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Aldi is rolling out grocery delivery across the US in a direct assault against Walmart, Amazon, and Kroger

Aldi is expanding grocery delivery to stores across the US and launching a test of curbside pickup, the company said Tuesday.

With the national rollout, roughly 80% of Aldi stores will offer delivery through Instacart by the end of the year, Aldi US CEO Jason Hart said in an interview with Business Insider.

Aldi started testing grocery delivery in select cities last year through a partnership with Instacart. Until this week, the service was only available in a few markets, including Atlanta and Chicago.

Aldi will also start testing curbside pickup in early November, the company said. Curbside pickup allows shoppers to buy groceries online and then pick them up at stores, where employees will load the bagged items into their cars.

“More than ever people are pressed for time and money,” Hart said. “Our partnership with Instacart and the expansion of our e-commerce options are more ways we are meeting the growing needs of today’s shopper, who wants high-quality food at unbeatable prices.”

To celebrate the rollout, Aldi is giving first-time Instacart customers $10 off their first three Aldi orders of $35 or more with the code ALDILOVE.

Aldi is slowly ramping up its investment in grocery delivery and pickup amid fierce competition from Walmart, Kroger, and Amazon for consumers’ online grocery purchases.

Walmart plans to offer grocery delivery from more than 800 stores by the end of the year, and it offers curbside pickup at more than 1,500 locations.

Kroger is in a close race with Walmart: it’s now delivering groceries from nearly 900 stores and plans to grow its curbside pickup locations by nearly 500 stores this year, from nearly 1,100 locations now.

Amazon, meanwhile, is in the process of rolling out grocery delivery from Whole Foods stores across the US, and recently announced it was launching curbside pickup at select stores in as little as 30 minutes from the time of purchase.

Source: Business Insider

Cigna Deal Gets Antitrust Nod, Positive Sign for CVS/Aetna

Health insurer Cigna Corp’s $52 billion acquisition of pharmacy benefits manager Express Scripts Holding Co has passed U.S. antitrust scrutiny, the companies said on Monday, allowing them to proceed with a combination they say will lead to lower costs by better coordinating pharmacy and medical benefits.

Wall Street analysts had expected antitrust approval as the companies have little overlap in their businesses. The decision bodes well for the pending U.S. antitrust review of CVS Health Corp’s proposed $69 billion acquisition of health insurer Aetna Inc.

The new company will marry Cigna’s business of managing health plans for corporations and the government with Express Scripts’ role handling pharmacy benefits for those same customers. Express Scripts also owns specialty pharmacies that distribute pricey drugs.

“We are pleased that the Department of Justice has cleared our transaction and that we are another step closer to completing our merger,” Cigna Chief Executive David Cordani said in a statement.

The Justice Department review of CVS’s planned purchase of Aetna may conclude this month, but will take longer because of divestitures needed to resolve competitive concerns, a source familiar with the matter told Reuters.

CVS spokeswoman Carolyn Castel said the company continues to expect to close its deal late in the third quarter or in the fourth quarter, a forecast it gave investors on Aug. 8 during a conference call.

The Justice Department in 2016 successfully blocked a pair of large health insurance mergers it believed would limit competition in the industry. Those were Aetna’s plan to acquire smaller U.S. health insurer Humana Inc for $37 billion, and a planned $54 billion combination of insurers Anthem Inc and Cigna.

Aetna and Cigna, however, were determined to seek growth through deals while responding to a changing healthcare landscape, eventually targeting mergers with the nation’s largest pharmacy benefit managers (PBMs).

“We believe these two transactions add more pressure on Humana to move further down the path of vertical integration,” William Blair analyst John Kreger said. “We suspect other health plans will look to follow suit.”

Antitrust experts have described the current deals as vertical combinations that present fewer issues than the failed insurer mergers. That view was bolstered after the Justice Department lost its case to stop AT&T’s acquisition of media company Time Warner. The department is appealing the decision.

“Everyone is feeling the pressure right now … to react to disruption in the healthcare industry,” said Brad Haller, a director in West Monroe Partners’ mergers & acquisitions practice.

That disruption includes Amazon.com Inc’s moves into healthcare. The world’s largest online retailer purchased online pharmacy PillPack, which Wall Street analysts say can help it undercut traditional prescription drug sales.

Amazon has also aligned itself with JPMorgan Chase & Co and Warren Buffett’s Berkshire Hathaway Inc to experiment with new business models for employee healthcare – one of Cigna’s target markets.

Cigna’s purchase of Express Scripts comes as PBMs’ role in prescription drug costs has come under scrutiny.

The administration of U.S. President Donald Trump has said it is looking at how so-called industry middlemen and pharmacies such as Express Scripts and CVS impact drug costs for U.S. consumers. The administration is looking at implementing a rule that could change or eliminate the use of rebates from drugmakers to PBMs that critics say contribute to higher drug prices.

Cigna and Express Scripts said they have already obtained clearances for the deal from departments of insurance in 16 states and are working with regulators in remaining jurisdictions to obtain clearance for the merger.

“States could still conduct a public hearing … though it is very unlikely that they do not align with the U.S. Department of Justice’s decision,” Leerink analyst Ana Gupte said.

The companies continue to expect the deal to close by the end of the year, subject to the satisfaction of all closing conditions.

Cigna shares closed up 1.4 percent at $197.84, while Express Scripts shares closed up 3.7 percent at $95.23. CVS and Aetna shares also rose, closing up 1.5 percent and 1 percent, respectively.

Source: U.S. News

Experience is Crucial in the Grocery Store of the Future

Think click-and-collect is cutting-edge? Think again.

How about a supermarket that shoppers can actually drive through — not up to a pickup window, but right up to the shelves?

A Russian inventor actually holds a patent for such a concept, which has made the rounds on social media. Shopping motorists actually pick products off rotating shelves from behind the driver’s seat, dropping items onto a conveyor belt that whisks them off to checkout, where the shoppers pay their bills and speed away, without ever getting out of their cars.

Is this the store of the future?

Despite the growth of ecommerce, shopper insights indicate that most consumers still like a brick-and-mortar store experience that delivers sights, sounds and smells, perhaps allowing them to linger over a cup of coffee, a full meal or a cooking demonstration.

But the broader picture indicates that most grocery consumers want a seamless experience — the ability to purchase goods in person, online, or by employing click-and-collect or delivery, as their needs and circumstances warrant. To be sure, industry experts agree that experience is paramount in creating a place that shoppers want to be, out and away from their computer screens.

So while you likely won’t see cars driving into every grocery store any time soon, it could be just one component of a larger, increasingly diverse picture of a continually evolving store of the future.

A frictionless experience has been a key focus. Retailers have experimented with self-scanning devices to help shoppers avoid lengthy checkout lines, and Amazon is rolling out cashier-free stores that leverage tech to track purchases and total cashless basket rings.

And as consumers find it easier to purchase center store goods and nonfood items online on demand or with subscription services, grocers are looking at how to reallocate valuable space to augment fresh perimeter categories that many shoppers are still wary to trust to delivery services.

Ultimately, grocery stores must be solution centers, and retailers must keep a constant watch on consumers’ rapidly evolving needs so that stores can stay one step ahead of them.

Progressive Grocer consulted industry experts to get a better understanding as to exactly what “store of the future” means to consumers, the business of selling food, and their symbiotic relationship. Here’s what they told us …

Engaging shoppers, whether through sampling at community tables or leading group dances to celebrate a fresh batch of chicken (above), demonstrates a retailer’s commitment to an experience that transcends the mere selling of wares

AN ENTIRELY NEW CUSTOMER EXPERIENCE

Looking back 10 or even five years and comparing that shopping experience to today’s retail reality, the difference is vast. As frictionless checkout and delivery become commonplace in grocery conversations, one can’t help but ask, what does this mean for the future of grocery? With providers teasing the democratization of frictionless checkout, which could enable adoption by the masses and not just the likes of Amazon, there’s much to discuss.

“Many of our grocer clients are realizing successes by leveraging tech that blurs the line between digital and brick-and-mortar,” says Steve Duffy, VP of grocery for Orlando, Fla.-based Cuhaci & Peterson Architects, Engineers and Planners. “In order to be where their consumers are, they have to virtually be omnipresent. The question is no longer whether or not to delve into omnichannel, it is determining which channels to focus on.”

Duffy continues: “We are creating an entirely new customer experience for grocery and food, end to end. We are challenged with literally understanding the implications of the product, the freshness and the reality of getting it into the consumer’s home.”

Successfully getting food to consumers’ homes — the “last mile” — is “a battleground of epic proportions,” says Cuhaci & Peterson Principal Steven Blevins.

“This is an arena with fierce competition, and even fiercer challenges to making sure it is both a profitable and viable venture for grocers,” Blevins says. “Artificial intelligence and robotics are helping overcome some of the challenges, but the paradigm shift to stay close to customers, increase automation and do this at a scalable level is a conundrum that requires agility to overcome.”

Eric Thorsen, who leads global business development in retail and CPG for Santa Clara, Calif.-based tech company Nvidia, sees significant interest in using new technology like GPU (graphics processing units) in the retail industry.

“Retailers are interested in computer vision to monitor shoppers, prevent loss and enable a cashier-free departure,” Thor-sen says. “This keeps in-store associates focused on contact with the consumer, rather than ringing registers. The end result is a more personal interaction, assisting customers with questions and providing advice on products. Customer satisfaction improves, and revenues increase as a result.”

And while there are more and more ways to obtain product (in-store, pickup, driveup, delivery), one added trial for grocers is maintaining relevance across multiple generations, all with varying levels of comfort with omnichannel options. Whether that’s through innovations that allow small to midsize grocers to embrace frictionless technologies, the improvement of micro fulfillment and last-mile capabilities, improved experiential shopping for increased brand engagement, or creating a “digital twin” to allow omnichannel consumers to have a “virtual” shopping experience, keeping up in an environment that’s undergoing seismic technological changes will set industry players apart moving forward.

“As retail store designers, creating an effective, stimulating experience involves stirring emotions to form powerful bonds with the target demographic,” says Lewis Shaye, founder of South Carolina-based Grocerant Design Group and former VP of culinary concepts for the Schenectady, N.Y.-based Price Chopper supermarket chain. “A brand refresh on its own is not powerful enough to cause people to feel remarkably different; it won’t deliver the results long-term. Unlocking the unique differentiators that drive people to shop with a particular retailer and using technology to target unmet needs in the marketplace will be what sets apart the store of the future.”

Duffy says a store-of-the-future design “takes the optimal shopper’s various needs and ability to acclimate to the disruption in new retail into consideration. Their future interactions with both the physical and virtual store worlds help shape our vision of what this future store could be.”

Five primary strategic underpinnings are central to change and are no longer considered trends, according to Duffy: technology, convenience, experience, fresh food and local.

Future grocery design will be significantly affected by technological advances like artificial intelligence, machine learning and robotics. The compounding effect of these multiple technologies bears great significance in the rate of change, as well as what can arguably be described as a metamorphosis into the next grocery design innovation curve.

This becomes key to bear in mind for traditional grocers, especially the smaller or regional operator; obtaining a complete understanding of current trends and coming innovations as they develop a strategic game plan will play an integral role in harnessing the operational efficiencies needed to maintain viability in tomorrow’s marketplace.

Other technological advances involve store infrastructure improvements, including predictive equipment, energy efficiencies in lighting and refrigeration systems, and possibly augmented or virtual-reality options that give consumers a wealth of information about products.

“As the demand for fresh and local options expands, the ability to provide more sophisticated and accessible information may bring about ‘digital twins’ as one way to fulfil this demand,” Blevins says. “Imagine consumers being able to ‘virtually’ walk through a store and take their time to look over new products without ever leaving their home. With advancement in BIM [building information modeling] technology, this is something that is not far off.”

To deliver a compelling, experiential and customizable shopping experience, as the evolution of grocery intensifies, grocers must maintain an advanced technology store platform and remain agile enough to provide the best of online and in-store shopping in a dynamic retail environment. Together, all of these elements coalesce into a store of the future that engages on many levels, and one that can win in the new retail frontier.

EXPERIENCE IS THE CENTRAL FOCUS

“One of the biggest trends that we are noticing across all retail project types is customer experience,” says Jeffrey Nader, project director at Tampa, Fla.-based design firm API(+). “Experience has become the central focus of the design process. Maximizing store layouts with an emphasis on product placement is no longer the focus of the user experience. Instead, the design process has become human-centric, with careful attention to how the public enters and engages with spaces.”

Nonprice factors are going to be the biggest differentiators among traditional grocers, Nader asserts.

“A strong focus on quality, freshness, customer service and a unique shopping experience are key elements that are shaping the path for a competitive playground among traditional grocers,” he says.

One of the most important technologies that stores of the future will need to employ, according to Nader, is a robust consumer relationship management (CRM) platform that manages critical customer information unique to the grocer’s brand.

“It will create a single source of information that will increase sales efficiency, boost sales and improve forecast accuracy,” he says. “These tools have built-in algorithms that crowdsource information from various outlets, including social media, mobile applications and geo-located foot traffic.”

In addition to the current key personnel that maintain today’s retail establishments, stores of the future will have a more specialized and highly skilled workforce such as health experts (including dietitians, nutritionists and macrobiotic experts); in-store chefs and food prep experts; and shopping guides.

“This futuristic workforce will function as a group of go-to experts that will guide the customers on what to buy and how to store it,” Nader says. “Along with a highly skilled workforce, stores of the future will rely heavily on the Internet of Things, allowing them to better predict consumer demands and manage inventory across a network of stores.”

Additionally, Nader notes, grocer innovation will play a key role in reshaping customer satisfaction by concentrating efforts on creating a more modern shopping experience. He observes, “Experience will improve with focus on eliminating hassles such as long checkout and customer service lines, and those time-consuming aisle searches for products that are sold out or nonexistent, among other demotivators.”

“There is so much change happening that current supermarket formats need to be fundamentally reconsidered to respond to a new role they serve. Grocery stores of the future will offer innovative, customer-centric shopping experiences to meet needs and demands of modern shoppers.”
Dr. Pallab Chatterjee, Symphony RetailAI

CUSTOMER-CENTRIC SOLUTIONS

While a multitude of factors are influencing store design, “it ultimately comes down to the need to better serve evolving customer lifestyles and preferences to create more convenient and engaging in-store experiences,” says Dr. Pallab Chatterjee, chairman and CEO of Dallas-based artificial-intelligence solutions provider Symphony RetailAI.

Weekly pantry-loading trips have declined in favor of quick trips and online shopping, and time-starved customers increasingly place a greater value on prepared foods and grab-and-go options. Discounters are also challenging traditional grocery stores, not just bringing lower prices, but also introducing new paradigms for what a grocery store experience can mean.

“There is so much change happening that current supermarket formats need to be fundamentally reconsidered to respond to a new role they serve,” Chatterjee says. “Grocery stores of the future will offer innovative, customer-centric shopping experiences to meet needs and demands of modern shoppers.”

A primary challenge for traditional grocers is that current store layouts no longer meet the demands of today’s customers.

“Ultimately, a wide variety of steps can and should be taken, but they all require that traditional grocers place customer experience as the foundational driver and rationale for change — and smarter data management is the linchpin that will make it happen,” Chatterjee asserts.

To compete in the near future and in the long term, the store of the future must emphasize a host of customer-centric features.

“This will require that grocers reconsider the role of space within the store, the impact of multichannel and convenience shopping on the center store, and the potential for internal- and customer-facing technologies to improve the experience across the board,” he says. “Finding the right approach for each store and local market will require deep insight into owned business and customer data, along with partner/supplier data, which AI-enabled systems will be increasingly critical to manage.”

Stores of the future must employ technologies that help customers get what they want, when they want it, in an environment that they enjoy, Chatterjee says.

“They will increasingly rely on technology to reduce friction in traditional processes, using AI-enabled systems to predict customer needs and manage assortments, promotions, associate responsibilities and more,” he notes. “AI will be essential, as only the grocers who are able to predict behavior can create the conditions customers demand.”

Beyond smarter data management, retailers also need to reduce the friction across customer touchpoints and ensure that multichannel shopping journeys are a cinch.

One essential service in this regard will be click-and-collect, according to Chatterjee.

“Today, as more customers start their shopping journeys online, grocers are identifying follow-on benefits from offering this service by optimizing store layouts to adjust to new foot-traffic patterns. For example, they might relocate their pharmacy near a click-and-collect counter for fast collection, deploy a prepared-meal counter close by, or create a drive-through lane that keeps the customer’s time investment to a minimum,” he says.

For traditional shopping trips, the checkout is another area rapidly changing through technology.

“As revealed in Symphony RetailAI’s ‘Supermarket 2020’ research, we expect self-service kiosks to make up 80 percent of checkout lanes by 2020, with only 20 percent remaining manned,” Chatterjee observes. “This allows for more lanes, faster checkouts and happier customers.”

In response, the grocery workforce will become more optimally deployed, moving from transactional to value-driving roles.

“As checkouts and other processes become automated or self-service, associates will be positioned as click-and-collect pickers, prepared-food chefs and mobile customer support staff,” Chatterjee predicts.

Customer experience will also move from transactional to experiential, as retailers create more enjoyable spaces, better convenience and new services.

“The barriers between the digital and the physical will break down with services like click-and-collect, but also the presence of touchscreens on in-store tables where customers can gather and consume prepared meals,” Chatterjee says. “These touchscreens will allow customers to engage with new products online, scan loyalty cards, and search for new offers and promos as they eat. The store will serve multiple purposes, ranging from ultra-convenience to ultra-experience.”

From a supply chain perspective, AI will help create far more intelligent assortments and demand forecasting to help customers find the products they want, increase the value of fresh produce and meat, and allow for special product aisles with assortment changing twice a week to surprise and delight the maximum number of customers, Chatterjee notes. “The supply chain will become increasingly intelligent, agile and customer-serving, while limiting the waste and slow adaptations to customer demand that often occur in grocery today,” he adds.

Chatterjee expects these concepts to quickly become reality as retailers identify the value of these changes and customer expectations continue to become more demanding: “We expect the store of the ‘future’ to resemble this vision by 2020.”

Grocery stores should deliver an environment that reflects the neighborhood they serve, including design, decor and graphic elements that set the tone for the shopping experience

ADAPT TO MARKET TRENDS FASTER

Increasingly thinking like specialty stores, grocers are “taking a bigger interest in designing spaces that cater to different shopping missions,” says Mark Hardy, CEO of Chicago-based retail optimization solution provider InContext Solutions. “So they’re testing new aisle layouts, product groupings and store configurations to see what resonates best with their shopper base. Taking a cue from Target and others, they’re trying to learn if they should develop special sections for quick shopping and online pickup areas. They’re [also] trying to decide what signage and technologies resonate best.”

According to Hardy, one of the most important factors for grocers going forward will be agility.

“The ability to move quickly and make changes on the fly will be key in keeping on top of the ever-changing landscape,” he says. “Ecommerce has traditionally held the upper hand when it comes to being agile — websites can be easily updated, products can be switched out in seconds, promotions and discounts can be applied and communicated instantly. Brick-and-mortar grocers have the benefit over online grocery right now, but they are going to need to look to technology to help them adapt to market trends faster.”

Helping grocers keep up are mixed-reality solutions, which are InContext’s stock in trade.

“We know mixed-reality solutions — including virtual and augmented realities — are changing retail dynamics for our clients by enabling faster, lower-risk and higher shopper-impact decisions at the speed of thought,” Hardy notes. “Virtual simulations have quickly become a game-changing tool for visualizing and testing new in-store concepts before having to create any physical prototypes or mock stores. It also enables teams to collaborate within an immersive virtual space from anywhere in the world, saving the time, expense and headache of travel.”

Artificial intelligence (AI) is also going to be increasingly important to brick-and-mortar stores.

“Not only for things like frictionless checkout and more seamless shopping experiences, but taking a cue from Amazon and really leveraging AI for data collection and interpretation will be an integral part of retailing,” Hardy says. “AI in the field of agriculture — creating predictability for farmers and their produce — will have a big impact on the quality and availability of food at the supermarket. Predictive analytics is going to open up hundreds of doors we haven’t even come to yet.”

While technology will help retailers eliminate tasks so they can focus on other things, Hardy observes that “what it will also do is create new avenues for people to hone new skills and expertise. For example, the supply chain will become digitized. Procurement could be done through 3D and mixed-reality content, which will cut down on time and travel, and allow the buying and planning process to become faster and more efficient.”

Customer experience will continue to become more fluid between online and in-store.

“We’ll no longer have to weigh the pros and cons of ordering online versus buying in-store — same-day free delivery, in-store pickup and matching price points will make shopping easier and more cohesive for the customer,” Hardy says, “and we’ll need the workforce to meet those demands.”

Source: Progressive Grocer

Why Amazon’s Grocery Store May Not Be the Future of Retail

When Amazon opened its cashier-less concept grocery store to the public in Seattle on January 22, the company’s stock rose 2.5% – slightly more than the 2.4% increase after Amazon announced that it was buying Whole Foods this past June. Does Amazon Go signal that smartphone apps and virtual carts will replace checkouts in grocery stores?

A low-cost, automated store is certainly an experiment worth watching. But retailers shouldn’t rush to rip out their registers just yet. Retail is littered with promising technologies introduced with great fanfare that didn’t become mainstream because they didn’t sufficiently benefit either the retailer or the customer.

One reason is that new tools often don’t save the retailer enough or generate sufficient new revenue to cover their cost. Another is that too many customers simply don’t like them. To become the new normal, a technology has to make it beyond the early adopters – typically 10 to 15% of retail shoppers – and appeal to the less tech-savvy majority.

Amazon Go may face challenges in both respects: It is unclear its eventual savings will justify the investment, or whether customers will find the digital surveillance it entails to be a tolerable price to pay for an improved shopping experience. Our surveyof 1,500 British consumers revealed that 19% would consider an app that tracked them an invasion of privacy. So before adopting any technology, retailers must answer two questions: How does this benefit us? And will consumers like it? Let’s look at how retailers have — or have failed to — answer these questions.

Radio-Frequency Identification

Starting in the mid-1990s, RFID was expected to transform inventory control by using electromagnetic fields to automatically identify and track tags attached to objects. It also promised to obviate the need for manual barcode scanning at checkouts. But the tags never took off, because their cost was never offset by sufficient benefits.

Consumers were satisfied with bar scanning for most products, and retailers found better alternative processes to track their inventory. At the British retailer John Lewis, for example, store staff today can scan an item of clothing in a store to find out what sizes are available on the shelf, in the back room, and in a warehouse for online delivery, and then send a customer all the details by email.

In grocery, where checking out is the most cumbersome part of shopping, the cost of putting RFID tags on inexpensive items made the technology a non-starter. When every penny of cost matters on a case of shipped product, spending more for simple RFID tags or for intelligent tags that track temperature and other data points just does not make economic sense.

Self-Checkout

Self-checkouts have proved more successful. But more than 10 years since their introduction, most consumers choose them only if lines at conventional checkouts are a big hassle. Retailers have nonetheless embraced them where space is a constraint or labor costs are high. Self-checkouts have become commonplace in convenience stores in the United Kingdom where customers are in a hurry and other parts of Europe, such as the Netherlands, where floor space is limited. But fewer retailers and consumers in the United States consider self-checkouts worthwhile, even in dense urban areas such as New York City, because labor costs and the average value of sales per square foot are usually lower and the lines are just not that bad.

Moreover, the limits on what customers and machines can do themselves reduce the effectiveness of self-checkout. Staff are still needed to check some customers’ bags to reduce theft and to OK their IDs for buying, say, a bottle of wine. Customers find this mildly inconvenient, while retailers have to employ people, reducing the labor savings they might have expected.

Electronic Shelf Labels

Electronic shelf labels allow store managers to change price displays more easily or to have them update automatically. They are slowly catching on, but it’s taken a decade. The early tags were expensive and often difficult for customers to read, and they were only adopted in markets such as France where store staff are paid relatively well, making the labor savings compelling.

But now that upfront installation cost of the tags is declining, more retailers are experimenting. The displays are improving, allowing retailers to show more product information and promotional offers. Today’s labels also have the potential for making real-time price changes that respond to things like surges in supply or expiration dates.

Mobile Payments

There is a lot of excitement around the use of mobile phone apps, such as Apple Pay, to make payments. Many retailers are considering their own payment apps in part to avoid credit card fees and encourage customers to pre-pay for purchases before they even reach the store. But relatively few consumers use these apps. While many are comfortable with them, most still find their chip, or contactless, credit and debit cards just as easy, fast, and secure. To encourage the use of apps, some retailers, including Starbucks, are starting to offer inducements such as extra loyalty points.

The stock market was excited about Amazon Go because it signaled a promising new technology by a digital retail powerhouse that is aggressively moving into physical stores. If Amazon is right, investors are betting, the model could transform traditional retail. But it won’t happen unless the benefits to retailer and customer decisively outweigh the cost of the technology

That may not be a major concern for a deep-pocketed company like Amazon, which is perpetually trying new things, learning from mistakes, and then moving on to the next potential big thing. Amazon has already benefited from the industry buzz around its concept store, which could very well set customer expectations for the in-store experience of the future. But other retailers will most likely find the initial costs too high and benefits too uncertain to immediately follow in Amazon’s footsteps. Instead, they should watch closely and be prepared to make a move — if the system makes economic sense, and if consumers like it.

Source: Harvard Business Review

5 ways grocers are elevating the store experience

Despite all the attention on e-commerce, retailers are making sure they don’t take their eyes off their stores, which are where the overwhelming majority of consumers still prefer to shop. From tech-first innovations to a renewed emphasis on practices that have been around for decades, grocers are combining a bit of the old and a bit of the new to keep their stores relevant in the digital age.

  1. Service counters

    After the Great Recession hit, full-service meat departments went on the chopping block. According to the Food Marketing Institute’s latest Power of Meat study, the availability of full-service counters dropped from 82% of retail meat destinations in 2007 to 73% in 2012 and 2013.

    But grocers have come around to the value a fully staffed meat department provides, and now 80% of meat retailers offer this option. In addition to providing fresh cuts and a friendly face, butchers can answer the question supermarkets are increasingly looking to answer these days: What’s for dinner?

    According to the Power of Meat report, 70% of consumers — particularly baby boomers — say they value having access to a fully staffed meat department. In Sorrento, Florida, the 9,000-square-foot Mount Plymouth IGA has a full-service meat counter that’s the star of the store, according to owner Nakul Patel. His butchers offer custom orders, bulk orders and the widest selection in what’s become a very competitive region.

    “People travel from far away for our meat,” he recently told Food Dive.

    It’s not just meat that’s getting the full-service treatment. Grocers like Coborn’s, Eataly and Whole Foods staff produce butchers that prepare fruits and vegetables for consumers while they shop. And some, like Metropolitan Market in Seattle, offer in-store concierges to help shoppers plan meals.

  2. Space to sip

    From stock-up trips to quick in-and-out shops, consumers typically treat the grocery store as a transitory destination. But retailers know there’s also value to getting shoppers to slow down and spend more time inside their four walls.

    In-store bars, they’re finding, are just the ticket.

    “We have people who stop in as part of their shopping trip, but we also have customers who are coming specifically to the Tavern,” Scott Gross, general manager at Oliver’s Market, which operates four stores in Sonoma County, California, told Food Dive in an email.

    The tavern Gross referenced is Oliver’s Tavern Off The Green, a pub and eatery located at the company’s store in Windsor. Along with craft beers and bar bites, the Tavern also regularly features live music and plans a lineup of events every month.

    Whole Foods, Wegmans, Raley’s and Kroger are just a few of the chain grocers that have put bars in their stores. As part of its new $7.2 million flagship store in Boise, Albertsons opened a bar called Broadway on the Rocks that serves wine along with a selection of 36 beers on tap.

    It’s not just bars where shoppers are able to sip. Retailers like Lucky’s Market are also letting customers take a beer or glass of wine with them while they shop. Lucky’s “Sip and Stroll” program is now a mainstay at stores where regulations allow it — complete with cupholders inside its shopping carts.

  3. Hyper-local produce

    Locally grown foods are still going strong, with research firm Packaged Facts estimating the market will hit $20 billion by next year. Grocers have tapped into demand by increasing their assortment, promoting their local producers and holding “meet the farmer” style events in stores.

    Some grocers are taking local a step further by partnering with vertical farming operations like Bright Farms and Gotham Greens to source produce from mere miles away.

    And then there are some that have brought the farm to the store. A Whole Foods that opened earlier this year Bridgewater, New Jersey features a mushroom farm that generates up to 120 pounds of fungi a week for the store. Smallhold, a New York City based organic farming startup, provided the in-store cultivation display. Adam DeMartino, the company’s co-founder and chief operating officer, told Supermarket News it’s a hit with shoppers, particularly children.

    Meanwhile, Hy-Vee built eight-foot tall hydroponic “grow walls” outside its store in Davenport, Iowa last year, which supplied up to 15 pounds of herbs and lettuce for the store each week.

    Other retailers are undertaking similar projects. One of H-E-B’s Central Market stores in Dallas features a 53-foot-long Growtainer that produces herbs, leafy greens and other produce that are merchandised with “store grown produce” signs. H-E-B liked the concept so much that earlier this year they purchased a second Growtainer for another store.

    For supermarkets that don’t have space to farm inside their stores, there’s always the roof. A Rouses store in New Orleans, a Whole Foods in Brooklyn and Bi-Rite stores in San Francisco are just a few stores that feature rooftop gardens. Last year, an IGA store in Montreal built a 25,000-square-foot rooftop garden — the largest such arrangement in the entire country.

  4. Class acts

    Chuck Eggert believes supermarkets have a blind spot: They carry aisle after aisle of meal ingredients, yet they don’t show their customers how to put everything together. So when the founder of Pacific Foods decided he wanted to open a grocery store, he knew education needed to be a primary focus.

    Basics Market, which opened this month in Portland, features a large culinary classroom where shoppers can learn everything from knife skills to diabetes management. Eggert sees the classes as filling a need in the community to promote culinary skills and healthy lifestyles. But offering classes is also a business decision.

    “If we can educate them and teach them what good nutrition looks like, they’ll become loyal customers,” Eggert told Food Dive.

    Other grocers would respectfully disagree with the assertion that they’re not providing enough education. At select Martin’s stores in Indiana, for instance, seniors can learn how to cook with local ingredients, while kids can take brownie-baking classes. At Kings Food Markets in New Jersey, teens can enroll in a global fusion course that teaches them how to make dishes like chorizo egg rolls and spanakopita wontons.

    Health is a major focus. Retailers like Hy-Vee offer store tours with its many dietitians while Dave’s Supermarket in Rhode Island runs support groups and seminars for shoppers with celiac disease. Some nonprofits are enlisting doctors to run store tours for shoppers looking to improve their diets.

    As the connection between food and medicine grows, Eggert believes, so will the opportunity for retailers to solidify their connection with shoppers through education.

    “People are hungry for simpler diets, nutrient-dense meals and they’re looking to stay healthy through eating well,” he said.

  5. Skip the line

    Grocers have long known that their front ends can be a headache for consumers. But a study released last month by Forrester Research and Digimarc shows just how damaging a tedious checkout experience can be.

    According to the survey of 1,000 shoppers, 39% said they had left a store due to long lines, and 56% said they would change stores if a better checkout experience was the primary differentiator.

    “Retailers put effort and expense into pricing promotions for consumers focused on value, but they may be underestimating the true cost of slow checkout in terms of lost business revenue and diminished loyalty,” Heidi Dethloff, vice president of marketing for Digimarc, said in a statement.

    Staffing additional cashiers, installing more registers or overhauling front ends altogether can alleviate the problem. But grocers think they’ve found a more cost-effective solution in scan-and-go apps that let speed-focused customers check out with their phones.

    Kroger’s Scan, Bag, Go program, which lets shoppers use a special app or handheld scanners available at participating stores, has tested well and will be available at 400 locations by the end of the year. BJ’s Wholesale Club will offer its Express Scan program in 100 stores by the end of this year. And in New York, Fairway Market is pleased with initial tests of a mobile scanning app implemented by FutureProof Retail.

    At a time when online shopping is growing and checkout-free store Amazon Go has captured the industry’s eye, grocers are under pressure to not just alleviate checkout lines, but to make the experience enjoyable, too. Dollar General’s DG Go! app automatically applies coupons and alerts customers to additional savings while they shop. The company plans to have 250 stores online by the end of this year.

    Could skip-checkout apps eventually see widespread usage? It’s hard to say at this point. Walmart recently scrapped its Scan & Go program, which let customers pay for their items through a special app. Also, while shoppers hate long lines, research shows they do value the human interaction that happens at checkout.

Source: Food Dive

Grocers step up their game with flagship stores

In the face of today’s threats to the traditional grocery model, many grocers are recasting challenges as opportunities and finding creative ways to connect with shoppers.

One concept that has gained popularity in the past few years is the launch of flagship or specialty stores. With the backing of a corporate grocer, flagships are intended to break the mold of traditional stores, presenting shoppers with unique offerings and memorable experiences.

At Niemann Foods’ Harvest Market in Champagne, Ill., customers can buy butter made in the store’s on-site pasteurization plant. In Sacramento, Calif., shoppers at Raley’s Market 5-ONE-5 can sip a glass of wine or kombucha on tap. A remodeled Cub Foods store in Stillwater, Minn., treats shoppers to six types of popcorn, free for them to snack on while shopping.

This model of store is usually limited to just a few locations, or even a single location, and their influence is concentrated rather than widespread. So why are retailers making the investment?

For a long time, most supermarket operators focused on price and product, but today’s consumer is looking for more. Dr. Richard George, a food marketing expert who has consulted for major retailers and manufacturers, says that while everyone is talking about omnichannel and online efforts, most research suggests people still go into grocery stores. In fact, recent statistics show that while online shopping is increasing, just 30% of shoppers regularly purchase online.

“Grocers realize today that the in-store experience will be the key difference here,” George said. “What’s going to cause me to drive to one supermarket over the other?”

Customization is a key factor to win consumers over and, ultimately, George said it is time for retailers to step up their game. Flagship stores are one way to do that.

Neil Stern, senior partner at consulting firm McMillanDoolittle, told Food Dive that there are likely three main reasons that the industry is seeing flagship and specialty stores pop up right now. First, grocers are trying to reach the next generation of consumers who want products and shopping experiences different than the traditional offerings.

“The strategy is to find a way to grow when we might be running out of room for conventional stores, and to reach a new generation of consumers who might not be as responsive to those stores,” Stern said.

He adds that flagship stores can be a useful option in areas where it is more difficult to place a traditional grocery store, whether because of the size of the area or the neighborhood’s needs. Lastly, Stern says these stores can be used as learning labs to test new products and programs that can impact the rest of the chain.

A bar with a view

Earlier this summer, Albertsons opened a $7.2 million experienced-focused store on Broadway Avenue in Boise, Idaho, also the home of its corporate headquarters.

The store is a novelty. Here, shoppers can discover new wines in a state-of-the art wine cellar, or choose from a meat and seafood selection larger than any other Albertsons store in the region. There is also a chocolatier, a high-end deli and a bakery featuring made-from-scratch selections, and a large dining area to enjoy freshly prepared food. A full bar upstairs with indoor and outdoor seating offers views of Idaho’s Treasure Valley foothills, as well as Albertsons Stadium at Boise State University.

“This store is so unique that we like to call it a destination food getaway,” John Colgrove, president of Albertsons Intermountain Division, told Food Dive. “It’s more than a grocery store; it’s a gathering place.”

Colgrove said that while the store attracts everyone from employees at nearby businesses to students from Boise State, ultimately it is designed around foodies and people seeking a different experience.

“In the Treasure Valley, we have 23 Albertsons stores. So to build another store would have just been O.K.,” Colgrove said. “When we decided to build this store, we wanted to offer something unique and fresh and different.”

Hy-Vee is another grocer with an eye on innovating through specialty stores. Last year, Hy-Vee opened Fourth + Court, a flagship store in downtown Des Moines, Iowa, in an effort to move beyond the traditional grocery model. This summer the grocer made another move to the specialty store format, launching Hy-Vee HealthMarket. The first HealthMarket location opened in July in West Des Moines, and there are plans for additional stores in the future.

While the average Hy-Vee market is approximately 90,000 square feet, Hy-Vee HealthMarkets will be around 18,000 square feet. The store will feature traditional products such as produce, meat, seafood, and dairy items, and will also include more health-related products and amenities, according to Tina Potthoff, Hy-Vee’s vice president of communications.

“Many customers are looking to live healthier lifestyles while also having more convenience so they can spend time on the things they truly enjoy,” Potthoff told Food Dive in an email. “The Hy-Vee HealthMarket offers products and services to meet all of their health and wellness and personal care needs – all in one spot.”

The market will include a full-service pharmacy, a health clinic, a hearing aid center, a sports nutrition area and an online pickup site. It also features a hydration station with nitro coffee, Kombucha and infused waters as well as specialty beauty products. An Orangetheory Fitness studio is adjacent to the store.

New wave of an existing concept

Despite the current surge of flagship stores, the concept is not new. Stern with McMillanDoolittle says that retailers have tried these in the past, and some have been successful while others haven’t. Kroger, for example, tested Main & Vine, which closed after a few years. Ahold Delhaize’s Stop & Shop banner launched B Fresh but is now closing some of those locations to integrate them with the main brand. Tops Friendly Markets operates specialty store Orchard Fresh, and Roche Bros. has its next generation of neighborhood markets, Brothers Marketplace.

With more and more consumers shopping online, and with alternative formats like discounters and dollar stores pressuring traditional models, the ability to test new concepts take on heightened importance.

For Albertsons, Colgrove says the plan is to evaluate what works well at the new flagship and possibly duplicate some of its features in other Albertsons stores.

“This is a very fast-paced industry that we’re in,” Colgrove said. “It’s cutting edge. It’s trying to always figure out where the customer is at and what the trends are. So we always need to have an offering that attracts customers to our store.”

The new store, he said, has been met with tremendous positive feedback. Colgrove says there is a section near the entrance of the store that the team has dubbed a “wow” line because of customers’ reactions when they walk into the store.

“It was unprompted, but we would watch customers and the first word out of their mouth when they crossed that line was ‘wow,’” Colgrove says.

Source: Food Dive

Walmart’s Jet.com relaunches site with focus on urban shoppers, same-day grocery delivery

Jet.com, the e-commerce site Walmart acquired in 2016 for $3 billion, is relaunching itself today with an upgraded look and assortment, as well as a stronger focus on serving the needs of shoppers in urban metros. The site’s updated catalog now features an assortment that’s more relevant to city shoppers’ interests across categories like grocery, home, fashion, beauty and electronics, the company says. It will also introduce 3-hour grocery delivery as a challenge to Amazon’s Prime Now.

Specifically, the site will now be localized to the city where the shoppers live.

This localization involves the use of localized imagery and messages on the homepage and elsewhere, as well as Jet’s decisions about what products are featured in its assortment for that region. The site will also transition from a daytime theme to a nighttime theme as the day progresses.

These localization efforts begin with New York, but will roll out to other cities over time.

According to Simon Belsham, President of Jet.com, the Northeast will be a priority. After NYC, it will local sites for Boston, then Philadelphia, then D.C.

The site will also focus on helping shoppers more easily reorder items and will be personalized to shoppers’ own preferences, in terms of things like product recommendations and when reorder reminders appear.

And it will tailor its shopping experiences for each product category in different ways.

“The way consumers are inspired by and shop for fashion is very different than food,” Belsham explains to TechCrunch. “When shopping for fashion, consumers want to shop the look, shop select styles and see the styles on real people so imagery and video are important.”

“For food, they want to see the brands and the products and confirm they will be fresh and quality,” he continues. “They also want to save time and get their weekly grocery needs plus stock up items. So it’s important for the imagery to be clear and crisp and offer scheduled delivery windows that consumers can get at a time convenient to their busy lives,” he says.

Voice computing is another key focus, but Walmart isn’t going to leverage rival Amazon.com’s Alexa platform for that, of course. Instead, it will allow iOS users to build lists using Siri voice commands.

For example: “Siri, add bananas to my grocery list.”

Another big shift for the revamped Jet.com is its new offering of three-hour same-day grocery delivery and next-day delivery options. Delivery will be provided through most of New York City via Parcel, the last-mile delivery startup it acquired in 2017 with the intention of launching same-day delivery in the city.

At launch, the majority of New York City customers will be able to select 3-hour delivery of groceries and other everyday essentials, including those from local and small businesses, like Bedford Cheese Shop, Pat LaFrieda meats, Orwashers Bakery, Big Gay Ice Cream, and Just Bagels. The decision to work with area businesses is similar to how Amazon Prime Now works with local shops, grocers, and restaurants.

Online grocery customers will be able to give Jet.com instructions on where to leave items, and groceries will arrive in recyclable, insulated bags that keep foods cold for up to three hours.

While not necessarily related to city shoppers’ needs, Jet also today announced a strategic partnership with Nike that will see the site offering online consumers a selection of Nike and Converse products in a fully-branded experience.

The debut assortment will include hundreds of products across apparel, footwear and accessories for men, women and children, including essentials for running, training and sportswear, Jet.com says.

Fashion and apparel is one of the top-growing categories online and more retailers have figured out how to get shoppers to buy products that usually require try-on through innovative programs, like Amazon’s home try-on service, Prime Wardrobe, or through leveraging their brick-and-mortar footprint for returns. Brands, meanwhile, have benefitted from the exposure provided by being available to consumers through these e-commerce giants’ sites. For example, Lord & Taylor just set up shop on Walmart.com and just days ago, J.Crew announced it was launching a storefront on Amazon.

Despite these moves to prioritize the needs of urban shoppers, Jet.com will not close down its site to shoppers outside major metros. The site will remain available to all consumers nationwide, Belsham says.

“I am so excited to relaunch Jet to consumers today,” said Belsham, in a prepared statement about the launch of the updated site. “As a retailer, we must build experiences that customers love and trust, backed by strong values. For Jet, this means offering a more tailored shopping experience combined with a unique assortment of great brands in a way that brings empathy back into e-commerce. This is only the beginning for Jet,” he said.

Source: TechCrunch

Stealing From a Cashierless Store (Without You, or the Cameras, Knowing It)

One recent afternoon, the city’s newest grocery market was trying to figure out whether I would buy, steal or leave behind a bag of white Cheddar popcorn — and so was I.

On its side: 27 cameras along the ceiling and a wealth of behavioral data.

On my side: crippling indecision.

Last week, San Francisco got its first completely automated cashierless store, Standard Market. Shoppers who have downloaded the store’s app can go into the 1,900-square-foot space, grab items and simply leave. There is no check-in gate, and there is no checkout swipe. Ceiling cameras identify the shopper and the items, and determine when said items leave with said shopper. Or, at least, that’s the idea.

The start-up behind this operation is Standard Cognition, which has raised $11.2 million in venture capital and formed partnerships with four retail chains around the world. This first market is a prototype to showcase the technology and work on the bugs. The ambitious goal is to add the tech in 100 stores a day (each day!) by 2020.

Five of the seven founders came from the Securities and Exchange Commission, where they built artificial intelligence software to detect fraud and trade violations, before starting Standard Cognition in 2017. Now these fraud experts are working to discern something equally complicated: whether I am stealing a snack.

Standard Market is the latest entry in the emerging fray of retail automation, where companies are throwing cameras, sensors and machine learning into grocery stores to replace the checkout line. In January, Amazon opened its first cashierless Go market in Seattle to the public; it has since opened more of the stores. In China, experiments in cashierless stores abound, using radio frequency identification tags and a self-checkout process that involves scanning a Quick Response code or your face.

Standard Cognition’s approach is different. It relies exclusively on the ceiling cameras and artificial intelligence software to figure out what you are buying. The cameras document shoppers’ movements, speed, stride length and gaze. The store knows when I glance at a poster and for how long. It knows if I slowed down, grabbed a chocolate bar and put it back. It knows if my body is facing the dried mangoes but my face is set on the popcorn.

And it knows (or is trying to know) when I am planning to steal.

Standard Market store manager Rebecca Schiffman with the app the store uses to track purchases.
One of the 27 cameras on the ceiling of Standard Market.

The goal is to predict, and prevent, shoplifting, because unlike Amazon’s Go stores, which have a subway turnstile-like gate for entry and exit, Standard Market has an open door, and the path is clear.

“We learn behaviors of what it looks like to leave,” said Michael Suswal, Standard Cognition’s co-founder and chief operating officer. Trajectory, gaze and speed are especially useful for detecting theft, he said, adding, “If they’re going to steal, their gait is larger, and they’re looking at the door.”

Once the system decides it has detected potential theft behavior, a store attendant will get a text and walk over for “a polite conversation,” Mr. Suswal said.

Predicting theft requires a lot of data about shoppers, much of which does not exist yet — “or at least no one is willing to give it to us,” he said.

So a few days before Standard Market opened, Standard Cognition hired 100 actors to shop there for four hours. In Japan, the team has worked with a convenience store chain, whose name it has not disclosed, in a very useful data collection effort.

Standard Cognition said that unlike facial recognition, it did not collect biometric information, a possibility that has troubled privacy experts watching the technology evolve.

The growth of cashierless technology could hurt the American labor force; there are nearly five million retail sales workers in America. But as Mr. Suswal has pitched Standard Cognition’s technology, he said, he has found that most shop owners are not looking to replace workers. Instead, they want their workers wandering the stores more, in hopes of luring shoppers back into brick-and-mortar retail.

“They all talk about new services, making shopping more fun, making it worthwhile to shop offline,” Mr. Suswal said.

And they talk about data. While a store owner can look at receipts to see who bought a generic ketchup, cashierless technology can help tell if the shopper first picked up a Heinz bottle and how long he or she looked at it. Basically, now an owner can see what a customer did not buy.

Standard Market has only 25 square feet devoted to food so far.
The store is a prototype to test the cashierless technology and work on the bugs.

On a recent Friday, a line stretched down the street from Standard Market as a bouncer at the door took in one shopper at a time for the automated experience. The store is in San Francisco’s gentrifying Mid-Market neighborhood, between Chanvi Eatery, a Pakistani restaurant, and Huckleberry Bicycles, a high-end bike shop. People outside were downloading the app and typing in their credit card numbers.

Walking out was Yoshimasa Takahashi, 32, who works nearby in finance. A receipt popped up on his phone. It said he had bought noodles and Kraft Macaroni & Cheese — except, he had not bought the Kraft Macaroni & Cheese.

“I was playing with it but didn’t take it out,” Mr. Takahashi said, smiling at his win over the tech.

The bouncer gave him a refund.

Inside, Rebecca Schiffman, 28, was working the floor. She had been an employee at Whole Foods when the Standard Cognition team recruited her. She liked the idea of getting out from behind a cash register and said she was unfazed about having to intervene with potential shoplifters.

“I used to do that all the time anyway,” she said.

Store hours are short for the next few weeks — the store will be open only half-days on Wednesdays and Fridays while the tech is tweaked. For now, the selection of food is extremely limited. The store has only 25 square feet devoted to food because, the founders said, they have not yet gotten the permits required for more. So there is an odd assortment of items — Fritos, Apple Jacks and Starbucks Frappuccinos — that leans heavily toward dorm-room-style snacks.

To shop, I opened my phone, which flashed blue, letting the store know I had entered. I wandered, throwing items into my tote. Then I left.

Ms. Schiffman awaits customers at Standard Market.

Outside I found Mr. Suswal. A minute went by, and a notification popped up on my phone with my receipt: one white Cheddar popcorn and one roll of toilet paper for a total of $1.19.

In fact, I had left with two bags of popcorn. I had toyed with the second bag, debated buying it, considered my dinner plans, put it back and finally took it with a quick impulsive grab. The system missed it.

“That shouldn’t happen,” Mr. Suswal said. And yet it did. He shrugged and said I had won it.

So I left with the extra 99-cent bag of popcorn, and I did not feel bad, really. Soon, Standard Cognition and others will probably get better, will perfectly detect where that snack went, and my movement will be subsumed and predicted by artificial intelligence’s endless data maw.

But for now it’s not quite good enough. And I’m covered in crumbs.

Source: The New York Times

Paying Is Voluntary at This Selfie-Friendly Store

First there was self-checkout. Then Amazon’s cashier-free Go stores. Now there’s pay when you feel like it — we trust you.

At Drug Store, a narrow, black-and-white-tiled store that opened Wednesday in Manhattan’s Tribeca neighborhood, there is no cashier or checkout counter. Anyone can walk in, grab a $10.83 activated-charcoal drink and leave.

But the beverages, typically sold online by the case by Dirty Lemon, a start-up that runs the store, are not free. Dirty Lemon has made a bet that customers will pay the same way they order its pricey lemon-flavored drinks for home delivery: by sending the company a text message.

In the store, customers are expected to text Dirty Lemon to say they have grabbed something. A representative will then text back with a link to enter their credit card information, adding, “Let us know if you need anything else.”

Zak Normandin, the company’s chief executive, said he was not worried that Drug Store’s honor system would encourage theft. “I do think a majority of people would feel very guilty for continuing to steal,” he said in a recent interview at the store.

When asked how much money Dirty Lemon was willing to lose to theft, Mr. Normandin demurred, noting that the company would write down any losses as sampling costs.

Founded in 2015, Dirty Lemon counts 100,000 customers, around half of whom order at least a case of six beverages each month. Its high prices, text-message ordering and beauty claims are helping it get attention in a business littered with new health-focused drink brands. Dirty Lemon’s “sleep tonic” contains magnesium, a “beauty elixir” drink features collagen, and an anti-aging drink contains rose water.

The company is closing a round of venture capital funding from celebrities and investors, including Winklevoss Capital, Betaworks and the investment fund of the YouTube stars Jake Paul and Cameron Dallas.

Mr. Normandin said his conviction in Dirty Lemon’s store was so strong that he had already made plans to open another one in New York and two more in other cities, all featuring a separate V.I.P. lounge with a bar and special events. The company has shifted almost all of its $4 million annual digital advertising budget into its retail stores.

Dirty Lemon is forging ahead into brick-and-mortar stores when many traditional retailers are closing locations and investing in digital marketing and e-commerce. But Mr. Normandin said his customers, who are mainly young women, were tired of digital marketing that constantly pushed them to buy things. Rather, he said, they seek unique in-person experiences.

“They want to actually be kind of immersed in a brand, and take it all in, and maybe take a picture,” he said.

Dirty Lemon’s Drug Store features a large, selfie-friendly mirror that reflects a wall of coolers and stark, black-and-white-striped penny tiles creeping across the high ceiling.

So-called immersive pop-up stores and museums, optimized for social media, have proliferated in recent years. This summer, visitors to Rosé Mansion in New York wandered 14 rooms of highly stylized Instagram-bait, sharing geotagged photos, GIFs, and videos of bubble pits and cava fountains. This month, 29Rooms offers an equally Instagram-able “interactive fun house” in Brooklyn. The Museum of Ice Cream and Candytopia, both of them in New York and San Francisco, are comparably photogenic.

Mr. Normandin said his company’s plans went beyond lemon drinks and selfie mirrors to transforming the beverage industry’s distribution methods. The company aspires to “rebuild the infrastructure that has powered beverages since the 1800s,” he said.

That will take a lot of text messages.

Source: The New York Times

whole foods

Amazon expands Whole Foods delivery to 10 more cities

Amazon announced today that it’s expanding Whole Foods Prime Delivery to 10 additional U.S. cities. The full list, which includes 38 cities all told, now includes Charlotte, Las Vegas, Memphis, Nashville, New Orleans, Oklahoma City, Phoenix, Raleigh, Seattle and Tucson.

In addition to that, the retail giant has also expand coverage in three existing major markets: New York, L.A. and Dallas/Fort Worth. Those spots, along with Charlotte, Raleigh and Seattle, also have alcohol delivery courtesy of the service.

Delivery is one of a laundry list of services available to Amazon Prime users. Service is available between the hours of 8AM and 10PM and can be accessed via Echo with the “Alexa, shop Whole Foods” command.

Amazon acquired the high-end grocery chain last year for $13.7 billion. The deal helped Amazon control yet another retail vertical, taking on services like Fresh Direct with grocery delivery.

Source: TechCrunch