The grocery retail industry experienced growth during the booming economy of the pre-pandemic days, as well as during the pandemic shutdown, when eating at home became the norm. But post-pandemic consumer shopping behaviors and preferences are changing rapidly amid unprecedented inflation and as product availability stays sketchy due to the fragile global supply chain.
To meet challenges to growth, grocery retailers must focus on leveraging data to innovate and respond to key customer imperatives. Whether shopping online or in-store, consumers want a more seamless and personalized experience, more opportunities to save more money and efficient access to the products they love across the omni-channel.
With the right data and the right tools to make the most of it, grocery retailers will be prepared to satisfy these needs. They’ll be poised to deepen personal relationships with customers to increase frequency and basket size through upselling and other techniques, such as promoting big deals on their private-label products in real-time to consumers who typically buy these items from brand names (and growing that business in the process).
In today’s environment, it’s clear that loyalty programs, memberships and subscriptions are more important than ever. Loyal customers attach to a brand or a store based on their favorable attitudes to the business, and longer-lasting relationships with shoppers increase customer lifetime value. Increasing customer retention rates by just 5% can increase profits by between 25% and 95%, and loyal buyers also serve as companies’ advocates. That can help reduce marketing expenditures for attracting new customers and improve organizational profitability.
But there is little differentiation today in grocery stores’ loyalty programs that really excite the consumer. Grocery retailers can break through the standard template to change that perception, and drive even greater loyalty by going beyond leveraging first-party customer data for insights. To deliver promotions, product recommendations and rewards that are unique to individual customers, they can tap into third-party data from sources such as InfoGroup and Equifax, location insights from PlaceIQ, and advanced analytics and AI models to capture more information about and understanding of a buyer’s preferences.
Embracing the data fabric
The right data fabric is critical to accelerating data discovery and analysis, supporting efforts to realize value from all data sources. Gartner has predicted that by 2024, data fabric deployments will quadruple efficiency in data utilization while cutting human-driven data management tasks in half.
Using the data fabric, businesses are able to integrate with and connect data from different applications and platforms, finding relationships that can lead to new insights and enable better real-time decisions that feed customers’ demands for true personalization in terms of products, experiences and delivery (curbside, in-home or in-store).
Not only can using this approach increase sales overall and drive revenue across the board, but it helps companies gain a growing share of individual consumers’ wallets as they become increasingly loyal patrons. At the same time, leveraging an enhanced data foundation with customer, sales and supply chain analytics serves to accommodate other purposes: reducing customer churn; expanding the customer base; driving greater productivity and cost efficiency; and improving supply chain performance and product assortment.
DXC has used our data and applied intelligence expertise in scenarios including helping one global retail customer realize 20% savings by reducing manual data analytics. By embedding data and analytics in digital commerce applications we delivered a 5% increase in online conversations for a leading retail corporation. DXC has incorporated process intelligence in applications, and processes savings on overall supply chain expenditure for a CPG customer.
Profiting from a technology and design combination
It’s our goal to deliver data-driven solutions to support the industry’s growth objectives with a human-centered approach to designing and building personalized and engaging experiences. That has a considerable impact on building a brand that customers trust and want to do business with, increasing loyalty and attracting a new audience, too. DXC also puts our years of engineering and modernization experience to work to help businesses differentiate their loyalty programs, modernize supply chains and more.
With our data and applied intelligence offerings, analytics and engineering services and human-centered design experience design, DXC makes it possible for grocery retailers to truly differentiate their buyer engagement strategy across the value chain. That’s a great recipe for customer loyalty.
About the author
Srini Kasthoori is a senior managing partner in the DXC’s Global Business Services organization, where he focuses on delivering business outcomes to retail and CPG clients. Srini has over 20 years of experience in the retail, consumer goods, travel, hospitality and leisure sectors, driving transformations of their digital and data landscapes, and their customer’s omni-channel experiences.