During the open day of Groceryshop 2023 key topics centered around AI, data and how consumer behavior has disrupted the grocery industry. Before the pandemic, less than 3% of sales in this sector were digital. After three years of record growth, digital grocery sales have reached 12%. McKinsey projects almost 200% growth by 2025, with grocery reaching 35% of all retail sales. Some categories, like pet products, are projected to have 46% penetration.
Even with almost three times the average growth, Grocery is still primed for digital evolution and disruption. With so much rapid growth in the industry, there’s no longer a playbook nor one-size-fits-all approach to the space.
There’s no better conference to see how diverse this growing space is than Groceryshop. Taking place in Las Vegas, Nevada this week, Groceryshop is the largest event for innovation in grocery and CPG. This year, there are 400 sponsors and exhibitors, and an estimated 4,000 attendees from both established and startup CPG brands to grocery retailers to technology partners.
In one of the fireside chats, Optimizing Your Ecommerce Sales Channel Mix, Jason Goldberg, Chief Commerce Strategy Officer, Publicis Groupe sat down with Raquel Navarrski, Customer Vice President, eCommerce Pure Play, General Mills to discuss everything from partnerships with Amazon to attribution challenges and discovering “what’s next” to what the leader of the future looks like.
“Our old playbooks don’t work,” said Goldberg in his opening monologue.
The digital grocery space is diverse, with three different segments - online pickup, home delivery, and central warehouse shipments. Each of these segments requires a unique marketing strategy.
For example, online pickup is dominated by omnichannel retailers like Walmart and Kroger, while home delivery is driven by digitally native grocers like Amazon, DoorDash, and Instacart. These different channels mandate tailored marketing approaches.
Additionally, “there’s little product overlap,” shared Goldberg. Perishable items, such as fresh produce, are more likely to be purchased from Walmart, while customers turn to Amazon for shelf-stable products. Marketers must consider these nuances when allocating their budgets and resources.
Coincidentally, Instacart announced their public offering today and DoorDash recently shared they now have 100,000 non-restaurant stores across North America, further highlighting the importance and growth potential of the digital grocery space. The rapid development of the space has challenged marketers to rethink their playbooks and create fresh advertising approaches.
One fresh approach is through authentic brand collaborations. A partnership Navarrski is particularly proud of is with Amazon for Thursday Night Football. General Mills’ brands will show up in fun, authentic ways throughout the games like a “Cina Emoji” from Cinnamon Toast Crunch that will appear in unexpected moments and tackling game day meals with Old El Paso’s "So. Many. Pasobilities” ad series. According to Navarrski the partnership is an opportunity to test innovative advertising approaches and gather valuable insights. Being able to test, at scale, with a national and credible media network like Amazon will help to inform the mix more broadly between national and retail media as well as other partners emerging in this space.
While “new” and “next” are important, Navarrski emphasized the importance of aligning any effort with the brand strategy. “We are in service to our brands,” she said.
Goldberg asked how Navarrski and team choose where to focus next. Navarrski shared that while the team develops annual trend frameworks and big bets, they also stay agile to take advantage of changing trends and emerging opportunities. “In a rapidly evolving digital landscape, staying curious, humble, and open to learning is essential for success,” said Navarrski.
While ideas that align with both the brand and customer drive the funding, Navarrski also keeps the team and leaders excited by bringing in key stakeholders early and often. “If you want to get buy-in for your big idea, you need to get your marketing team excited,” said Navarrski. “You have to bring them along in the journey so that you are not the only one championing those ideas, but you have other voices in there helping to champion them for you.”
The role of data in this ecosystem is also crucial. Retail media must work on standardizing data measurement and attribution across various channels to allow marketers to make informed decisions and optimize their marketing efforts effectively. Initiatives like the IAB's efforts in retail media measurement are instrumental in these discussions.
Lastly, a theme across panels was around building teams and talent. Navarrski shared that she envisions a future where leaders are focused on making silos disappear. Leaders of the future are “connectors of dots” that can translate business objectives across all teams.
While there’s no one-size-fits-all framework for digital grocery marketing, creating spaces for agile innovation and teams with a curious, humble, learning mindset will be the key to future success.
Posted at MediaVillage through the Thought Leadership self-publishing platform.
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