I often mention in my column how important I believe partnerships will be in the evolution of the retail landscape and it seems that this is front of mind for retailers across the world currently. Whether it’s to fill a capability gap such as a fulfilment or strategic sourcing, like the recent partnership announced between Tesco and Carrefour, it seems every week there is news of such a collaboration within the sector.
Increasingly retailers are also seeing the value in strategic technology partnerships - we saw recently M&S had formed a partnership with Microsoft to explore how AI can transform the retail experience for consumers.
Such partnerships are essential if supermarkets are to meet the heightened expectations of shoppers. Consumers now benchmark their digital retail experiences with the best consumer experiences they’ve ever had - think Uber, Amazon, Airbnb. This is now the competition.
Overseas supermarkets have woken up to the challenge. Walmart has tied up with Google, allowing customers to order goods using voice with Google Assistant, with fulfilment via delivery service Google Express.
Closer to home, Google has forged a partnership with French retailer Carrefour to develop a bespoke shopping experience for food and general merchandise. Carrefour shoppers will be able to use their smart assistant to order on smartphones, the Google Home speaker and via a new Google Shopping website.
Online grocery purchases are still in the minority and only account for 4.6% of all grocery sales globally [Kantar Worldpanel]. The UK is ranked third for online grocery sales but that is still only 7.5% - significantly behind all retailed goods at 18%. Online grocery sales in France account for 5.6% of the total and the US has a lowly 1.5% penetration. Partnerships focused on improving the consumer experience will no doubt play a huge role in accelerating this adoption.
However, the role digital plays in the grocery shopping experience extends far beyond shoppers who want to transact online. Consumers make around 200 food and beverage decisions a day - ensuring they can interact with retailers in the way best suited to their requirements is crucial, whether in store, online, on smartphone or with voice.
The heart of the matter is that the mechanisms available to meet the increasingly high customer expectations of their grocery experience are not yet present at scale. Hopefully, by partnering with the likes of Walmart and Carrefour, we can play a role in the creation of magical shopper experiences that will be better than those created in isolation.
Harry Walker is industry head, grocery retail, at Google