Kroger ratifies labor agreement for some Ohio workers
Cincinnati – The Kroger Co. Cincinnati/Dayton Division associates working at Kroger stores in metro and surrounding areas have ratified a new labor agreement with UFCW Local 75. It merges the formerly separate Cincinnati and Dayton contracts.
The contract covers 12,766 associates working in 76 stores in Cincinnati, and 4,945 associates working in 32 stores in Dayton.
"We are pleased to reach an agreement that is good for our associates,” said Sukanya Madlinger, president of Kroger’s Cincinnati/Dayton Division. “This agreement provides wage increases, affordable health care and investment in our associates’ pension fund to support their retirement. It comes after thoughtful and productive work by both the company and union bargaining committees. I want to thank our associates for supporting this agreement and for the excellent service they provide to our customers every day."
Leveraging In-Store Location-Based Services and Customer Engagement
By Bill Davis, Director, MB&G Consulting
For much of the last year, traditional brick-and-mortar retailers have been mired in a slump. Not only was last holiday season the toughest in several years, the consumer discretionary sector, which includes retail, was the only one of the 10 macro S&P sectors to be in the red for the first half of 2014. As a result, retail is widely perceived to be in a funk.
And to change their fortunes, retailers are being encouraged to embrace omnichannel retailing, which can be summed up as an integrated and seamless customer experience across the retailer’s various sales channels. I believe the primary reason why retailers are being encouraged to look at omnichannel retailing is that the majority aren’t viewed as being able to compete against the pure play e-tailers because:
1. E-commerce is not in their DNA like it is for Amazon, eBay and others;
2. The technical skill sets required to excel in e-commerce are not readily available and there already is fierce competition for those resources amongst the digital leaders; and
3. With $260 billion-plus in online sales in the U.S. alone in 2013, it’s too late to put the lid back on Pandora’s Box.
As such, retailers need to find ways to leverage their historical strength, the store, which is currently viewed as a more of an anchor than an advantage. However, with 90% or more of retail sales still occurring in-store, retailers need to push back against the e-commerce competition to help stop the bleeding. And leveraging an emerging channel like mobile helps, as the ability to identify that a loyalty or regular customer has entered the store and to message/engage them via their smartphone assists retailers with an omnichannel initiative whose focus is to enrich and improve store performance.
The challenge most retailers face is determining which in store location technology to use as there are several emerging and each has its pros/cons. Below is an incomplete list:
• Bluetooth Low Energy (BLE) Beacons (aka Bluetooth Smart): a wireless, personal area network (PAN) technology using low power, low cost transmitters supported by the latest versions of the major mobile operating systems (e.g. iOS, Android, Windows, etc.) to enable proximity sensing of the device using the same 2.4 GHz radio frequency as classic Bluetooth.
• Wireless Fidelity (WiFi): a wireless, local area network (LAN) technology based on the Institute of Electrical and Electronics Engineers (IEEE) 802.11 standards that enables an electronic device such as a smartphone, tablet, etc. to connect and exchange data with the Internet.
• Global Positioning System (GPS): a space based satellite navigation system that provides location and time information to GPS enabled devices such as smartphones, tablets/laptops, etc. in all weather conditions anywhere on earth where there is an unobstructed line of sight to 4 or more of the GPS satellites.
• Indoor Mapping: usually based on planograms, which are the output of a retail space planning software application that defines where and in what quantity products are placed on shelving units inside a retail store.
• Mobile Wallets: applications on smartphones to store payment, loyalty and gift cards which because of their ubiquity on Android (Google Wallet), iOS (Passbook) and Windows (Wallet) devices can be leveraged to identify the person carrying the device as well as their location.
• Radio Frequency Identification (RFID)/Near Field Communication (NFC): is the wireless non-contact use of radio-frequency electromagnetic fields to transfer data for the purposes of automatically identifying and tracking objects; NFC is based on existing RFID standards.
• Magnetic Field Variations: many animals utilize local variations in the Earth’s magnetic field to find their way; these same magnetic variations commonly exist inside buildings and smartphones can sense and record these variations to map indoor locations.
• Visible Light Communication (VLC): is a data communications medium using light-emitting diodes (LEDs) and can be used for ubiquitous computing because light-producing devices are everywhere.
Given the variety of technologies mentioned, it would seem there won’t be a single solution that dominates, although BLE Beacons are off to the early lead. That being said, I would suspect that in a few years there will be a shake-out, no doubt influenced by retail technology solution providers like Apple, Google, IBM, Oracle, etc. Personally, I think there’s an opportunity for third party(ies) to become the “trusted advisor(s)” testing out these technologies so that retailers don’t have to learn by trial and error which location based technologies work best in their physical environment.
The ability to engage consumers in store via smartphones so that they are no longer invisible, with their permission, of course, has tremendous upside for their business. And for customers to participate there has to be something in it for them. Similar to the Internet, retailers have to give something to get something. But knowing a loyalty customer has crossed the threshold without having to wait for them to walk up to the register to buy something seems like a great place to start, especially if they leave the store without purchasing, but eventually expanding this to make suggestions to consumers based on their location and past purchase history, as well as incentivize them seems like the logical evolution.
Brick-and-mortar retail needs to reinvent itself to compete with the e-commerce threat and while price matching and consistent prices across sales channels efforts are being implemented, it’s not enough. Traditional retailers need to go on the offensive where they have the advantage, and that means their stores. Without this, it’s my opinion brick-and-mortar retailers are going to continue to cede market share and the retail landscape will continue to be reshaped by the e-commerce tsunami.
How a Smart Digital Strategy Can Make the Physical Retail Store a Prime Asset
By Dave Richards, Accenture
In the early days of e-commerce, internet shopping was supposed to spell the demise of the physical store. Pure play online retailers would sweep all before them, rendering the retail store a historical curiosity. In fact, it hasn’t quite worked out like that. Recent Accenture research confirms that more shoppers are planning to increase their purchases from physical stores this year than last. However, the positive news for brick–and-mortar needs to be tempered with the realization that what shoppers want from the in-store experience is changing fast, shaped by their digital experiences. Retailers who fail to understand those new needs and adapt accordingly will struggle.
Two worlds collide
Rather than thinking about the store and online as discrete entities, retailers need to bring the two worlds much closer together. Consumers are looking for experiences that bring the best from digital and physical. For example, more consumers today are ‘webrooming’ (browsing online before making an in-store purchase) than ‘showrooming’ (going to a store to make their selection and then searching online for the best price) across a variety of retail categories. They also increasingly expect their purchases to be delivered for free, with more than half (57%) saying that waiting for free delivery was the most important option. In addition, a higher proportion of shoppers year on year are using click and collect services, whereby they purchase an item online and then pick it up from the store.
The findings of Accenture’s survey point to a new stage in the development of the interplay between the online and physical retail worlds. What consumers increasingly expect is a seamless experience across all channels. That means, for example, consistent product ranges across all channels, with the same promotions and prices available regardless of how a consumer chooses to shop.
The struggle for seamlessness
In terms of delivering a seamless experience, most retailers are still finding it hard to forge deep connections between virtual and physical. Less than one-third of consumers surveyed said that their accounts were connected across in-store and online channels. Yet moving closer to a singular experience, regardless of which channel the consumer uses, will pay clear dividends. For example, simply being able to find out in real time about product availability would persuade the majority of customers (89%) to make a purchase.
Of course, bringing the two worlds together is a challenge. But it’s also a huge opportunity. Harnessing detailed customer information across all – digital and physical – channels and touchpoints, and by deploying analytics, can create the basis for new models of customer engagement and personalized service.
Reinventing the store
So what does that mean for the future of the store itself? One thing’s for sure; more of the same is not an option. As retailers rethink their physical space they need to understand it alongside their virtual presence to create a new and differentiated customer journey. In this new world, not all physical locations need to be destination stores. But those that do need to offer something exceptional in order to stand out from the both the online and the physical crowd.
One key element will be retail staff that have deep product knowledge and can offer customers advice and support unavailable elsewhere. As consumers now routinely do their own product research online, staff who are one step ahead of them can really help differentiate the in-store experience and help close a sale. Achieving that level of service will require retailers to invest in and commit to in-depth training.
Of course, some stores will need to be primarily about convenience. Understanding different customer needs and behaviour through analytics will help to determine the best use of physical locations.
Too much choice?
But it’s not simply the in-store environment that retailers need to consider. Product assortments also need careful consideration. While choice is a consistently important factor in making a retailer attractive, the question of just how much choice must be offered requires close attention. Simply having an extensive assortment is often seen as a positive end in itself. But closer analysis questions the profitability of pursuing a policy of ‘assortment for assortment’s sake’. Instead, successful retailing comes from acting as a curator and editing the choices available in order to provide customers with an evolving assortment, both online and in-store, that reflects their preferences and ‘derisks’ the choices they make. The aim is to meet a wide variety of needs but without the requirement to continuously extend the number of items offered.
Bringing it all together
Bringing together deep insights into changing customer needs and behaviour alongside understanding how they will impact the development of online and physical retail channels will become increasingly critical for success. As Accenture’s research shows, today’s shopper does not favour one channel over another. Rather they’re seeking the optimal combination that will offer the right experience at the right time. Winning retailers will respond by delivering the best of both worlds, seamlessly.