Grocery E-Commerce Catapults to a Strategic Priority

25th October 2017
From Kelly Thompson

Grocery E-Commerce Catapults to a Strategic Priority

Amazon’s acquisition of Whole Foods sent a new shockwave through the U.S. (and global) retail market. The sector had already faced unprecedented disruption from digital transformation, assertive consumers, and compliance constraints.

If grocery companies were scrambling before to reinvent their business strategy, Amazon’s announcement further accelerated the urgency for retailers to add robust e-commerce offerings. Now companies are playing catch-up because a presumed medium-term initiative catapulted into a short-term imperative.

Fortunately, most major grocery retailers have some e-commerce presence, even if it’s in a pilot stage, and nearly all of them offer home deliveries with companies like Uber, Lyft and Instacart. However, now retailers must commit to working closely with their supply chain partners for e-grocery success.

How data boosts e-grocery sales
Faster e-grocery adoption means shoppers will soon expect far more detailed product data to convince them to buy food online, including private label products. For successful grocery e-commerce, retail companies must provide more descriptive product data because that’s what today’s online shoppers expect.

Within the next year, grocery retailers and suppliers will race to clean up their private label product data. Retail companies need detailed private label product data immediately to share on their websites so consumers trust and buy their products.

Clean grocery data is a supply chain issue
Maintaining and sharing accurate, consistent product data is increasingly important for both private label and national brand. National brand suppliers currently submit the product data through an online system to post on retail websites; however, the current infrastructure is less established for private label data sharing.

Product lifecycle management (PLM) systems help retail companies populate the product data that suppliers and retailers put on their websites to share with consumers and build trust. In the past, suppliers entered product data into a PLM system although the data was not clean or polished enough to share with consumers; it was merely enough data to comply with legislated minimum data requirements, such as the ingredients in the final product.

Now that e-commerce is a strategic priority, it’s more important than ever for retailers and suppliers to collaborate and enter accurate, up-to-date data in PLM systems and websites to share with consumers. This means retailers must reinvent their internal and supply chain processes to speed up how they enter product data to make it thorough and ‘consumer-ready.’

Collaborating for e-grocery success
Legally speaking, any product information that goes on a retail website – such as industry certification – receives the same level of scrutiny as product labels, which the U.S. Food and Drug Administration (FDA) and U.S. Department of Agriculture (USDA) monitor.

As e-commerce grows and stores offer buy online, pick-up in-store services, new product data will be required across the supply chain. For example, suppliers already share handling conditions, such as whether a private label item needs to be refrigerated, to assist store merchandisers. Now suppliers will need to share this data with retail professionals who work in the staging area, as well as delivery workers and consumers, too.

Retailers’ risks also increase as supply chain complexity increases. Contrast the low risk of selling in physical stores only and the comparatively high risk of communicating product data across the supply chain, including food handling, storage locations and delivery partners. Longer supply chains mean retailers must mitigate risk by capturing and sharing the right product data as efficiently as possible.

Data drives sales
Suppliers and retailers are seeing the value of collaboration because it can help them stand out and sell more, especially since online grocery is poised for dramatic growth. As a result, retail companies are more motivated to do data-sharing right and take it seriously as e-grocery evolves.

To help retailers and suppliers collaborate and compete better, Trace One helps companies adapt to emerging trends, including online grocery. Retail companies around the world use our PLM solutions to share private label product information to boost efficiency, consumer confidence and sales.

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