The Modern Shopper brings together the best minds and insights of a diverse group of food retailers and other industry experts to discuss their strategic initiatives and their top of mind challenges. Our focus is around health and sustainability, e-commerce and retail innovation. This series aligns with Spoon Guru’s core mission to help retailers discover a seamless, personalized and accurate product discovery experience for shoppers based on their dietary and lifestyle needs and is hosted by Phil Lempert. In this season of Modern Shopper industry experts share their insights on the changing retail landscape.
Zeeshan Idrees is the CEO of digital innovation platform, IndustryGeniuses. He has 20 years experience in digital strategy, and is a consumer trends champion, tech investor, digital transformation leader, global go to market strategist, and editor in chief of B2B industry newsletters. In this great episode he spoke to Phil Lempert about reinventing grocery with emerging technology & nutrition science.
“I think one of the interesting stats is that on an average basis consumers interact with retailers across ten different price points – that makes things a lot more complicated. I think in the post-Covid era, there’s a kind of rising focus on health and wellness; consumers are now expecting the food shopping to be a lot more healthier in nature. I think this is bringing massive opportunity, you know, as well as a lot of disruption in food and grocery retail. And I feel that food retailers that no longer cater to the unique dietary needs of the individual shopper will really start to become irrelevant over the next five years.”
This interview runs for 16 minutes.
🖥 Watch the interview:
🎙 Listen to the interview:
Also on: Podbean
📄 Read the full transcript:
Phil Lempert: Today’s topic is ‘Reinventing Grocery with Emerging Technology & Nutrition Science’. The retail industry is experiencing a period of unprecedented change. New technologies, global economic shifts and changing consumer preferences are driving retailers to find new ways to reach their customers. Successful retailers will need to understand just how these forces are shaping the future of retail in order to succeed in today’s marketplace. In this season of Modern Shopper, industry experts will share their insights on the changing retail landscape. My guest is Zeeshan Idrees, a consumer trends champion, tech investor, digital transformation leader, global go to market strategist, editor in chief of B2B industry newsletters that cover retail, consumer packaged goods and health care in the U.S., in Europe and in emerging markets. Zeeshan, welcome to The Modern Shopper.
Zeeshan Idrees: I am thrilled to speak to you, Phil. Absolutely a pleasure.
Phil Lempert: We know the grocery is evolving. But, especially with the pandemic, is it not evolving fast enough? What will it take to improve the standard of personalization within grocery?
Zeeshan Idrees: Good question, Phil. I think, you know, let’s just step back and really try to understand food and grocery retailing. Food and grocery is a very large, complicated industry with global supply chains, local farmers, you know, large footprint of stores that are very regional in nature and also perishable nature of the food items. I think in the last five years, if you think about what has been the biggest change, is digitization, so why is it digitization and also the post-COVID era as well, which we are now actually witnessing. I think that has transformed how consumers shop for groceries. In the world of digitization, and I think one of the interesting stats is that on an average basis consumers interact with retailers across ten different price points, that makes things a lot more complicated. I think in the post COVID era, there’s a kind of rising focus on health and wellness, consumers are now expecting the food shopping to be a lot more healthier in nature. I think this is bringing massive opportunity, you know as well as a lot of disruption in food and grocery retail. And I feel that food retailers that no longer cater to the unique dietary needs of the individual shopper will really start to become irrelevant over the next five years.
Phil Lempert: So I’ve got to ask you, and I agree with everything that you’ve just said, but why are these retailers still behind on the key fundamentals? You know, an example where we’re coming up on the fall and I know when I go onto the US supermarket’s e-comm site, if I click on, you know, my attributes and I say that I’m a vegan, I’m still going to get an offer for turkey, you know, for Christmas and Thanksgiving. Why are they just not moving fast enough?
Zeeshan Idrees: Yeah, a good question, Phil. I think food retailers have been laggard in the adoption of technology. You know, the focus has always been, you know, buying food products and low pricing, and then you also get to consumers in the form of a myriad of promotions and discounts. And, you know, over the last ten years, the real innovators, disruptors arguably were Amazon and Alibaba. You know, for example, Amazon was the first one to launch checkout free technology, at least in the US. You look at Alibaba, they brought in robotics to improve the customer experience inside the store. They were the first ones to offer digital payments with facial recognition. So food retailers have been laggard in the adoption of technology. I think this is starting to change. So we are seeing more and more food retailers opening digital innovation labs. I feel that forward looking grocers are really tweaking and leveraging technology as a key value add, not necessarily a cost center, but really as a board level strategic priority. So I think I feel while they’ve been laggard over the last two to three years, this massive interest in actually developing a more personalized offer based on the problems that you’re describing. So I do see that we will see more and more change over the next 2 to 3 years in this regard.
Phil Lempert: Well, first of all, that’s great news. Tell me, how important is it for retailers in particular grocery retailers, but not limited to them, to have partnerships with technology companies?
Zeeshan Idrees: Yeah. Yeah, so I think, you know, as a retailer it is very easy to get lost by investing in the next shiny object that doesn’t translate into any real business value. And I think at the same time, if you’re being too conservative, you will miss out on the enormous potential of technology investments. So I think, you know, having the right technology partnerships is extremely important. Now we know that, you know, digital and technology is a board level agenda, you know, as a retailer, you really need to partner with the right companies and really start making use cases that create real business value. One of the tools I often recommend for food retailers really is, you know, deconstruct and construct. What that means is, you know, you actually have a mechanism in place to understand every business interaction, every business processes, you know, across marketing, sales, customer service operations and really try to understand the pain points, and then really leverage technology to solve those pain points. And I think that’s where the tech partnerships really come in. You know, having the right partners that align with your business processes, speak the language of your industry, and then make sure that they are kind of long term viable partners for you to make those things happen.
Phil Lempert: What are those secrets that you’ve got that you could share with retailers to make sure that they’ve got the best partnership possible with tech companies?
Zeeshan Idrees: Yeah, I think that, you know, in the excitement of launching new technologies, you know, you could probably get lost in rolling something out without really understanding what is the business impact of that. And I think that’s why the concept of POCs, which is proof of concept, minimum, viable product, you know, test something very quickly with your customers and then refine that based on the customer input. I think that absolutely is critical. And then your colleagues are your best brand ambassadors. You know, you encourage them. You reward them for adopting technology. I think that’s key. So, you know, launch early in the market, fail faster if you have to, refine and find your unique offer and then really learn from your customer input.
Phil Lempert: So now let me flip it the other way. What are those hints and secrets for the technology companies to support retailers in the most effective way
Zeeshan Idrees: Yeah so you know, Phil, 15 years ago let’s say, you know, ERP investments were huge. It was kind of a spring break type of mentality, right? It was a large scale, very functional driven investments that retailers and other brands were making. I think now technology has taken a central role in driving a strategic agenda. I believe we don’t really have 18 months, two years before you roll something out. I think because consumers are expecting a kind of, you know, real time experience, retailers really need to partner with technology providers that can really offer that sort of solution. So how do we, retailers or technology providers, partner with companies and really make sure their offer is aligned with what the market is saying? I would probably say it’s really twofold, you know, one is make sure that you kind of move away from functional practices into building more industry tailored propositions. So speak the language of the industry. You know, food retailers, as well as other brands of the industries are really asking for that. I think the second one is the pricing structure. You know, as a technology player, really those large scale investments are pretty much out the door, you know, with cloud computing, software as a service propositions. You know, retailers expect technology providers to get the skin in the game and really, you know, create more outcome driven pricing models where you are able to show, you know, return on investment very quickly and really, you know, roll out value driven POCs that offer an opportunity to retailers to find new solutions based on customer input.
Phil Lempert: So you mentioned the consumer. Probably that’s where everything needs to begin and end to make sure that as a retailer you understand your consumer. Help us understand what, what do you see in your crystal ball for consumer expectations? What’s going to be the next big disruptor for consumers that retailers should be aware of?
Zeeshan Idrees: And so that’s the billion dollar, maybe even a trillion dollar question is very difficult to predict. But I think if you look at, you know, what has happened over the last year or so, I feel like Metaverse, Web3 are really set to take technology to a whole new level and it’s really being driven by Gen Z. I think Gen Z are the new disruptors. They were kind of brought up with these 3D, you know, VR type of technology experiences. You know, JP Morgan is predicting that Metaverse will create over $1 trillion in economic opportunity over the coming years, right. So I think, you know, we don’t, we can’t really predict exactly that, how this will pan out. What we know for certain – there is enormous opportunity in this new kind of shiny object, you know. You know, you look at brands such as Carrefour or Wal-Mart, L’Oreal, Adidas. They’re all really investing in this new technology to really learn how they can leverage that to improve their business processes. You know, we’re seeing sort of, you know, rise of digital avatars, you know more VR powered stores, virtual fashion shows, even, you know, using Metaverse to really empower your colleagues. So I think we are really at the inception of what could become a really exciting opportunity for brands across every industry. But, you know, step back and really, you know, doing something for the sake of technology may not be the right strategy. I think the fundamental principle still remains the same. Think about your customer first. Understand your business priorities, and then make sure your technology agenda really fits and meets your business goals as well as corporate readiness.
Phil Lempert: So you mentioned the Metaverse. Is that going to be the future of e-commerce? And if it is, how do we make it better in the context of health and wellness?
Zeeshan Idrees: Yeah so, so I think, you know, we’re all speaking about food retail. So let’s look at the overall market size. I mean, globally, the grocery market is worth about $12 trillion. I think e-commerce is still very small, actually, and I think it’s going to grow. The growth is going to be huge over the next ten years. I think, you know, the research is saying that e-commerce would be worth $2 trillion by 2030 as per Grandview research. But I think, you know, if you look at the size of the pie, that is still kind of just over 15% of the total grocery market size. So what this means is that the bulk of the action will happen inside the store. And I think, you know, we need to focus more on omnichannel retail, smart stores, and more hyperlocal delivery options. They all become strategic priorities. And I think if you blend kind of, your question is on Metaverse, how do you blend metaverse into this exciting new experience? That would also be a huge opportunity as well. The second part of your question is health and wellness. I think, you know, you’ve got to do it maybe in a couple of ways. The first option really is make sure your data catalog is more health and wellness oriented for each and every part of, you know, what are the rich dietary attributes that are tied to that product. So you need to have a very rich data catalog.
The second part really is, you know, personalization of experience, right. So if you are, for example, a diabetic consumer or shopper, the business processes, for example, the marketing engine need to be aware of that, and really offer you promotions that fit your health and diet needs. So I think that’s going to be extremely important. And I think the third part obviously is really rewarding the consumers. I think, you know, how do you make sure that consumers are rewarded for shopping baskets that have a higher score on healthy products? And we know, you know, as per a recent survey by Ipsos in the UK, you know, over 3 in 5 consumers agreed that they would like to change their diet to make it healthier. I think that is a massive opportunity for grocers, to really deliver a health and wellness focused proposition. And we do know that, you know, Spoon Guru recently has partnered with Schnucks to really build this offer. Which would you feel that, you know, more and more technology players are partnering with food retailers to create a very super interesting proposition in the health and wellness space.
Phil Lempert: If I’m a retailer and I call you up on the phone or I’m on Zoom and I say, you know, I’m really looking for that one thing that I need to do this year, in 2022, that requires low effort so I can make sure it gets done and have a high impact. What would you tell me?
Zeeshan Idrees: I would just simply say take a three step approach. Because I think, you know, as technology is becoming a strategic priority, you need to really build the innovation ecosystem as an ongoing concern. This is something that you could not launch once and forget about, I think innovation really needs to become part of your DNA, whether you are a food retailer or any brand. So I think, step one, you create a digital innovation ecosystem with the right tech partners. You need to partner with companies who actually align with you, with your business priorities. The second is, you know, launch MVP, which is kind of Minimum Viable Product, right? Your use cases need to be very quick to market so you can really learn and find your unique offer based on your customer input. And I think thirdly, your colleagues are your best brand investors, you make sure you engage and reward your colleagues to adopt innovative solutions.
Phil Lempert: Great words of wisdom. Thank you for joining us today on The Modern Shopper. And we look forward to taking your words of wisdom and turning it into reality in every supermarket in the nation.
Zeeshan Idrees: It’s been a real pleasure Phil, real pleasure. Thank you so much for the opportunity.
