Kroger has been testing out digital “smart shelves” since at least 2014. Using your phone or a store-provided handheld device to scan your groceries as you go is something Kroger has been tinkering with since 2009. And QR codes have been around so long, they’ve already fallen out of favor, come back into style, and may be on their way out yet again.
But combine all of these newish technologies into one store, and what you do have? The “grocery store of the future”!
Kroger and Microsoft have earned plenty of buzz this week, after announcing a partnership they plan to formally unveil at this weekend’s National Retail Federation trade show. The two companies have collaborated to create two “stores of the future” – one, a Kroger location near that company’s headquarters in Ohio, and the other a Kroger-owned QFC store near Microsoft’s headquarters in Washington state.
Various news reports on the partnership have portrayed it as Kroger’s answer to Amazon Go. Amazon’s own “grocery store of the future” features strategically-placed cameras, which allow you to walk in, grab what you want, and leave without even stopping to pay. Everything you grabbed is captured on camera and is automatically charged to your Amazon account.
Kroger’s “store of the future” is somewhat less, well, futuristic.
Using the Kroger app, you can create a grocery list and then head to one of the test stores. Once in the store, your phone or a Kroger-provided device will tell you where in the store you can find each item on your list. As you walk down the aisles, instead of paper price tags, you’ll see digital displays on the shelf edges that feature prices, promotions and ads. When you approach the next item on your list, the price tag in front of it subtly changes to a personalized icon so you know where to find it. You use your phone or scanner to scan the item’s bar code as you add it to your cart, and you can scan a QR code on the shelf edge to access digital coupons on the Kroger app (though you still have to scroll through them all to see if there’s a coupon for any of the items on your list).
Compared to walking in, grabbing what you want and leaving, this “grocery store of the future” seems like a little more work.
Kroger CEO Rodney McMullen described the system with dramatic flourish, promising that it would “reinvent the customer experience”, “redefine grocery retail” and provide “personalized food inspiration”.
The digital shelves are, perhaps, more beneficial to Kroger than to shoppers. Changing prices and highlighting promotions can be done with a few keystrokes, instead of swapping out paper price tags throughout the store. It also provides Kroger with a new revenue stream, by allowing it to sell advertising space on the shelves. In theory, advertising can even be personalized, based on what items are on your shopping list – as you reach for your item, an ad could show up recommending a complementary product.
Overall, the new effort is the latest example of the country’s largest traditional grocery chain scrambling to keep up with the threat from online shopping, and out-of-the-box ideas like Amazon’s. Kroger is already experimenting with grocery delivery via driverless cars. But some say Kroger’s increased focus on shiny new objects could be causing it to take its eye off the ball – the in-store experience.
Kroger is often ranked in the middle of the pack, in customer surveys about the best grocery stores. Its stores are generally seen as okay places to shop – nothing fancy, often a little cluttered, but they serve their purpose.
Others are somewhat more critical. Contributors to the industry discussion site RetailWire recently discussed Kroger’s increased digital focus. One said Kroger’s innovations are coming at the expense of stores that “feel run down and dispiriting”. “It’s definitely important to be innovating and moving forward, but Kroger may find themselves in trouble if they don’t look to their stores as well,” another commenter offered. “Kroger’s in-store customer experience appears to be on a downward slide. Focus on the basics,” another advised. “Digital is a shiny impediment if it means sacrificing the store.”
So keep an eye on your local Kroger to see if it might be next to transform into a grocery store of the future. In the meantime, it seems Kroger might do well to ensure it doesn’t forget about its grocery stores of the present.
Image source: Kroger
