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Main takeaways from the Checkout Conference 2018

Main takeaways from the Checkout Conference 2018

Posted by Maria Diaz on Feb 19, 2018 5:58:48 PM

“2020 and beyond: Strategic planning for the next decade” was the topic that gathered 12 experts at the Checkout Conference 2018, which took place on February 13th at The Intercontinental Hotel.

During the Conference, the experts discussed the future of Irish Retail, FMCG, Private Label, Packaging, E-Commerce, Logistics and Loyalty Share. At CPM we have gathered some of the main highlights of the day:

  • Food and retail expert, Joanne Denney-Finch OBE, Chief Executive of the IGD, offered key insights on the big trends affecting grocery retail and what they mean for the Irish market. She based her presentation on the topic “Dealing with disruption” and the 3 key elements that she has identified to survive and thrive in a disruption era are:
  1. Continue having the basic standards high. It’s important to have a team ensuring that the golden rules of your business work extraordinary well, while another separate team are dedicated to innovate. “Do the ordinary extraordinarily well, and consistently”.
  2. Harness the forces that are vital for change. By now we have all heard about the new technologies being used by businesses such as AI, voice control, augmented reality, virtual reality, among others. Joanne offered several examples of companies and retailers that are already deploying these technologies successfully, which have many benefits for consumers such as time saving, redirect to other products that consumers will enjoy, and maximum convenience while going about your daily routine.
  3. Agility: copying with the unexpected. The phrase by Lee Child “Hope for the best, plan for the worst” becomes very pertinent under this element. It’s important to become adaptable business coachers.

Joanne also shared that the retail of the future will have a more individual character (no lines and category separated display units), with products being showcased rather than large amounts of stock being held in store. The consumer won’t see the difference between online and off line retail, they’ll perceive it as a seamless experience. As a brand, it is important to define what retailers they are going to target, what technology partners they will get involved with and where will they fit in the store of the future.

 

  • Robbie Clark, Director at Empathy Research, described the shopper of the future and identified the key behavioural trends of the modern shopper. He identifies 2 predominant groups, one under 34 and other ages between 35-44.

He also shared the key Drivers of change for the shopping experience of the future:

  1. Time: Time will be considered as the asset of the future. In that sense, it’s expected that the shopping experience will be easier. At the moment, only 12% of consumers claim to love grocery shopping, with 47% describing it as a chore. So consumers will be very interested in technologies and services that will deviate that concept of shopping as a chore. Among those technologies are food delivery at work or home, appliances that remind them when they are out of a product or even to order products automatically. Moreover, 46% of consumers are interested in subscribing to a service which delivers the exact ingredients needed for a meal and 37% are interested in subscribing to a complete meal solution service. But this is not only a thing of the future. The shopping habits of those aged under 34 have changed in the past 3 years, with 51% of these shopping more frequently than they used to.
  2. Experience: As Robbie describes it, the shopper of the future is looking for a Fast and/or Fabulous experience. Currently shoppers don’t like shopping for 2 main reasons: they don’t like the queues and it’s too time consuming. 41% of all adults want to use technology more to make their lives easier. They are looking for more of a Market Experience In-store, with less processed food. 44% of consumers agree that supermarkets need to become more a food market and 41% would prefer to buy in smaller shops. 42% of consumers are interested in shopping online in the future. In summary, grocery shopping needs to become something shoppers look forward to, with a seamless use of technology.
  3. Sustainability: The shopper of the future is more socially concerned, looking for a more holistic and transparent approach from their retailers and brands. 87% across all age groups agree that supermarkets should make sure any leftover food is donated to charity. Already consumers are taking sustainable measures such as recycling food waste at home (67%) and 65% have reduced the amount they buy to cut down on food waste. Shoppers are aware of what they do at home with their waste and would like to know more about the initiatives from their retailers.

Also buy local is a big thing for the shopper of the future. 67% try to purchase food which is produced in Ireland or as close to Ireland as possible. The source of the energy will be very important with 41% of those aged under 34 would be more likely to shop in a store that used sustainable methods to power it. Last but not least, shopper of the future will move away from meat. 19% of consumers would classify their diet as one which focusses on primarily trying to eat vegetables. 19% of those who currently eat meat are likely to reduce their meat consumption in the next 5 years.

 

  • Patrick Munden, Global Head of Retail and Marketing at Salmon, examined the digitally-obsessed shopper. They could be described as consumers that make almost all purchases online and are very excited for future developments such as AI and VR. These shoppers are predominantly male (64%) and 52% are aged between 25-34 years old. 49% state they could not comfortably live without connected devices and 66% say they will increase their use of digital shopping channels in the future. They crave innovation and want to know what are the latest technologies. 15% of shoppers are digitally obsessed, 50% are digitally curious.

Patrick also spoke about Programmatic Commerce, which is the phenomenon of connected devices making purchase decisions on behalf of consenting consumers and businesses based on pre-programmed paraments and learned preferences. As more and more consumers are looking to use this technology, brands are raised with a new question: “How to market their products for an interface?” In the near future, brands will need to market their products to an algorithm. 53% of consumers would be more likely to shop at a retailer who is digitally innovative but 60% wish retailers would be more innovative in how they use technology to improve the shopping experience.

 

As a summary, the shift in consumer behaviour is happening due to a real desire for shopping innovations, willingness to let purchases take care of themselves and want to shop with innovators.

 

  • Kevin McCarthy, Managing Director at Garvey Group focused on how to build a successful strategy for an independent retail business, showing how Garvey’s has strategically planned, changed and innovated over the past 5 years and how they are preparing for the customer of the future. When identifying a strategy, it’s very important that retailers think outside the box and take into account the increase in the life expectancy and the focus on healthy options, the importance of online shopping, as well as how to leverage new technologies such as electric car forecourts, delivery by drones and wearable technology.
  • David Ciancio, Senior Customer Strategist at dunnhumby, looked at how big data is giving consumers a voice and what they are saying. David emphasise the importance of consumer loyalty however only a few brands are successful in gaining it. This means a massive opportunity to grow and how brands should show their loyalty to their customers instead of seeking it. In that sense, the traditional ways of thinking and marketing to consumers need to be revised. The store is a very unfriendly place for shoppers with normal supermarkets displaying an average of 45,000 SKUS. Perhaps that explains why shops like Aldi & Lidl has been so successful, as they display around 1,500 curated SKUS.
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David also dismantled some common myths in retail around consumer loyalty, price sensitive shoppers and customers needs being different in different regions and countries. (See picture)

 

The tactics for 2020 include that the traditional marketing funnel will evolve as brands need to understand the mindset of the shopper and create & share a common shopper language based on big data. Retailers need to take actions to make the shopping experience more human and personal for consumers. Technology dissapoints consumers, but a personalised experience won't.

 

  •  Wijnand Jongen, Retail and e-commerce expert, answered the question “Is it the end of online shopping?” throughout his presentation. He insisted that retailers should no longer try to fit the customer in to their environment; they should fit in seamless in the life of their customers. Online and offline are becoming one thing which he likes to call “onlife”. We are at the new “onlife” customer journey tilting point in retail, merging online and offline retail. A great example of this is the WeChat app in China. According to Wijnand, the change is not being driven by technology but by the consumer behaviour. Also, he highlights that channels and business models are flowing together, with players assuming new roles (Google becoming a retailer or Amazon covering from ordering to delivering).

  • Black-532446-edited.jpgClive Black, Head of Research at Shore Capital, shared his perspective on the Irish grocery market from the other side of the Irish Sea including his assesment of the various chains operating in the Irish convenience space. He mentioned how discounters like Lidl and Aldi have been very effective to appear local when they have a pan European approach. They represent a primary example of how they use the recession to grow. On the convenience channel, shoppers will do more trips with smaller shopping carts and Food to Go will grow more than grocery. To summarise, understanding people needs will drive the future of retails.

 

  • Steve Wynne Jones explored some of the latest trends and innovations from across the European retail sector and looks at what Irish grocers could learn from their continental neighbours
  1. Example of interactive shops:
  2. Examples of shops that celebrates individuality:
  3. Examples of new products and new concepts that really stand out:

 

  • Loe Limoens, Managing Partner at Yellow Dress Retail looked at design trends in the retail sector, with a specific focus on private label and predictions for the online future of packaging. Loe explained why product design is so important as visualisation of the product is what the consumer chooses in the end. 

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He highlighted that one of the reason why private labels have been so successful is due to their minimalistic design and the brand is over the background.

 

In the digital area is important to look at redesigning package as in 2025 50% of all products will be bought online. Brands should look at an “E-pack” that works well on the screen.

 

To close off the Checkout Conference, there was a great panel discussion with key insights from Kevin Donnelly, Managing Director at Britvic Ireland; Nick Johnston, Managing Director at Unilever Ireland and David Adams, Head of Sales at the Kraft Heinz Company.

 

CPM works as a strategic partner with all of our clients. We work closely with them to ensure that we are constantly reviewing the emerging trends in the market and in turn growing and evolving.

If you would like to talk to someone at CPM about how your brand can evolve with these changing times in Retail please contact us on 01 7080300, email info@cpmire.com or visit www.cpmire.com

Topics: FMCG, Retail, retail trends, Checkout Conference