Investing in connectivity solutions can help grocers remain competitive in a digital world

Grocery store owners and operators undoubtedly understand the importance of e-commerce today. Still, the numbers can be staggering: revenue from US digital grocery sales will grow 20.5% this year, reaching $147.51 billion in 2022, and climbing to $245 billion in 2025. Between 2021 and 2025 the average annual spend per digital grocery buyer will increase from $856.47 to $1,524.84.

While digital shopper marketing (targeting consumers through digital and mobile experience based on past-purchase behaviors) has been a growth factor for grocery sales since the early 1990s, it was only fairly recently that it spurred an upward trend in omnichannel grocery sales. In the last ten years, there has been massive growth in the number of digital/mobile shoppers and revenue attributed to those channels.  

However, despite prior growth, pandemic-driven changes to consumer behavior caused a seismic shift in the way people think about buying groceries. And as restrictions and mask-requirements have become less strident, where e-commerce grocery purchases were once amplified by pandemic concerns, many consumer purchases are prompted by convenience now. In a recent poll, digital shopper marketing platform Chicory found that 46 percent of consumers responded that convenience was their main reason for e-commerce groceries purchases, while only 10 percent said their e-commerce choices were informed by health and safety concerns.

It’s becoming clear that while pandemic concerns initially forced grocers to quickly scale their e-commerce offerings, grocers must now focus on making omnichannel shopping sustainable and profitable.

Grocery retailers must do more than simply having an e-commerce option — they need to ensure a trusted, convenient shopper experience. The question of whether a grocery operation should engage in e-commerce is moot — the more pressing question has become, what does a retailer need to do to enable optimum e-commerce and omnichannel operations? The question, as dealt with here, excludes Mom and Pop operations and specialty shops, and focuses on mid-market and larger grocers. 

Beyond the obvious concerns surrounding shopper experience, successful grocers are focused on supply chain, inventory, automation, sensors, warehousing, and logistics — data-intensive challenges that all require modern network solutions connectivity to be met efficiently and effectively.

Grocery is traditionally a low-margin business, so investing in new technologies to compete and grow omnichannel revenue streams is challenging, but critical to their success. Yet, adopting new technologies and maintaining shopper expectations regarding safe, secure in-store POS, website and mobile shopping experience and convenience can all build greater customer loyalty.  Connectivity everywhere, but most notably while shopping in-store is a major concern and can become a point of differentiation. That connectivity should offer reliable, cost-effective bandwidth networking capabilities to answer the needs of the modern grocery retailer, in terms of low latency and security in customer interactions and data handling.

Retailers today need deeper or faster interaction with customers and all elements in the supply chain, which also further reinforces the need for low-latency application performance. They will need to buttress security measures that ensure PCI DSS (Payment Card Industry Data Security Standard) compliance for card transactions and emerging software-based payments solutions, which may warrant consideration of managed network services to reduce the burden on their over-extended IT team. Further, omnichannel players need to support connected devices with superior WiFi and digital features in addition to business-critical applications.

What grocers need to know when considering network infrastructure

Understand usage trends:
Effective planning begins with knowing current network utilization, where this traffic is coming from and how it’s trending. Having full visibility into network usage over time gives IT leaders and their technology partners the insight needed to plan successfully. 

Anticipate growth:
Consider what new applications your network will need to support in the next few years, that aren’t being supported now. Talk to stakeholders to learn what capabilities grocery shoppers expect and what innovations might be coming down the road.

Create a path for expansion:
Design and implement flexible networks that match current demands but can easily scale to support future requirements. Making small, incremental improvements every few years is much easier than having to replace your entire infrastructure. Choose a network connectivity partner that offers growth opportunities.

Six things to consider when choosing a network partner
Successful omnichannel grocers rely on digital infrastructures capable enough to support the proliferation of supply chain data while providing the scalability needed to meet the ever-expanding expectations of customers. When your organization issues an RFP to help determine how best to meet the challenges of e-commerce and omnichannel sales, grocers should be sure their organization can count on the following from their prospective partners:

1. Omnichannel experience
Look for a solutions partner with experience integrating locations nationwide with a fiber network built to accommodate the data-intensive technologies of the modern grocery retail stack.

2. Mission-critical connectivity
Use a network provider that can offer end-to-end performance management and a strong service level agreement (SLA) for uninterrupted service to in-store applications, supply chain communications, e-commerce operations and organization-wide analytics.

3. End-to-end security
Consider a private network with enhanced security features that can move data securely and efficiently among stores, fulfillment centers, logistics partners and the cloud.

4. Wide-ranging solutions
Choose a partner with services that cover diverse use cases, such as unified communications to help business teams collaborate and managed WiFi for dependable device connectivity in grocery stores.

5. Dedicated support
Give every location and each link in the supply chain peace of mind with round-the-clock support and local, knowledgeable technicians to work on essential IT systems.

6. Prioritizing traffic
Look for a network solution that supports traffic prioritization and can route applications based on business intent. For example, your network infrastructure should be flexible enough to optimize performance by prioritizing mission-critical activity traffic, while deprioritizing things like video or non-shopping related web-browsing.

Spectrum Enterprise Dedicated Fiber Internet and Ethernet provides reliable connectivity based on dedicated connections for your organization over a private, advanced fiber internet network. The service level agreement (SLA) offers assured confidence that your organization will have 99.99 percent service availability, as well as low latency with bandwidth that scales up to 100 Gbps.

Go here to learn more about Ultra High Speed Data connectivity.