As part of their ongoing mission to help clients stay ahead of the competition in a fast-paced, constantly evolving marketplace, Mars UnitedSM Commerce’s Customer Development team closely monitors the strategic activity taking place across all key retailers and channels.
Each month, the teams compile Marketplace Assessment reports on the retailers (including Walmart, Target, Amazon, and Kroger) and channels (such as Regional Grocery, C-Store, Club, Pet, Beauty, and On-Demand Delivery) that are most important to the business success of our clients. The following report outlines noteworthy events across six key retailers from the team’s most recent round of assessments. (To receive copies of the full reports, contact EVP-Customer Development Kandi Arrington at [email protected].)
____________
Walmart Streamlines Rx Fulfillment Options
Walmart has modified its delivery offerings by combining prescription medication and general merchandise ordering into one streamlined process. (Prescriptions previously had to be ordered and fulfilled in a separate transaction.) Initially available in six states, Walmart expects to roll out the service to 49 states by the end of January 2025.
Shoppers now will be able to choose from multiple delivery options including same-day scheduled, on-demand, and express. That last option promises delivery as quickly as 30 minutes. The service is free to members of the Walmart+ program, with non-members charged the standard $9.95 delivery fee.
Relevance: Walmart continues to position itself as a major player in healthcare and therefore needs to compete against Amazon, CVS, and Walgreens in offering same-day prescription services. This new capability is launching as both Walgreens and CVS have announced pharmacy closures, offering shoppers alternative convenience.
____________
Target Wins with Good & Gather
Target’s Good & Gather private label celebrated its 5th anniversary this fall as a $4 billion brand, a positive reflection of the retailer’s ongoing efforts to build the food and beverage business in recent years. The retailer launched the brand in September 2019 to appeal to shoppers seeking more affordable food options. Expansion since then has included dedicated sub-brands Good & Gather Baby and Good & Gather Toddler.
Relevance: More than 40% of all Target grocery receipts now include at least one Good & Gather item, according to the company. Additionally, over half of the roughly 2,500 Good & Gather items are priced under $5 — an attractive price for shoppers looking to save.
____________
Albertsons Launches Forecasting Tool
To streamline processing at its distribution centers, Albertsons Companies is adopting a new forecasting tool from tech company Afresh Technologies. The AI-powered Afresh DC Forecasts tool is a fresh foods-specific solution for buyers that’s designed to improve forecasting, ordering, and inventory management. The tool automatically compiles relevant purchase data and considers a wide range of critical demand drivers like promotions, store displays, seasonal trends, and holidays.
By synthesizing multiple data sources and automating the traditionally manual process of forecast calculation, the tool is expected to save time for buyers and deliver item-level daily forecasts. Albertsons plans to implement the solution across produce, meat, seafood, deli, and foodservice at 17 of its 22 DCs across the U.S.
Relevance: The expected time savings should give Albertsons buyers more time for strategic tasks like inventory assessment and long-term planning. The tool is also expected to drive efficiency through the supply chain, from source to shopper, reducing waste while improving product quality and extending shelf life.
____________
Kroger Bets on RFID
Kroger will utilize radio frequency identification (RFID) technology from tech company Avery Dennison to provide store employees with more frequent and accurate inventory information. RFID systems utilize radio waves to track products using on-pack tags that wirelessly communicate with readers without the need for line-of-sight connections.
The retailer will first bring RFID tags to the bakery department to accelerate inventory counts and automate freshness evaluation in categories that are particularly perishable. By providing up-to-date and accurate inventory information, the RFID tech will ensure that shelves are stocked with fresh products, streamlining a process that has always been highly manual.
Relevance: The RFID capability will help prevent food waste by minimizing the loss of sales due to expiration. It will also expedite the product recall process by making it easier to find and remove affected items from shelves. More accurate inventory counts will also help suppliers better understand how quickly products are moving at each retail location.
____________
Sam’s Club Goes All-Digital
Nearly two years after a tornado destroyed the location, Sam’s Club has reopened a store in Grapevine, Texas, as a testing ground for its all-digital operational concept. Shoppers at the club will only be able to check out using the retailer’s Scan & Go app on their smartphones. The erstwhile checkout area has been updated to display online-only products, like Christmas trees or living room furniture.
Introduced in 2018, Scan & Go is now available for use in all Sam’s Club locations. The app lets members scan items as they walk the store and complete payment without waiting in a checkout line. Over the past three years, adoption has increased 50%, driven largely by Gen Z and other younger members.
Sam’s Club is implementing AI-powered technology to streamline the checkout process even further. Approximately 120 clubs now have technology that uses computer vision and artificial intelligence to scan carts as shoppers exit the store (regardless of how they’ve paid), which addresses the oft-noted frustration of having to wait for an employee to verify receipts.
Relevance: Sam’s Club’s tech-driven concept is enhancing shopper convenience and efficiency. For brands, it signals the need to embrace digital engagement as a major component of the in-store shopping experience.
____________
Costco Leans into ‘Scan to Enter’
Costco continues to roll out technology at club entrances that require members to first scan their physical or digital membership card before showing their card and photo ID to an employee. The goal is to eliminate the practice of membership sharing or the common occurrence of expired members being turned away at checkout (which then requires cartloads of products to be restocked). The retailer believes the process will also improve the shopping experience by ending the need for members to present their cards anywhere else during the trip.
Relevance: Though initial feedback about the procedure has been mixed, a rise in memberships at locations that already use the technology suggests that the strategy is having the desired effect for Costco.
____________
Opportunities for Brands
Brands should continuously assess announcements and new initiatives at key retailers to find ideas for potential partnerships:
- Walmart’s new prescription delivery bundling could give brands with over-the-counter heath & wellness-related products (cough drops, tissues, soup, etc.) opportunities to position themselves as essential add-ons.
- Good & Gather’s popularity — and basket frequency — should have brands exploring ways to bundle their products with relevant private-label items to deliver easy solutions for shoppers while driving product discovery.
Meanwhile, new technologies that improve store-level inventory management spotlight the growing need for brands to go back to the basics of the customer experience. They should work with retailer partners to find ways of using these technologies to better understand shopper behavior and help improve the shopper journey.
Similarly, brands should look to new tech capabilities like “Scan & Go” at Sam’s Club and scan to enter at Costco to leverage the shopper understanding and personalized engagement opportunities they might provide. They should also investigate digital initiatives that could deliver targeted offers that will resonate with club members while in the store.
____________
Mars United Commerce’s Customer Development practice is an unrivaled team of in-market commerce experts who simplify the complexity of retail for our clients. Located in Bentonville, Minneapolis, Cincinnati, Chicago, Tampa and the “backyards” of other key retailers, they provide deep knowledge of the retailer, expertise in key business areas (like strategy, media and creative), and door-opening personal relationships with key executives to deliver an unmatched level of business success for clients across accounts, channels, and shopper engagement platforms. For more information, contact EVP-Customer Development Kandi Arrington at [email protected].
