As shoppers increasingly split their grocery spending across channels and retailers, brands and grocers must work harder to win repeat trips in an attention-fragmented, omnichannel marketplace, according to a recent Spins webinar Winning Outcomes: Category Collaboration Roundtable.
Omnichannel is table stakes for retailers in an attention economy – and while myriad options and channels lets consumers pick where and how they buy their groceries, it creates fragmented loyalty for retailers and brands.
This behavior sharply contrasts with how consumers once shopped – relying on a single large grocery trip at their preferred retailer and engaging through loyalty programs and promotions.
Brands and retailers without a data-backed stocking strategy are at risk of losing share because when a product goes out of stock in one place, consumers simply find it somewhere else, explained Angela Bozo, director of member programs for Independent Natural Food Retailers Association.
“There are more convenience trips, more price comparisons across retailers and an expectation that items are available immediately,” added Kasey Jorenby, category manager for Minneapolis-based retailer Lunds & Byerlys.
This “anytime, anywhere, anyhow” mentality gives consumers the advantage, allowing them to find the best deals, said Ryan Cunha, director of category management for Frontier Co-op.
Yet retailers risk crossing a line between personalized promos and surveillance, which Bozo says could “seriously alienate a shopper.” This delicate balance reflects a broader trend in personalized grocery pricing, with some states pursuing legislative action against the practice of retailers using data to set prices based on consumers’ shopping habits.
Winning repeat trips in an attention economy
So, how can retailers increase those coveted return trips and build loyalty for themselves and the brands they stock?
Retailers and brands must understand who their shopper is to curate targeted messages, said Cunha, stressing the importance of implementing “the right mix of tactics through shoppers at each stage of the purchase funnel, from awareness to purchase, as well as after purchase.”
These tactics include loyalty programs, where members typically generate larger basket sizes, according to Jorenby.
Retailers and brands also can implement discounts, targeted promotions and digital coupon programs, she added.
For brands that deliver on perceived value propositions like taste, sustainability or health, promotional offerings can strengthen loyalty beyond the initial purchase, per Cunha.
Brands and retailers also can implement beta testing that delivers different messages to different groups on a small scale to identify what resonates and then scale those efforts, Cunha explained.
Where is omnichannel headed? And how can brands and retailers stay ahead?
Consumers now treat digital and physical shelves as equally important, which means retailers must maintain consistency across these channels to create repeat customers, according to Jorenby.
“Consistent messaging across the app, website, third parties and in-store shelves is critical to capturing the customer regardless of how they shop,” she said.
Online performance now plays just as important a role in a business’ strategy as velocity or incrementality, said David Parham, senior account manager for Impossible Foods.
The shift in performance metrics shows retailers now rely on online pickup and delivery as essential parts of their sales mix – and brands must demonstrate how their products align with these strategies to stay top of mind.
AI and fulfillment reshape the next phase of grocery
AI also continues shaping how brands create a more seamless experience for consumers.
“Brands will start not just winning through distribution … but how their data is structured in AI models,” Cunha said.
Retailers, like Walmart, also are turning their stores into “mini warehouses and fulfillment centers” to deliver products to shoppers faster and at lower cost, he explained.
“It’s going to level the playing field” where brands “won’t win strictly on price and speed” and instead “geographic proximity is going to be more order fulfillment,” Cunha added.
