BARRINGON, IL — Consumers have been shifting toward digital shopping platforms for years, but pandemic lockdowns put this trend into hyperdrive, leaving retailers and the commercial bakers that supply them to wonder: For how long?
Even as data suggests that the increase in online and click-and-collect grocery shopping has staying power post-pandemic (according to a Nielsen survey, the number of shoppers who considered themselves exclusive or heavy online shoppers for everyday items increased by 133% from September 2019 to September 2020), it is unlikely grocery would ever lean fully into an online-only model, according to Bill Bishop, chief architect and co-founder, Brick Meets Click. “Consumers don’t want to let someone else pick out their fresh items such as fruits and vegetables, meat, seafood and deli products for them.”
That is why many retailers are increasingly considering hybrid facilities: part fulfillment center for packing non-perishables like canned goods, and part in-person retail space where consumers can hand-select fresh products including produce and bakery. The fulfillment centers would rely heavily on automation such as robots in a back room, picking product like boxes of Cheerios and a bag of sugar, while the front of the store would be a more sensory experience, touting avocados, donuts and fresh flowers.
“I see a lot of opportunity for both in-store and commercial bakery as the traditional grocery store model evolves,” Bishop said.
“I see a lot of opportunity for both in-store and commercial bakery as the traditional grocery store model evolves,” Bishop said. He suggested that experiential factors could have a significant impact on driving people to visit in person and make impulse bakery purchases, whether it’s smelling fresh-baked cookies or connecting with the person behind the counter. “A lot of other bakery products, both on the commercial rack and from the instore bakery, are typically bought on the basis of appearance. But there’s a discovery aspect to shopping in person that consumers continue to crave, and retailers have an opportunity to educate and help them find something new.”
Technological advancements can also give commercial bakery brands new communication and marketing streams to partner with retailers and connect with customers more effectively, according to Gary Hawkins, founder and CEO of the Center for Advancing Retail & Technology. “Let’s say in the in-store bakery they’ve just had a batch of fresh baked bread come out of the oven, or cookies, or whatever,” he said. “The retailer can message every shopper within a mile of that store about a new batch of product. It’s really marketing in real time.”
And technologies like augmented and virtual reality offer new avenues for engagement with consumers as well. Products can now “come alive” via video to tell the story behind the product or offer recipe ideas for a particular ingredient. In a culture that values transparency and authenticity, this could be a valuable avenue for investment.
But the main takeaway is that consumer behaviors are changing faster than ever, and the time to act is now. “Things that people thought were going to be years off may now happen in months,” Hawkins said. “I would encourage everyone to really be aggressive in looking at new ways to communicate with shoppers and new ways to work with your retailers around marketing, messaging and all these types of things.”