Introduction

The Coresight Research team attended and participated in the Groceryshop 2022 conference, held on September 19–22, 2022, in Las Vegas, Nevada, US. The event brought together retail leaders and industry experts from around the world to explore the changing grocery landscape and address current challenges. 

In this report, we present 10 key themes that emerged across multiple sessions and conversations during the four-day conference.

10 Key Themes from Groceryshop 2022: Coresight Research Insights

1.  The “Theater of Retail” Is Back

Prior to the pandemic, retailers often discussed the need to offer in-store experiences to build positive emotional relationships with consumers. In grocery specifically, discussions centered around offering live experiences such as food tastings or cooking classes. However, the pandemic put these conversations on hold as consumers’ health and safety became retailers’ paramount concern.

At Groceryshop 2022, retailers discussed the return to in-person experiences—a major indicator of recovery. Jason Buechel, CEO of Whole Foods, used the phrase “theater of retail” to describe excitement about new products and offerings, store designs and experiences. For example, Whole Foods’ Manhattan West store features a windowed butcher station where customers can watch the butchers work. 

Experiences are supported by technology that simplifies the shopping experience, Buechel emphasized, highlighting Whole Foods’ use of the Dash Cart smart shopping cart as well as technology from Amazon, its parent company. Buechel discussed Amazon’s One technology—which scans the palms of the customer’s hands to enter the store, identify them and collect payment—and Amazon’s “Just Walk Out” checkout-free technology, which Whole Foods has employed in two stores.

• Coresight Research’s BEST framework for retail excellence provides a model through which retailers can implement a consumer-centric approach to physical and digital retail, covering brand building, experiences, services and technology integration.

2.  Livestreaming Offers Grocers a Channel To Educate and Connect with Consumers

At Groceryshop 2022, Deborah Weinswig, CEO and Founder of Coresight Research, presented on the power of livestreaming and discussed its untapped potential in the grocery sector. She shared proprietary Coresight Research data insights, revealing that 63% of US retail companies that use livestreaming expect more than 10% revenue growth through the channel in the next two years, underlining the immense opportunity. 

Weinswig set the record straight on the perception of livestreaming as an emerging technology for retailers, noting its immense success in China, where livestreaming is currently a $497 billion market, Coresight Research estimates. While still in its nascent stage in the US, the technology is set to see growth from its current $20 billion market size to $57 billion by 2025, according to Coresight Research estimates—and the adoption curve could easily steepen if retailers and brands learn from the examples set by companies in the China market. 

Livestreaming is a key channel for brands to connect with consumers and provide product education. One major benefit is reduced return rates, as video hosts (which could include influencers or brand representatives) can test products in real time during a livestream, providing viewers with valuable information and a better understanding of the product before they commit to purchasing. 

Moreover, livestreaming presents a unique way for brands to interact with consumers and create an engaging community, cemented through exclusive offers and products. 

• Read more Coresight Research coverage of livestreaming e-commerce. 

3.  Food Retailers Shift Focus to Profitability and Sustainability (Reducing Food Waste)

This year’s Groceryshop featured considerably more discussions on efficiency and profitability than last year, given pandemic-led restrictions ending and consumers returning to physical stores. In particular, speakers discussed the profitability of various grocery picking—such as fully automated or conducted by the grocer—and delivery options, including home delivery and curbside pickup.

Related to profitability, food waste was another major theme of the event, especially at Coresight Research-hosted events, including the “Shark Reef” startup pitch competition (discussed in more detail below) and a luncheon with Avery Dennison Corp., a global materials science company, which featured a presentation on findings from our recent report, Overcoming the Food-Waste Challenge: Improving Profit While Doing Good.

Coresight Research also hosted a dinner alongside IBM, highlighting our recent report on blockchain-related sustainability opportunities, The Secret to Unlocking a Sustainable Retail Future Through Blockchain. At the dinner, the company discussed using artificial intelligence (AI) and other technologies to monitor food expiration dates starting in the field, ensuring food remains edible for the longest possible time.

 

4.  Startup Pitches Center on Fulfillment and Automation

Weinswig moderated the “Shark Reef” startup pitch competition, which featured 12 innovators across three areas of innovation. Whywaste, which offers an inventory management platform to help grocers and retailers reduce food waste, was selected as the Judges’ Choice winner. Vici Robotics, a robot-as-a-service company that increases retailers’ productivity via inventory automation, earned the Audience Choice award.

Coresight Research categorized the participating startups under three areas of innovation, with eight of the 12 competitors in the categories of fulfillment and automation. 

Product Marketing and Merchandising

• Brandcrush helps retailers buy and sell retail media, maximizing revenue from their owned media channels and increasing both consumer reach and brand awareness. 
• Jupiter integrates a creator-driven recipe and grocery shopping platform with the social commerce tools of Instagram and TikTok. 
• Peekage engages consumers through product testing and feedback to turn product experiences into actionable insights. 
• Shelfleet helps online brands rent shelf space by connecting them with brick-and-mortar retailers. 

Fulfillment and Sustainability

• Deliverider offers a marketplace tool that allows consumers to bypass shipping thresholds for low-priced items without the retailers having to hold those items in stock. 
• Lucky Labs developed and now maintains a platform that enables online brands to offer same-day fulfillment and in-store pickup through local retailers. 
• Lula Labs helps small retail chains, such as gas stations, to get online and manage prices for their SKUs. 
• Pipedream Labs is developing an underground network of pipes located in existing utility conduits for speedy, last-mile delivery. 
• Whywaste offers an inventory management platform to help grocers and retailers reduce food waste.

AI, ML and Automation

• Priomio.io offers solutions to reduce the amount of time spent on administrative tasks, increasing the productivity of sales and marketing teams. 
• SalesBeat uses external data such as demographics, seasonality, economic data, weather and point of sale data to create highly accurate demand forecasts. 
• Vici Robotics uses robots to scan products and barcodes on store shelves, increasing retailers’ productivity via inventory automation. 

Read more from the “Shark Reef” startup pitch competition, including our recap report and profiles of each participating company.

5.  Technology Is Accelerating the Rate of Grocery Retail Change

Technology was a major theme at Groceryshop 2022. Retail innovations quickly become best practices and, soon after, table stakes—the rapid evolution of retail demands an agile and flexible business model so organizations can quickly respond with innovative new products and services to meet their shoppers’ needs. 

Omnichannel is now essential. Shoppers want retailers to save products in carts across their shopping journey and recommend relevant products—such as birthday candles when a cake is added to the shopping cart—as well as the ability to geolocate products. Data facilitates personalization, speed and accuracy and, when combined with machine learning and AI, can move a retailer from a reactive to a predictive model and, ultimately, a prescriptive model. 

 

6.  Consumer Centricity Is the Beginning, Middle and End for Grocers

Currently, grocers are dealing with consumers’ demands similar to those seen five to eight years ago in apparel: shoppers want what they want, when and where they want it. They want personalized offerings that are relevant to them, as well as all available delivery and pickup options. Otherwise, consumers often view digital communication as nothing more than spam. Personalization strategies that adapt to consumer-specific contexts will drive engagement, loyalty and customer lifetime value.

7.  To Meet Consumer Expectations, Grocery Retail Requires Collaboration  

To rapidly respond to consumers’ expectations, grocers need to remove internal silos and collaborate internally. Marketing and loyalty programs need to collaborate with merchants to assure online and offline alignment.

Additionally, retailers should set up strategic external partnerships that deliver what consumers want, when and where they want it. Leveraging last-mile delivery services can provide an asset-light approach to getting products into the hands of consumers. 

8.  Personalization Can Help Consumers Find Health and Wellness Products and Programs

Customers are now searching for healthy and clean alternatives outside of food, expanding into categories such as beauty and personal care. At Groceryshop 2022, retailers discussed how they can serve health-conscious consumers by remaining transparent, simplifying the shopping experience and serving as trusted experts and advisors to consumers.

Ben McKean, Founder and CEO of Hungryroot, an online personal grocer platform with delivery and recipe features, discussed how personalization can simplify a consumer’s search for healthier food products, while also decreasing shopping time. Hungryroot provides a simple survey, allowing it to understand the customer’s health objectives, dietary restrictions and preferences, after which it automatically fills the consumer’s cart with healthy foods. The process cuts down consumers’ shopping times, as well as food waste overall, as it provides customers with exactly what they need. 

Amid a strained US healthcare system, health and wellness programs can provide a strategic path for grocers to connect with shoppers, surface white spaces for differentiated private-label opportunities and enhance shopper loyalty. Heinen’s Grocery Store, a family-owned grocery chain in Ohio and Illinois, differentiates itself by building on the concept of “food as medicine,” offering a wellness program backed by a staff of health coaches. Chris Foltz, Chief Innovation Officer at Heinen’s Grocery Store, said that 40% of the company’s customers participate in its wellness program, which includes curated products, supplements, meal solutions and recipes.

9.  The Metaverse Is Here

AJ Dalal, GVP of Data Strategy & Consulting at Publicis Sapient, discussed how retailers should think about the metaverse and become involved in it. As the metaverse is still in its early stages and so familiarity is low, Dalal stated that current players are considered early adopters. To demystify the metaverse to those still unsure, he explained that it is “the next iteration of the Internet… It is your website, an extension of your brand.”

Dalal also suggested that the current popular uses of non-fungible tokens (NFTs)—monetary exchanges and social media bragging rights—are largely “a mistake.” He argued that NFTs’ other utilities, such as tokenizing products, tracking the ethical sourcing of ingredients and creating smart contracts, which can eliminate the need for a lawyer in some cases, will be crucial to driving adoption in the coming years. 

• Read more Coresight Research coverage of the retail metaverse.

10.   Data Sharing Benefits Both Retailers and Brands, Yet Mistrust Remains

Many speakers at the event discussed collaboration and its benefits. As Ahold Delhaize’s CFO, Natalie Knight, explained, “collaboration is the wave of the future.” She also stated that, as omnichannel customers purchase two to three times more often than offline customers, the opportunity for online collaboration is particularly large. Retailers and brands working together and sharing data could help solve the issue of the lower profitability of e-commerce. Another benefit of data sharing is the optimization of advertising spending. For example, a brand can modulate its advertising spend based on inventory data from retailers.

However, retailers and brands are also “frenemies.” If brands share data with retailers, the retailers could use this data to promote their own private-label brands, and vice versa, which could ultimately create a climate of mistrust. Still, many at Groceryshop remained optimistic. As Are Traasdahl, Founder and CEO of Crisp, explained, “Data collaboration is not a zero-sum game. Everyone wins. [There are] higher revenues, less waste and better forecasting accuracy when data is shared.”