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Integrating New Channels In Food And Grocery – Pandemic Lessons

3 Mins read

The COVID 19 pandemic was one of the most disruptive global phenomena of the modern age. Even 2 years after the initial breakout was reported, the world is still fighting the battle against COVID through vaccinations, social distancing norms, restricted gatherings, wearing of masks, and other policies.

For the business world, the pandemic brought about radical changes in the way consumers purchase goods and avail services from them. Today widely acknowledged as the new normal, a massive digital takeover has taken root in several sectors like retail, healthcare, finance, entertainment, and education.

Among the sub-sectors within retail that had to adapt to disruptions of the highest scale were grocery and food businesses. Businesses selling these daily essentials suddenly witnessed a dramatic change in the way consumers purchased from them. Along with the change, there was no shortage of business opportunities and for most businesses, demand is now picking up as well. The disruption came from the choices consumers made in how they chose to engage. Customers moved in numbers to online delivery apps and eCommerce websites. Another big change the industry had to contend with was how the supply chain behind the effective movement of grocery and food items became severely impacted due to travel restrictions and health scares.

The pandemic saw an influx of technology-driven businesses sweeping in and grabbing the market share that was traditionally dominated by physical stores of all sizes.

Let us examine the top 5 new channels that came into prominence during the pandemic season:

eCommerce

Consumers wanted to avail themselves of groceries, food, and similar daily essentials from the comfort and safety of their homes. A channel opened up for them to do so via eCommerce websites. The task for these retailers turned eCommerce players was a big one. Beyond just providing basic access to essentials, they had to up their digital game to match customer expectations. Customers demanded experiences similar to what leaders like Amazon offered. If anything, the bar for online food and grocery retail was set even higher. Customers wanted things to be as simple as placing an order for any food or grocery item on an app in their smartphone and then having it delivered immediately unlike the timelines experienced in eCommerce shipping.

Delivery Aggregators

From Amazon to Uber Eats, Instacart, Doordash, etc. the list just goes on for the number of online services engaged in sales or delivery of groceries and food to consumers. These service providers weren’t necessarily food or grocery sellers themselves. They created sophisticated platforms that brought together multiple retailers into one ecosystem from where millions of customers could access their services. Consumers could purchase their required items from any local store or restaurant they wanted. These aggregators did all the heavy lifting in terms of creating the online infrastructure and providing the offline last-mile delivery. In return, they sought a substantial fee from the participating retailer.  

Social Commerce

As the pandemic prolonged, consumers demanded even more convenience from their online ordering options. This led to the evolution of social ordering wherein all that was needed for placing an order was a message on any of the popular instant messaging applications like WhatsApp or Facebook Messenger. A restaurant or store would have an official account on these social media and orders would be taken via IM and delivered to consumers at their homes. This means really comes into its own when exploited in hyperlocal mode, where the familiarity of the retail brand and the ease of local delivery come together to create a powerful and near-instantaneous experience.

Self-Service Kiosks

For those consumers who did eventually venture out to nearby stores and restaurants, the prospect of having to physically interact with store staff was not a pleasant one. This led to the rapid rise of self-service kiosks at stores which would dispense products automatically after a customer pays via their card or smartphone app when near the kiosk.

Buy Online & Pickup in Store

Consumers also opted for options where they could pre-order their desired grocery or food items via an eCommerce website or app and then pick it up on their own from the store. They wouldn’t have to queue up as they would be notified of the exact time, they need to be available at the store to pick up their order.

The pandemic made grocery and food businesses think about 3 fundamental questions to sustain their business.

· Manage the influx of orders across diverse old and new channels

· Ensure a consistent and high-quality customer experience in the new omnichannel business model

· Enable seamless logistical coordination to meet dynamic market needs

With a considerable share of their business now being addressed through the new channels mentioned above, it’s apparent that food and grocery businesses need sophisticated and scalable order management and fulfillment strategies to ensure disruption-free customer service. This will be ultimately realized through implementing a flexible and scalable technology architecture. This technology infrastructure will have to factor in order and delivery implications from these multiple channels, decentralized inventory management, and omnichannel interactions. From pricing structures to supply chain coordination, the underlying technology framework for such businesses will need to evolve and support the rising demand for superior experiences from consumers.

Get in touch with us to explore how your business can benefit from our solutions and advisory that is presently helping some of the world’s best grocery retailers and food businesses navigate the new normal without risks.

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About author
Prasad Malluvalasa is a Principal of SAP Groupsoft. He works with client teams to arrive at enterprise solutions that are scalable, adaptable, and in synchronization with ever-changing business needs. With his SAP solution expertise, he helps enterprises effectively integrate SAP technology into the client’s business environment to achieve the expected business results.
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