What’s New in Retail study highlights grocery innovators

Euromonitor report picks three grocers from around the globe that are enhancing the customer experience and disrupting existing formats.
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Consultancy firm Euromonitor once again highlighted a bevy of changes that are taking place in the consumer space, with its What’s New in Retail report. Using seven criteria, ranging from innovative omni-channel strategies to new hybrid formats, Euromonitor International’s global retailing experts reviewed more than 100 submissions from its analysts worldwide to identify top concepts seen across the globe within four categories, including grocery.

From reduced-waste products to teched-out blockchain-enabled goods and a theme park for foodies, here is some inspiration from the winners of the Emerging Global Concepts Grocery category.

First place: Ekoplaza (Netherlands)

In 2018, Dutch organic supermarket chain Ekoplaza captured international attention when it opened a supermarket with an entire aisle that was plastic-free. This included 700 grocery items with packaging made from compostable biofilm.

Similar store formats have been seen cropping up in Canada too. In 2017, Ottawa’s zero-waste Nu Grocery launched. Vancouver’s Nada, which opened in 2018, is a boutique grocer that also bills itself as “no waste.” And in 2018, Toronto saw its first zero-waste grocer, Unboxed Market.

April 15, Metro announced that its grocery stores in Quebec will allow customers to shop with reusable containers.

“Given the growing prominence of plastics waste as a public concern, I think you’ll continue to see these niche providers that that appeal to a more motivated minority of consumers,” says Dr. Patrick Callery assistant professor of strategic management at Carleton University. He says the phenomenon may continue to grow over time but that widespread adoption is unlikely because consumers are reluctant to compromise on convenience (say, by pouring milk into mason jars, for example or weighing one’s own coffee). Callery cites municipal recycling as an example, which took decades of investment in infrastructure before recycling was “convenient enough to attain mainstream adoption.”

He tells strategy that Bulk Barn is a similar model in that it offers a bridge to zero-waste by allowing customers to bring their own reusable packaging while still providing single-use plastics for their other customers.

However, Callery says that Canadians are more likely to see mainstream grocers take up the mantle of product innovation which allows them to offer sustainable solutions, coupled with legislative pressures. He cites the proposed banning of single-use plastics in Ontario, with many outlets already providing non-plastic or compostable alternatives.

Second-place: 7Fresh (China)

Chinese e-com company JD.com launched a bricks-and-mortar location 7Fresh in Beijing in 2018, nabbing Euromonitor’s second-place grocery innovator spot. With a focus on fresh and ready-to-eat packaged foods, 7Fresh uses blockchain technology to track every product from production to delivery. When a customer picks up and bar-scans an item, “Magic mirrors” pop up and display the food’s nutritional information or country of origin on a screen in real-time. The company has also pioneered autonomous shopping carts, which follow customers around the store and allow them to shop hands-free.

Jason Dubroy, VP, Managing Director at TracyLocke Canada says that JD.com’s 7Fresh has completely redesigned the in-store experience and is part of what he calls “an arms race” of grocery connectivity. By contrast, he says, Canadians have been laggards on the retail innovation front, as “we’re a wait and see society.”

When it comes to witnessing comparable grocery tech developments here, Dubroy says this would require an incredible amount of capital investment, which Canadian retailers simply don’t have. He says Loblaws and Walmart have run tests of cashier-less checkouts, but nothing to the extent to which it’s being built out in China, with its WeChat app payment integration, along with facial recognition scanning at checkout, something which is unlikely to take hold in Canada due to privacy concerns.

Third-place: Fico Eataly World (Italy)

Billed as “the world’s largest food theme park” grocer FICO Eataly World’s interactive and educational shopping experience has been a big success, attracting three million visitors and generating 50 million euros in revenue for its first year of operation

Appropriately launched in Bologna, Italy, a city nicknamed “La grassa” (the fat) for its delectable pasta, Fico Eataly World is a sprawling complex spanning 20 acres, featuring 40 production facilities that include a dairy plant, pork processor and a pasta manufacturer, 45 restaurants and 150 retailers offering premium local foods. Outside are four acres of grazing pastures, bee hives as well as a craft brewery.

The institution also serves as an education centre, allowing visitors to learn about local food history and production through tasting events and demonstrations.

According to Euromonitor, consumers want to experience more in shopping outings, and hunger for a better understanding where their food comes from. According to the site, “FICO was born out of a passion for the heritage of Italian agri-food biodiversity.” The park touts itself as a one-stop shop for learning about Italian food culture, traditions and craftsmanship.

While it won’t have a theme park, Eataly will be opening its first Canadian location in Toronto’s Yorkville neighbourhood in 2019 and will span over 50,000 square-feet of retail space.

As a concept, Eataly is in growth mode, says TracyLocke’s Jason Dubroy. And locally, he says the closest Toronto has to a “great hall market experience” with small food stalls is St Lawrence Market.

According to Dubroy, the new Eataly concept stores are blurring the line between restaurant and grocery while the launch of the giant Bologna, Italy theme park locale “was to test the limits of what a concept can do.” However, Dubroy says, all Eataly locations are now tourist destinations in their own right. He says the new Toronto location will benefit from novelty and location, as Yorkville is becoming a hub for high-end grocery, with Whole Foods, celebrity chef Mark McEwan’s eponymous location, and soon Eataly.