Gary Hawkins with CART moderates a panel with Stacy Bowen of Associated Wholesale Grocers, Ron Bonacci with Weis Markets and Dan Jones with Northgate Markets. (Photo by Ashley Nickle)

SAN DIEGO, Calif. — Independent grocers no longer have the luxury of waiting for competitors to try out new technologies rather than jumping in and exploring the options themselves, said presenters at the Center for Advancing Retail & Technology (CART) event Feb. 23 at the National Grocers Association Show.

“Technologies like artificial intelligence and machine learning are changing the rules of the game,” said Gary Hawkins, CEO of CART. “What’s happening is leading companies that are deploying these technologies, that are building their data models, that are understanding how to leverage these new capabilities ... those companies are opening up a growing performance gap with retailers that aren’t there yet.

“The rules of competition have changed,” Hawkins said. “It is no longer safe to sit back and let somebody else do it. Whether you like it or not, you’ve got to jump in and take advantage of some of these new technologies.”

Many of the daily and weekly processes of the grocery store — deciding which new products to carry, which products to delist, how much inventory to carry, where in the store to merchandise each item, how much to sell each item for, how much each item should be promoted — will likely be automated in the near future.

“This is the type of evolution — or revolution — that’s coming, and this stuff is coming much, much faster than anyone realizes,” Hawkins said.

“Relevant offers, personalized pricing — these are the weapons of choice from this day forward,” Hawkins said, noting that retailers like Albertsons and Kroger are already employing these strategies.

Improving the customer experience by tailoring advertisements and prices to them is one element, but there is also significant value to be gained in improving demand forecasting, for example, in order to reduce out-of-stocks and shrink.

Hawkins recommended retailers consider which areas are most fundamental to their businesses and start there.

“Understand your passion,” Hawkins said. “Understand what really is driving your business and what you want to focus on. And then invest in technology and innovation behind that. Because as independent retailers — as any retailer — you don’t have unlimited resources. You’ve got to pick your battles. No retailer has got resources to do everything at once.”

Sterling Hawkins, co-founder of CART, closed the event Feb. 23 with a reminder that developing a cycle of innovation and accountability for innovation is critical.

“Innovation is not about money,” Hawkins said. “It’s not about who you know. And it’s not about being the right place at the right time. It is about discomfort.

“It’s about discomfort actually being necessary for innovation,” Hawkins said. “You cannot innovate without it because innovation is a hard thing. Hard things cause discomfort at some level somewhere along the journey, and to do hard things, as humans, the best thing for us to do is have a source of accountability to put ourselves on the line for that significant positive gain.”

 

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