Click-and-collect emerges as high-growth op for non-food, GMDC says
COLORADO SPRINGS, Colo. — Click-and-collect is emerging as a high-growth channel opportuntiy for non-food manufacturers, Global Market Development Center noted in its latest next practice report "Connecting with Click-and-Collect: Strategic Upside for Non-Categories."
“As retailers move swiftly into the uncharted territory of click-and-collect, one thing is certain: supplier partnerships must be deepened to successfully navigate digital transformation, manage shopper expectations and effectively create a positive outcome for all trading partners,” stated Patrick Spear, GMDC president and CEO.
The grocery industry is increasingly pushing online and some of the biggest retailers are ramping up click-and-collect models. That future is making many a bit jittery, especially for non-food, center-store categories. And while online grocery sales could exceed $100 billion by 2025, click-and-collect is emerging as a high-growth channel opportunity with a projected $6.6 billion of CPG sales per year by 2020 according to an IRI study.
“Non-food categories have long been recognized as basket-building categories for the retail grocery industry," stated Mark Mechelse, director research, industry insights and communications, GMDC. "In other words, they help drive in-store transaction size and build margin. No one – manufacturer or retailer – wants to lose these benefits as a result of the click-and-collect movement.”
In contrast to fresh and frozen foods, where brick-and-mortar stores are the preferred shopping destination, non-foods and HBC are seeing double-digit sales growth online, up 19.4% and 17.9% respectively from 2015 to 2016 according to Nielsen Homescan data cited by Acosta in its report "Bricks & Clicks – Understanding the Omni Channel Landscape." General merchandise isn’t far behind, registering 8.7% year-over-year growth online during the same time period.
To succeed and embrace this digital movement, nonfoods retailers and manufacturers must rewire their go-to-market strategies by working together to develop seamless, integrated strategies and plans that breed profitability, growth and success for all involved parties, GMDC suggested.
“Manufacturers should work with retail customers to make it easy to find products on the site by monitoring keyword search and optimize product descriptions and detail pages so items are easy to find," suggested Keith Anderson, VP retail insights at Profitero, and lead author of the whitepaper for GMDC. "Menu placement and ease of navigation is important for full-basket retailers that tend to mimic supermarket aisles.”
Profitero also suggests that creating in-cart suggestions similar to strategic cross-merchandising display execution inside brick-and-mortar stores, manufacturers should work with retailers to create cross-display opportunities online. Virtual bundling and cross-merchandising is another effective tactic. Unlike in a physical store, merchandise bundles needn’t be physically co-packed.
The collection point itself represents another prime opportunity to make the non-foods sale. Innovative approaches and out-of-the-box thinking will be required to add product displays, deploy digital advertising/promotions or other new technologies to capture shopper attention for non-foods goods.
“The good news is that we only have a small handful of large vendors today that do one-third of our business,” said Spencer Baird ,SVP merchandising, B2B and pick-up at PeaPod. “This means we can get to a lot more depth in our planning with them and find ways to create mutual value for our customer and the vendor. We will also partner closely with a group of smaller vendors," he said. "We’re not wed to the old ‘scale trumps all’ mentality because if you look at where our business over-indexes, in many cases it is on smaller, more progressive areas in nutrition or health sometimes, progressive is in the bag of smaller manufacturers.”
To meet the challenges and opportunities head on to enable a positive outcome through click-and-collect, GMDC offered these next practices:
- Since 69% of shoppers who use click-and-collect buy additional GM/HBW items, extend the technology platform to begin suggesting meal items and additional food-item purchasing with complementary non-foods;
- Create impulse displays or other POP materials near the point of pickup to increase sales;
- Place more non-food items on the first page of the click-and-collect site. When searching for items online, consumers have a propensity to not click through to the second and third pages; and
- Leverage geo-fencing technology to know when the consumer is near the store or ready to pickup their order.
Partners and supporters whose contributions have made the report possible are Newell Brands, Big Time Products, Melita and RugDoctor. Insight providers include Profitero, IRi , Acosta and Nielsen.
Amazon reduces delivery to two minutes through Instant Pickup
SEATTLE — Amazon has finally reduced the last mile equation to a matter of minutes with its Instant Pickup, a free service offering Prime and Prime Student members a curated selection of daily essentials available for pickup in two minutes or less at five of Amazon’s fully staffed pickup locations in Los Angeles, Atlanta, Berkeley, Calif., Columbus, Ohio and College Park, Md.
“Instant Pickup is another way Amazon is making life more convenient for Prime members,” stated Ripley MacDonald, director, student programs, Amazon. “As shopping behaviors continue to evolve, customers consistently tell us that they want items even faster. Whether it’s a snack on-the-go, replacing a lost phone charger in the middle of a hectic day or adding Alexa to your life with an Echo, Instant Pickup saves Prime members time," he said. "While Instant Pickup is available at select pickup locations today, we’re excited about bringing this experience to more customers soon.”
With Instant Pickup, Prime and Prime Student members can use the Amazon App to shop hundreds of need-it-now items like food, cold drinks, personal care items, technology essentials and Amazon devices like the Echo, Echo Dot, Fire TV and a selection of Fire tablets and Kindle e-readers. Prime members can browse the selection, place an order, even add last-minute items to an online order and pick it up from a self-service locker – all within two minutes or less.
Instant Pickup is available at five select pickup locations and will be available at more locations in the coming months. Amazon operates a total of 22 staffed pickup locations on or near college campuses across the country.
ModiFace launches virtual skin assessment platform
TORONTO — Augmented reality technology provider ModiFace has unveiled its latest effort — a web-based skin assessment platform for skin care brands. The patented technology allows users to upload a photo that it then analyzes for a virtual skin consultation, after which it suggests appropriate products for identified needs.
"We realized that instead of scoring the user's skin based on different dimensions, it would be far more useful to provide specific personalized advice that is both motivational and instructional,” ModiFace founder and CEO Parham Aarabi said. “In other words, instead of criticizing the user's skin or measuring their 'skin age', we tell users what is great about their current skin and how to maintain and enhance their skin health.”
The new platform was built in HTML and is compatible with all operating systems on mobile, tablet and desktop devices. The company said that it has been jointly testing the technology with L’Oréal’s Vichy skin care brand and was widely deployed on Vichy’s web and mobile sites.
ModiFace said the technology is immediately available for integration by skin care brands, noting that the integration consists of a single line of code that can be integrated within brand websites.