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Technology Meets Grocery: How Grocers Adapt to Changing Consumer Preferences
Shopping for groceries tends to be an on-site experience, where consumers can squeeze melons, decide between different soup brands, and determine the freshness of meats. Just because people prefer to shop for groceries in person doesn’t mean they don’t turn to technology for help.
CBRE’s recent report, “Increased Sales Through Technology Helps Boost Grocery Store Openings,” indicated that grocers’ in-store technology investments “helped boost overall sales by 5.3% year-over-year in 2023.” This has meant more retail space demand.
The report also explained that the 30 largest grocery chains in the United States opened more than 500 stores since 2020, with at least 80 new store openings on tap for 2024. “The growth in store footprints is occurring at a time of markedly increased funding for grocery-focused tech companies, relative to pre-pandemic levels,” the CBRE analysts noted.
The Data Speaks
The CBRE report examined a consumer survey by researcher Forrester, learning that many shoppers are already familiar with or would like to know more about in-store technology. Additionally, over 100 grocery operators surveyed by Supermarket News and Mercatus indicated that technology is integral to business strategy. The challenge, however, is cost. “Over 60% of them cited cost as the primary obstacle to adding tech solutions,” CBRE analysts pointed out.
Additional Challenges
The report also explained that in-store technology implementation has sometimes led to unintended consequences. There is a link between self-checkout stations and retail theft. LendingTree reported that 15% of self-checkout users acknowledged stealing, while 21% said they accidentally took items. Perhaps more alarming is that 44% said they’d steal again.
Because of this (and other issues), some grocers are restricting or eliminating the use of these stations.
Moving Forward
The report concluded by saying there is an increased interest among tech investors in the grocery store sector, especially as “operators make technological enhancements to help boost sales and improve customer service.” As a result, the report indicated that grocers who rely on technology above and beyond e-commerce would likely be in a favorable position for growth.
- ◦Lease
- ◦People
