UK supermarket Iceland has installed a reverse vending machine in its Fulham store in London. The trial supports a government plan for return schemes to cut down on single-use plastics. The machine gives a 10 pence voucher, redeemable in-store, for each returned Iceland plastic bottle. The retailer has also pledged to eliminate plastic packaging from its own-label products. Earlier in May, the Co-op supermarket said it is going to trial a deposit scheme using machines at a number of music festivals over the summer.
[Image Credit: © Iceland Foods Ltd]
French supermarket chain Carrefour is aiming for own-brand packaging that is 100% reusable, recyclable or compostable by 2025, and to stop using non-recyclable packaging for organic fruit and vegetables by the end of this year, as well as ending the sale of plastic straws. By 2022, it intends to use 50% recycled plastics in bottles for its juice, soda and water products. The announcement coincides with a European Commission announcement to ban single-use plastics like straws and drink stirrers in the European Union. Plans also cover plastic cutlery and cotton buds, and by 2025 EU states will be expected to collect 90% of single-use plastic beverage bottles.
Retail company Target said it is more than halfway through its planned launch of its same-day delivery service with Shipt, as well as the introduction of Drive Up, a curbside pickup service. Target said it plans to have majority of its stores offering the services before the holiday season. According to the company, the services will be launched first in Chicago, making the city the first in the US to have all of the retailer’s new delivery services.
Traditional retailers have varying degrees of readiness and capabilities to compete with online retail giant Amazon.com, according to a study by market research firm Edison Trends. According to the report, Macy’s posted the strongest growth in online business in 2018, expanding by 28 percent in monthly order volume since the start of the year. Meanwhile, Sears’s online order volume dropped 25 percent from January to May.
Walmart has acquired 77 percent of India’s online retailer Flipkart for $16 billion. According to the US retail giant, the deal great improves its ability to compete in the country’s online retail market, against its biggest rival Amazon in particular. Walmart International executive vice president, president, and CEO Judith McKenna said, her company is expected to benefit from Flipkart’s online platform or ecosystem. Mckenna said Walmart also plans to integrate lessons learned from Flipkart’s operations with the company’s international operations.
Amazon.com Inc.’s June 2017 acquisition of Whole Foods Market Inc. for $13.5 billion has prompted rival food retailers to reorganize, reinvent, and recalibrate their business and sales strategies. Whole Foods has seen an increase in sales and delivery following its merger with the online retailer. This is prompting grocery chains to speed up investment plans for delivery and pickup services for their online retail operations. Also, dozens of supermarket companies have entered into agreements with online grocery-delivery service provider Instacart Inc.
Offering convenience to consumers, online retailer Amazon has disrupted the retail industry, forcing legacy retailers to rethink their strategies. Leading physical-stores retailers had to launch their own online operations, shut down significant numbers of their locations, or totally close down their business. Wharton marketing professor and author of the book, “The Shopping Revolution,” Barbara Kahn said two basic principles can help retailers make sense of the changes caused by Amazon. First, the principle of customer value, which prompts customers to “buy something they value from someone they trust.” Second, the principle of differential advantage, which means “customers want to buy from retailers who do it better than anybody else.”
International shopping-center operator Westfield introduced its Destination 2028 retail concept. According to the proposal, the company sees the future shopping mall as a “hyper-connected micro-city,” which is powered by artificial intelligence, and integrates health and wellness services and community involvement. Westfield said the concept was developed based on a growing consumer interest in health and wellness.
Grocery retailers are partnering with technology companies to improve their online retail operations and capabilities. According to UBS analyst Daniel Ekstein, many traditional food retailers need tech help to manage in-store product replenishment, shopper subscription, artificial intelligence, and even digital assistants. Although retailers own data on shopping habits of customers, they cannot use it as well as big tech companies can to create personalized offers, for example.
Microsoft and its partner, AVA Retail, are developing a technology for grocery stores that will monitor the products that shoppers pick up, eliminating the need for checkout cashiers. Originally designed to gather data about in-store shoppers, the technology is being upgraded by the partners for physical stores. Amazon could sell to other retailers its cashier-less technology, Amazon Go, which lets shoppers swipe an app when they enter a store and keeps track of their purchases. However, retailers are likely to favor the technology from Microsoft, which they see less of a competitor than Amazon.
Retailers and branded companies need to adopt Amazon’s strategies in order to compete in the online and physical-stores markets. In order to match Amazon Prime, branded companies need to create an “on-demand, always-on direct connection” with consumers using a “conversational interface.” This will enable offline retailers to come up with a “customer-focused, data-driven, real-time business.” Legacy retailers and brands should learn from Amazon’s use of machine learning and the online retailer’s focus on customer service. Also, Amazon’s digital assistant, Alexa, is fast becoming a brand influencer, making the shopping experience easier and serving as another tool for data collection.
Online retailer Amazon is reportedly wooing Brazil-based beauty and wellness brands Grupo Boticario and Natura Cosmeticos as part of its efforts to expand its online beauty business in the country. Brazil’s market for cosmetics, hair treatments, and other wellness products is worth about $30 billion as of 2018. Amazon has already been operating its online bookselling and video streaming business in the region.
Smartphones and their apps have grabbed shoppers’ attention from products on store shelves. To help regain the lost link with consumers, retailers are offering in-store experiences that completely combine with the sellers’ online operations and web stores. These enhanced retail spaces enable customers to create “virtual feeds and inspiration boards”, instead of merely encouraging them to follow their “conspicuous consumption” drive.
Seeking to lure consumers away from its rival Walmart-Flipkart, online retailer Amazon plans to launch its 2018 Prime Day sales event in India in close partnership with its US headquarters. Also aimed at driving membership in the company’s Prime customer loyalty program, the sale will feature discounts expected to be bigger than before. Amazon India is also expected to introduce its virtual fitting-room technology Prime Wardrobe, which lets consumers try fashion products before buying them.
Multinational corporations, including Amazon and H&M, are reportedly urging the state of Maharashtra in India to relax its recently approved ban on single-use plastic. Coming after Indian Prime Minister Narendra Modi’s campaign for an end to the use of single-use plastic in the country by 2022, the state’s move is expected to raise operating costs for companies. Retailers and beverage manufactures are among companies that use plastic packaging. Business groups, including the Federation of Indian Chambers of Commerce and Industry, have called on the government to soften its anti-plastic policies.
Results of a study in the UK revealed 85 percent of Amazon customers prefer the recommended Amazon product when voice shopping. Because customers view Amazon as a reliable source of product reviews and suggested products, consumers tend to accept recommended products as ideal for them. Already, marketers and brands are looking at the possibility of advertising on Amazon’s Alexa virtual-assistant platform although the online retailer has repeatedly denied it plans to allow advertising. Results of a test conducted by Bobsled Marketing on Alexa’s basis and logic order for recommending products showed products with the “Amazon’s Choice” badge are top priority. Products from the user’s order history and the first products in the search result for a search term come second and third.