How Google is preparing grocers, retailers to win in the e-commerce game

“Google has all these amazing capabilities, and one of the opportunities that exists is to provide those core capabilities to retailers around the world. ... You don't have to be huge and have an enormous budget to be able to plug into some of the most foundational things. Personally, it's an opportunity to have some of the regional grocers be able to effectively compete in their market providing great service to their customers great experiences to their customers, efficiency in their operations.”                                                                                                                      

Building the tech foundation to win in omnichannel

As grocers and retailers navigate changing consumer behaviors ─ whether it’s trading down to private label or a return to more in-store shopping ─c onsumers rely on digital shopping tools more than ever before, Tepfenhart noted

“Pre-COVID, folks were running 2% or 3% of their business through digital. And in a post COVID world, we're talking 10% to 15% depending on other retailers—some of them higher than that. So, digital is here to stay,” Tepfenhart said. “I don't think it's an, ‘Oh return to bricks-and-mortar,” I think it's [a] return with your smartphone. And so, you've come back to bricks-and-mortar, but you're expecting the digital tools to do what you're doing, to save you time, to get better deals, [and] to be more efficient.”

When it comes to creating the store of the future and robust omnichannel experiences for customers, Tepfenhart explained that Google is focusing on four key areas: enabling retailers to be more data-centric, helping them create their digital and omnichannel experiences, modernizing the store experience, and providing ways for them to be more efficient and sustainable in their store operations.  

Creating one-to-one personalization, leveraging AI to make it happen

When it comes to the specific technologies that is enabling retailers to provide a robust customer experience, AI technology has quickly become an important tool, which shows potential to deliver “the holy grail” of digital shopping experiences, Tepfenhart said.

“Once upon a time ... we called it segmentation, and we take a group of people in that segment, and we kind of model their behavior and their preferences and then we'd market to that segment. I think the holy grail really is being able to one-to-one personalize because each of us are unique.”

But before retailers and grocers can fully utilize AI to personalize, they need to “connects the dots” with their consumer data ─ which can include promotion engagement data to call-center interactions ─ and implement a data platform, Tepfenhart said. With this in place, AI technology will have the data to deliver on one-to-one personalization at scale, he added.

And when it comes to the personalized shopping experience itself, AI can learn from a consumer’s overall taste preferences, health concerns, and the items purchased over time to recommend products that the consumer might like and facilitate digital brand discovery, Tepfenhart said. Additionally, AI can reduce mundane tasks of shopping online and can proactively build carts, based on consumers preferences, he added.

“It's taking out the mundane because 80% of what we buy is the same stuff. And so why do I gotta go through a build a cart and do all that? Why doesn't my AI come in and go ‘you know you've got a pretty good order pattern we suggest you're going to need these things,’ and [you can] just delete whatever you don't need,’” Tepfenhart said. “I think AI properly done, and digital properly done, enhances baskets, enhances the customer's experience to be an explorer.”

How to get started: Start small

While big retailers might have the capacity to make large e-commerce changes and leverage the full extent of digital capabilities, smaller and more regional grocers can work to provide enhanced digital shopping experience by focusing on one or two area or work to get themselves on a customer data platform if they aren't on one already, Tepfenhart said. 

“Google leads with how to be responsible in AI and Google's, the foundational company for most of the AI concepts you're hearing about today,” Tepfenhart said. “Google is a real enterprise partner for retail, and we've proven it over and over again, and the capabilities that we're bringing broadly. And the idea is how do you democratize data and AI for retailers to be able to compete, not just the few retailers, but everybody. We want a world with a corner grocery store.”