A three-day festival of all things grocery, CPG, and e-commerce, the inaugural Groceryshop conference brought together more than 2,200 attendees to discuss innovation, disruption, and more.
Among the more than 180 speakers and presentations, one message became abundantly clear: the grocery business is in the midst of a radical reinvention, spurred on by disruptors like Amazon/Whole Foods, as well as significant changes in consumers’ shopping habits and expectations.
Or as Mike Molitor, head of eCommerce and customer loyalty at Raley’s Supermarkets put it, “Today's shopping trip in a traditional brick and mortar world just has way too much friction. And that’s why the shopping cart is dying.”
But it wasn’t all doom and gloom in Molitor’s Groceryshop talk on building customer loyalty (although he was dressed as Batman villain The Riddler (don’t worry, it was Halloween)). Molitor pointed to Raley’s development of a Relationship Commerce platform that’s bringing their grocery business into the 21st century.
Building loyalty through true relationships, not promotions, points, and rebates
“The core principle of Relationship Commerce is about moving from episodic, promotion-based interactions, to a different paradigm of proactive, ongoing, and more predictable customer-centric relationships,” Molitor said. “Building loyalty through true relationships, not promotions, points, and rebates, but really developing a relationship with your customers.”
Step one for many retailers embarking on a Relationship Commerce strategy in the grocery space is setting up a set-it-and-forget-it program -- making it frictionless for your customers to get what they need, and creating highly predictable demand cycles for the retailer. But effective Relationship Commerce goes well beyond that.
“Auto-replenishment is one thing,” Molitor said, “but we want to take it a step further where we proactively reach out to the customer and say, 'Hey you bought these meal kits two weeks ago, did you like them? Oh, by the way, let us make it really easy for you to reorder.’ That's way different than sending a promotion and trying to get them to re-engage.”
Text-related commerce is still in its infancy...
Retailers also need to start engaging customers on the communication channels they’re already using. Case in point: how do retailers reach the enigmatic millennial? “I have a 16-year-old daughter,” Molitor said, “and all she does is text. Yet text-related commerce is still in its infancy. Retailers haven't figured out how to use text as a mechanism to engage and actually do transactions, and i think that's going to be a massive opportunity going forward.”
“Where does a 500-pound gorilla sleep?” The Riddler asked Batman. Answer? “Anywhere he wants.” Consumers are going to shop anywhere they want, and their options keep growing by the day. Unless retailers start building out their Relationship Commerce tools today, they’re going to find they don’t have many customers tomorrow.