Stop & Shop & Scan: Grocery Retailer Gets Mobile Proactive

by Net Future Institute on October 9, 2012

It’s understandable that a consumer might use in-store mobile barcode scanning to save money on a big-ticket item.

The customer can scan an item, quickly see the price of the same product from surrounding stores, and give the retailer the chance to price-match or purchase the item elsewhere or online. The potential savings on large purchases can make the effort worthwhile.

But will consumers also put in the scanning effort for much smaller and less expensive items, such as groceries?

Ahold USA, parent company of Stop & Shop and other supermarkets, has been working on just that issue since about 2001.

After various iterations, Ahold installed handheld scanners in several hundred of its 750 stores throughout the U.S. A shopper entering a Stop & Shop could pick up a scanner at the store entrance, scan products as they shop and return the scanner on the way out.

The benefit was the offering of coupons based on items scanned, integration of coupons with the shopping, real-time tracking of the total cost of what was scanned and a running tally of the total savings based on the coupons redeemed. These were pre-smartphone days.

At the time, I had serious reservations about the success of such a system — where consumers would have to learn to use a foreign device only while they were in the store — and whether they might feel somewhat strange walking around a supermarket scanning every item they wanted to buy. However, many shoppers did use the devices, which turned out to be a success over time.

Stop & Shop is now moving that capability to smartphones, transforming and simplifying the process. To see how this works, I went grocery shopping with an executive of Catalina Mobile, the company that has been working on in-store scanning with Ahold and Stop & Shop for the past decade and the one that developed the mobile app.

I was still a bit skeptical of how and whether this would even work, until I visited the store. We entered a Stop & Shop in Danvers, MA, and charted our course around the store.

Before even starting our mobile shopping, I watched a woman with two small children in her shopping cart (one with a car and steering wheel in front) pick up and scan items, put them in a bag in her cart and move on to the next aisle. She did this throughout the store, looking as if she had been doing it all her life. No big deal.

At checkout, the shopper uses the scanner to quickly check out and pay, with the groceries not having to be removed from the bags (there are various security profiling measures built into the system).

The iPhone and Android apps were launched in more than 250 stores earlier this year, and we used the iPhone version for our shopping.

Products of various categories were read relatively easily with the app and as we scanned certain items, we received instant coupon offers. “We bring big data down to the aisle,” said John Caron, vice president, marketing, at Catalina Mobile and my shopping companion.

When we scanned items in the dairy section, we received coupon offers for items in the same section. The selection was based not only on location, but on past purchase patterns and other criteria, said Caron, which was true of all products scanned.

In the produce department, there are scales where shoppers typically weigh produce, except these now have instant printers that spit out a barcode to be read by the app, thereby automatically entering the item into the shopping cart.

The obvious long-term solution is to cut down on the number of registers and check out using in-the-aisle checkout by the shopper.

“Within three years, all grocers will have some integrated mobile savings, coupon and mobile commerce capability,” said Caron. “If you look at the top 25 (grocers), they’ll all have it in the next three years. The best ones will have it within the next 12 months. What you’ll see over the next 12 to 24 months is the majority of them embracing mobile as an engagement tool for their shoppers. I mean, can you think of anything more personal?”

We’ll see how well in-store scanning will evolve over time. But as shoppers with full shopping carts waited in line for their turn at the Stop & Shop checkout registers, the woman with the two small children was on her way to her car, groceries scanned, packed and paid.

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