to be more loyal and come in more than one time a month? And then also put some other items in their basket. And so by creating this offer that loyalty members, once a month, they are offered a coupon for a free private label product. So the example I have in my personal life is Peace. I'm a member of the food co-op here in Seattle.
00:20:19
Speaker
And I get an offer activated every other week. It's either free berries, a free OJ, and it drives me into the store. And I'm like, okay, I'm gonna get my free berries. What else do I need here? And I think that just offers a lot of value. And it creates that I'm ritually going in there every other week to get my free product, whatever that is. And I thought that was pretty cool.
00:20:47
Speaker
I really like that. So I'm a big fan of the debate of, is it better to have a habitual customer or an emotional customer? And I really like the habitual one because it's just happening. It's on autopilot. They just keep coming back. Emotional to me is, hey, you might have a great emotional bond, but you're more emotional. So that can go sideways on you, potentially, somewhere along the lines. But it's certainly a great debate.
00:21:15
Speaker
And I like the concept of a ritual. It makes it sound a bit better than habit. And I like the trial aspect that you're talking about too. If they know who you are, they can suggest and sell different items that are really interesting or could be very relevant to you too.
00:21:32
Speaker
Yep. And then on top of that too, not even just items, but what about experiences? There is a grocer that does a really good job of creating that experience for their members. They have once a month hooking classes. So it's, you know, once a month people go in, they in-store, they have this back area, they have a chef.
00:21:54
Speaker
teaching you some gourmet technique or some dish and people look at that and they're like okay this is awesome like once a month date night right like what do I want to do on a Friday night I'll do my cook and then you're in the store and you're going to make some purchases to recreate that dish at home yeah yeah it's funny to think like some of that some of that in-store
00:22:19
Speaker
warm fuzzy feeling is are things that digital marketers have been doing and loyalty platforms have been doing for a while now. We kind of are almost a foundation of intelligent e-commerce where you're just
00:22:32
Speaker
you know, suggesting, you know, people like this and buy that, how about you, you know? And, you know, when you
Digital Integration in Physical Shopping
00:22:40
Speaker
talk about like e-commerce product recommendations, you know, on the site or in an email or your mobile app or whatever, you know, you're giving ideas to people digitally to, you know, to gain a conversion. And what you just described there is a great customer experience. It just happens to be brick and mortar and they may convert a few more sales out of it, you know?
00:23:02
Speaker
Well, I think that goes back to that whole combination of the merging the digital and reality or the brick and mortar, because we all know that.
00:23:11
Speaker
certain stores people are on their apps looking or in their phones just to try to figure out am I getting the best deal. You can buy these jeans somewhere else for the same price. I don't know if they're doing it in the grocery store as much but it's there and it's something that happens often. So we're able to use that instead of potentially driving them away from the store or bringing them in.
00:23:32
Speaker
and inducing more trial of more items and more things. I think that makes a lot of sense. I also still love the idea of having your kind of your grocery list too, whether you get it delivered or you're even in the store with it, having that digitally and having some additional suggestions pop up with that. And Danielle,
Conclusion and Further Exploration
00:23:50
Speaker
I think the having the chef and having a cooking class within the grocery store is a phenomenal idea. We don't see it much here in Chicago, but certainly I think a push that could be really, really interesting.
00:24:01
Speaker
Thank you both for the wonderful discussion. Lots to learn. Sounds like it was a great event. As we begin to wrap this up, any last thoughts for the audience or thoughts around grocery shop or what brands can be doing to elevate their experience?
00:24:18
Speaker
Yeah, thanks, Aaron. I would just say that there's just more and more technology that's going to be thrown behind these grocers to give us a better experience. And if you're a marketer in that field, you know, there are many, many tools out there. I would like to think that a Marxist and Annex Cloud are two of the
00:24:39
Speaker
premium platforms that you can use to leverage all that data that's going to come in from customer experience and to track and reward your loyal customers across channels. So yeah, I would think that we're here to help and you want to give us a call. Great. Yeah. How do they do that, Steve? How do they get ahold of you? You can reach me at steve.ganel at marcis.com. That's Ganel with two N's and two L's. Thanks a lot.
00:25:09
Speaker
Terrific, thank you. How about you Danielle? Any parting thoughts? Yeah, so I would say plus one to everything Steve just outlined and also it's just a really interesting time to be in the grocery industry and I'm really curious to see how this all pans out over the next you know 5-10 years and how it changes as a consumer, how it changes our experiences and
00:25:37
Speaker
And yeah, absolutely. You know, loyalty and customer experience is, you know, on the forefront of that. And yeah, just very excited to see what to come. Terrific. And how do people get a hold of you?
00:25:52
Speaker
So yeah, you can find me on LinkedIn, Danielle Ferris-Selly or dferris-selly at annexcloud.com. Great. Well, thank you both so much. I really enjoyed the conversation and learning more. I wish I was able to go. Next time. See you there. There we go. Thanks, Aaron. Thank you. Thanks for listening to this episode of Get Personal with Loyalty. Join us next time for more Loyalty Insights. Until then,
00:26:19
Speaker
Dare to dream. Let Annex Cloud help make your dreams a reality. Visit annexcloud.com. See you soon.