I’ve done some IT strategy work for the retail groceries in the past, so I’ve been obsessed by all these articles out in the last couple days about a new smart cart that Whole Foods is piloting. I’m excited as a customer and intrigued as an IT strategist. And I’d pay to be a fly on the wall in the meetings at Whole Foods’ headquarters where they are discussing the “business case” for this investment.
Here’s a link with an overview of what they are up to, but the short of it is that they are piloting some in-cart technology that will track your grocery list, locate items in the store, tell you when you picked the wrong item, check you out without having to go through a line and even follow you around the store. Fun! But what’s the play?
I’ll get back to that. First, a story to let you know where I’m coming from here. A few years ago, I was helping a mid-sized grocery store with their IT strategy. As part of that effort, I presented some investment ideas to the CFO and the executive team. The CFO was completely locked into getting their IT spend below 1.5% of revenue (which he argued was the appropriate retail grocery benchmark, even though it is significantly below other industry averages). Benchmarks aside, I thought there were some really interesting plays for them with technology, but he was insistent that all capital spending needed to go towards opening more stores – that’s where they’d make their money. It was a fair argument.
So back to this cart. I can’t help but think about all the possibilities… What if I could email or text my account with items to add to my shopping list throughout the week? What if I could see an item on special while in the store and immediate look up recipes with user feedback … and then automatically add ingredients to my list? What if I could enter something general on my list like “appetizer” or “desert” and the cart could suggest items on special, based on my pre-set preferences of things I like (avocado, things on sale) and don’t (gluten)? Meanwhile, what if I could see my running grocery bill so I don’t blow my life savings through this process?
I’m actually getting excited about grocery shopping again. At Whole Foods! I used to shop there all the time. Then I got married. To a financial planner. And I feed the two of us, a kid and a nanny. I now shop at several stores, clip coupons and wash my own lettuce. The wonderful Whole Foods $40 pre-made meals for two are a relic of my past. But I still do miss it… and this technology could get me back there.
If others are like me, I can’t help but think about all the benefits for Whole Foods of a technology like this:
- They’d attract me and others back to the store, driving up total customers and overall revenues
- Using intelligent suggestion, they’d increase my overall purchase price beyond what I’d planned to buy
- They’d have tons of valuable information about me through my loyalty card – and I’d be willing to share much more with them than other places for the customization of the experience
- They’d retain me as a customer, locking in more and more of my grocery store spend, especially if I could track my grocery bill as I go
- They could promote certain products to certain customers to unload extra inventory
I’m eager to watch this one unfold. If nothing else, the novelty will get me back in a Whole Foods soon!