It’s no news that our digital landscape is evolving, but it is fascinating to see how our common experiences are becoming digitized. There may not be anything more traditional than grocery shopping, yet digital has not hit critical mass in the supermarket industry like it has in other industries. Sure, FreshDirect has been in NYC for 12+ years, but why has their reach not expanded across the country? PeaPod.com has aligned with more traditional retail brands but still has not expanded nationally.
Is the secret a more customized digital experience? Grocery delivery upstart BlueApron.com, specializes on sending recipes with the exact quantity of ingredients and it seems to be a success. Their reach has expanded roughly 2/3rds of the US covered (and likely 80% of the population) due to it’s ability to package complete meal contents into shippable boxes.
Just as Amazon destroyed the brick & mortar bookseller industry, Amazon is injecting digital innovation to the grocery industry with it’s latest Dash gadget, allowing people to scan or dictate into a microphone the items they need to order. Amazon’s distribution network will provide a force in this market, especially once the “Internet of Things” trend is truly realized (e.g. your refrigerator automatically ordering the milk you are running low on). If traditional grocery chains don’t immediately start integrating the type of conveniences some of these upstarts have built into their digital customer experience, they will find themselves in the same place as other traditional industries such as booksellers have but with a faster pace of change. Additionally, risk is higher for traditional retailers because the same customers who shop at grocery stores likely already shop at Amazon, likely already have a mobile smartphone capable of barcode scanning, and likely already use online services with amazing customer experience. Grocers should quickly acclimate themselves with the digital trends relevant to their business, benchmark their digital experience and rapidly prototype digital experiences they could bring to their customers that would differentiate themselves from what Amazon can’t do without a physical presence.