Online grocery - Latest Trends

2. Current Scenario
in APAC
Percentage of shoppers who are using
social media site to make their purchase
decisions
63%
37%
Use Don’t Use
Percentage of total research time spend
on connected devices for each grocery
shopping activity
Category wise market share in overall
online grocery in 2012
53%
24%
13%
10%
< 25% 26% - 50% 51% - 75% > 75%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Conduct Research Online
Purchase a Product
Comapre Prices
Look for Deals
Read the Retailer's News
Provide Feedback
Percentage of shoppers who engage in different activities during
household grocery shopping
43%
21%
16%
4%
17%
Food Beverages
Personal Care Household Care
Others
Percentage increase in the online grocery spending over the last
five years on a per capita basis ($)
0% 5% 10% 15% 20% 25%
Middle East
America
Asia Pacific
Europe
Strategic Options
for Priceless
Customer
Management
Optimizing
Operations
Future
Roadmap

3. DriversforOnlineSuperstoresinSingaporeCurrent Scenario
in APAC
Demographics Consolidated traditional retail market
 Median age of a Singaporean is just 33 years suggesting
that most of the population would be familiar with
internet and its usage
 Unemployment rate is under 2% indicating the rise of
‘Cash Rich Time Poor’ population
 40% of the residents in Singapore are foreigners who
create a huge demand for different products from foreign
countries
 High purchasing power and low availability of leisure
time encourage the trend of easy and convenient
shopping at online groceries stores
 Two largest players, NTUC Fairprice cooperative and
Dairy Farm International Holding, alone capture above
50% of traditional grocery outlets
 Very few hard discounters and hence less price
competition
 Create an opportunity for online grocery retail to exploit
the economies of scale and pass on the discount to
consumers
 Provide a chance to store varied products to cater the
need of a large customer base
 Reduces the cost of expanding into new territories and
acquiring new customers
 More than half of the population use social networking
sites like Facebook
 Mobile penetration is extremely high at around 150%,
most of them prefer smartphones
 With such a high connectivity, it is easier to extract
customers insights and determine products and services
future
 Social connectivity increases marketing efforts as it
helps in customizing the advertisements as per the target
preferences
 Most of the shoppers look for reviews and
recommendations before buying a product
 Broadband penetration is more than 100%, providing
hi-speed service plans upto 1Gbit/s
 Majority of the population lives in large metros/cities
which makes it easier to deliver online groceries in an
efficient manner
 Due to lack of space, most of the cities have just one or
two traditional stores, which creates a dire need for online
grocery
 Strong infrastructure helps in creating a robust
operation model throughout the system
Very high level of Social Connectivity Strong Infrastructure
Current Scenario
in APAC
Strategic Options
for Priceless
Customer
Management
Optimizing
Operations
Future
Roadmap

4. Current Scenario
in APAC
CompetitiveAnalysisoftoptwoplayersinSingapore
Fairprice
Cheers
7-
Eleven
Cold
Storage
Shop
N
Save
Giant
Value for Money Pricing Premium Pricing
LimitedRangeExtensiveRange
Windows for
Opportunity
Priceless
Dairy Farm International Holding
Opportunity 1 Opportunity 2 Opportunity 3
Expand Product Range
 As evident from above fig., Priceless
is currently having a limited range of
products in supermarkets. With
increase in the varied demand from the
consumers, its high time that Priceless
starts moving up in the 2nd quadrant
Expand into 1st Quadrant
 With the rise in ‘Cash Rich Time Poor
’ population, there is an opportunity to
launch stores with higher perceived
value for consumers. Outlet concepts
like the. Thai Street and Japanese
corner can help in this transformation
Prevent Current Market Share
 With more and more competition
coming in, it is imperative for Priceless
to tweak its business model to serve
customers in a better manner
Current Scenario
in APAC
Strategic Options
for Priceless
Customer
Management
Optimizing
Operations
Future
Roadmap

5. Current Scenario
in APAC
BenefitsandChallengesofOnlineGroceryStores
Infinite Product Offering Value for Money Shopping Convenient Shopping
 Online supermarkets can have a large
assortment of products catering to the
demand of much larger user base
These online stores will act as
demand aggregators, hence making it
economically viable to store less
frequently selling products
Delivery Services
 Lack of truly flexible and optimized
delivery system can undermine the
online ordering convenience
 Delivery charges (though can be
charged) undermine the potential
saving messages of online shopping. A
robust back-end infrastructure is a must
 Most of the online stores enjoy
economies of scale, which in turn is
transferred to end consumers through
discounts and deals
 The online stores also offer price
comparisons. Hence, each store tries to
provide the most competitive price
 The online stores will reduce the
overall time spend on the household
shopping
 With more and more customers
using their smartphones to access
internet, online store will provide an
on-the-go shopping experience
Sensory Factors
 Even most of the regular online
shoppers are not frequent grocery
shoppers. Inability to see/touch the real
product hampers the purchasing
decisions
 This trend is amplified in perishable
food items
Trust
 Chances of wrong product selection/
substitution decreases the credibility.
Customers don’t trust others’ choices
on their behalf
 Customers might be reluctant to
share their personal data before
making an grocery purchase
Benefits
Challenges
Current Scenario
in APAC
Strategic Options
for Priceless
Customer
Management
Optimizing
Operations
Future
Roadmap

6. BusinessModelforOnlineGroceryStoresinSingaporeCurrent Scenario
in APAC
Store to Home Click and Collect
Warehouse to Home Drive Through
Home Delivery Pickup
In-storePickingWarehousePicking
Advantages
Quick to adopt
 Can leverage your existing business
model
Disadvantages
 High Delivery Cost
 Unavailability of ordered product in
nearby stores
 Interfere with the daily operation of
supermarket
 Customer has to be present at the
time of delivery
Advantages
 Easiest to implement
 Can leverage your existing retail
network
Disadvantages
 Customer sees little difference in
offline and online channels, hence
unwilling to pay any premium
 Unavailability of ordered product in
nearby stores
Advantages
Benefits of scale economies
 Infinite number of product offering
Disadvantages
 High level of customer service
required can make it quite expensive
for grocers
Advantages
 Highly efficient pickup processes,
could take even less than 5 mins
 Economies of scale benefits
 Convenience to customers
Disadvantages
High level of customer service
required
Clearly, ‘Store to Home’ and ‘Click and
Collect’ model seems to be most
appropriate for Priceless to start its
journey in the online grocery retail
Current Scenario
in APAC
Strategic Options
for Priceless
Customer
Management
Optimizing
Operations
Future
Roadmap

7. Mobile, Social & PC
growth
Evolving consumer
behavior
Retailer’s Goal
Connect
Interaction
Gain
actionable
insight
Optimize
operations
Web Commerce
Customer
Relationship
Loyalty
management
Business
intelligence
Merchandise
planning
Pricing strategy
Inventory planning
& forecasting
Supply chain/cross
channel fulfillment
Merchandizing
Goal Action Points
BuildingBlockofOnlineSupermarket
Create a customer
experience Platform
Measure satisfaction across
touch points
Re-focus for measurable
results
Embrace advanced analytics
in the era of big data
Focus on cross-channel
capabilities
Optimize operations in real
time
Leverage one version of
truth
Gain visibility into product
availability
Improve the back-end to
perfect the front-end
Current Scenario
in APAC
Strategic Options
for Priceless
Customer
Management
Optimizing
Operations
Future
Roadmap

8. Organization’s Problem –
Unable to scale when needed
Experiences consumer do
not want
Unhappy consumer
Unpredictable
consumer
Traditional
Retailing
Missing big opportunities
NeedforAgilityto
Configure
Optimize
Scale
Experiences
Need for system to
retrieve most relevant
info in real time
Adaptive experience
Dynamic
merchandizing
Content
targeting
Product
intelligence
Experience
optimization
Happy user
Modern online
retailing Create a customer experience
Platform
Deliver targeted user-centric
experiences in a scalable way
Allow business users to guide and
influence customers without having to
predict their path, set up scenarios, or
engage IT
Integrate with technologies like Web
analytics , recommendations , and user
reviews to automatically drive elements of
the experience
Mix and match data-driven , dynamic
content and static content
Less no. of clicks to buy a product
Easy to register & avail promotional
offers
Engage More Convert More
ConnectInteractionGainActionableInsightOptimizeoperations
Web commerce
Measure satisfaction across touch
points
Collect and analyze customer data across
all channels
Measure customer satisfaction at all touch
points
Give customer ownership of channel
experience
Share up-to-date fulfillment, planning and
execution information across channels
Customer Relationship
BuildingBlockofOnlineSupermarketCurrent Scenario
in APAC
Strategic Options
for Priceless
Customer
Management
Optimizing
Operations
Future
Roadmap

9. Consumer orders
Recipe X basket
Customer Loyalty
Cost effective purchase
for consumer
Added to cart
Recipe
Recommendation
Loyal customer Repeat purchase
ConnectInteractionGainActionableInsightOptimizeoperations
Refocus for measurable
results
Improve customer profitability
by rewarding the "right"
customer behavior
Reduce costs by automating
loyalty management business
processes
Maximize the effectiveness of
customer interactions
Reduce expenses by having
members update information
online
Integrate loyalty programs with
complementary partner
programs
Develop consistent loyalty
program, where customers can
register, check loyalty balance,
redeem rewards and access
specials across channel
Employ personalization
recommendations i.e. recipe
ingredient recommendation,
monthly shopping
recommendation
Loyalty Management
All Ingredients of Recipe X
Ingredient Quantity
A 100gm
B 150gm
C 50gm
Monthly basket
Recommendation
Consumer makes a monthly
grocery purchase
Information
recorded in system
Item list
Item Quantity
A x
B y
C z
Last month’s
items are added
to basket
Updated items
are added to
basket
Very convenient, time saving and
addictive shopping
BuildingBlockofOnlineSupermarketCurrent Scenario
in APAC
Strategic Options
for Priceless
Customer
Management
Optimizing
Operations
Future
Roadmap

10. Merchandise
planning issue
No over-stock, solid
markdown strategy, solve
allocation issue
Structured data
Synchronization issue, data unstructured
Cut-throat competition in
retail
Tailored Solution Increased Revenue
ConnectInteractionGainActionableInsightOptimizeoperations
Embrace advanced analytics
in the era of big data
Allows retailers to determine
which items to promote to which
customers using which methods
Provides insight into how
products are selling across
various customer behavioral
attributes
Performs customer segment
analysis based on demographics,
customer value (recency,
frequency, monetary analysis),
lifetime/potential value,
behavior, and item importance.
Determines product affinities
by performing market basket
analysis
Delivering personalized,
tailored offerings to individual
customers can derive improved
revenue conversion
Business intelligence
ERPPOS CRM
Business Intelligence
Focus on cross-channel
capabilities
Connecting siloed source of
data and embed science and
analytics Delivers workflow and a
decision framework that allows
for what-if scenarios and
comparisons
Maximizes margins over the
item's entire lifecycle, not just
during the full-price selling
period
Enables retailers to monitor
performance of past and ongoing
markdown activities against
financial and operational goals
Provides visibility into below-
chain-level forecast
recommendations,
recommended new retails, and
gross margin costs of delayed
decisions
Merchandise planning
BuildingBlockofOnlineSupermarketCurrent Scenario
in APAC
Strategic Options
for Priceless
Customer
Management
Optimizing
Operations
Future
Roadmap

11. Accurate Demand Perfect service
ConnectInteractionGainActionableInsightOptimizeoperations
Better
Demand
forecasting
Optimize operations
in real time
Sell through of each
assortment improved,
resulting in better
margin and inventory
turn
More effective
quarterly transitions to
new assortments
Reduced in-store
capacity
Effective price ladders
No of markdowns
increased from monthly
to bi-weekly
Leverage one
version of truth
New planning
system-from pre-
seasonal analysis to
strategic assortment
analysis
Line plan and buying
plan moved to store
level rather than basing
the plans on the total
chain
Customer demand
forecast drives time-
phased inventory
replenishment
calculations
Gain visibility into
product availability
Direct to consumer
fulfillment
Agility driven by
simplicity , visibility and
velocity
Retailers gain visibility
into current and
projected orders,
inventory, and supply-
chain performance
Store inventory needs
are aggregated into
associated warehouse’s
replenishment plan
Improve the back-
end to perfect the
front-end
Split offers and ship
more effectively
Streamlining
merchandizing and
pricing
Manages key
foundation data:
hierarchies, suppliers,
locations, and items
Easily handles multiple
brands, countries,
and/or channels
Pricing strategy
Inventory planning &
forecasting
Supply chain/cross
channel fulfillment
Merchandizing
Accurate
Replenishment
planning
Inventory
Optimization
Low inventory
holding cost
Better service
level
Secure, reliable &
scalable
BuildingBlockofOnlineSupermarketCurrent Scenario
in APAC
Strategic Options
for Priceless
Customer
Management
Optimizing
Operations
Future
Roadmap

12. FutureRoadmapforPricelessCurrent Scenario
in APAC
Current Scenario
in APAC
Strategic Options
for Priceless
Customer
Management
Optimizing
Operations
Future
Roadmap
Basics
Features
Increasing
Traffic
Advanced
Features
Branding/
Community
 Convenient is the biggest
factor for which customers
opt for online grocery store
 This feature should be
considered in all the
aspects of online store
 Some of the must have
features should be:
Aesthetic design, security,
robust server, easy
payment processing,
service call centre, basic
survey
 Once basic features are
done, focus should shift
towards increasing the user
traffic to the store
 With the increase in
smartphone usage, it has
become necessary that the
online store is optimized
for the mobile version
 Several features like SEO,
shopping feeds, ads,
discounts, etc. can help in
this area
 Next Priceless should
consider about creating a
fruitful engagement with
the customers
 Such kind of engagement
will lead to customer
loyalty which in turn will
help in repeat purchase
 Features like: product
reviews,
stories/testimonials,
recommendations,
personalization, online
chat, etc will help in this
regards
 Finally company should
look towards creating a
Brand value for the online
store
 This can be achieved
through mobile widgets,
wikis, loyalty program,
product videos, etc
 Creating a brand will
help attracting new
customers at a lower cost
and retaining them
Currently, Priceless has just basic features in its online endeavour. Looking at the current market conditions, online
grocery retail is bound to increase in coming future. Best part all this problem is that there are tools available to
solve this issue. Several technology company like Oracle provide retail solution to handle these situations. All that
‘Priceless’ needs is to collaborate with a trusted consulting partner with a good track record, to help them
implementing those solutions