SAP Retail Forum: Target, Loblaw keep up with changing customer needs

Two leading retailers highlighted different aspects of their digital customer experience efforts at the recent SAP Retail Forum in Miami.



Keri Stelle, director, Target Technology Services, said Target Corp. is trying to modify its entire corporate culture to respond to changing needs of the new digital customer in a session titled, “Who is the Evolving Target Guest?”



“It’s not just about Mom anymore,” said Stelle. “Today, the entire family wields influence over the retail purchase.”



Target calls its new breed of consumer “demanding enthusiasts.” Large portions of Target’s new customer base are Hispanic, millennial, urban and digitally connected.



“They want an emotional connection,” said Stelle. “You need to connect the channels. Demanding enthusiasts can shop anywhere, anytime and find the product. These are table stakes. If you can’t do it, you’re behind.”



As an example of the new digitally enabled customer experience, Stelle said her teen daughter uses a social platform called Polyvore that lets her compose outfits from multiple retailers and share them with her friends.



“She serves as her own merchant by mashing up outfits,” said Stelle.



To ensure it can adequately meet the needs of demanding enthusiasts, Target formed an internal guest center of excellence earlier this year. The center’s team focuses and trains on what needs to be done to stay current with customer experience.



“You need to break down internal silos,” said Stelle. “You need to realign internal teams around channels, not internal functions.”



Target is also seeing hoped-for results from its buy-online-pickup-in-store program, and is piloting ship-from-store at 150 of its roughly 1,800 stores across the U.S. The retailer plans to expand the pilot to 450 stores by end of year.



“We have 36 big distribution centers, but could have 1,800 distribution centers,” Stelle said. “You can ship product a lot faster leveraging 1,800 stores.” [pb]



Raif Barbaros, VP of technology, Loblaw Digital, explained how the Canadian food and drug retailer offers online click and collect shopping to its customers. Loblaw operates 2,300 stores across 22 banners in Canada.



“We launched click and collect in October 2014,” said Barbaros. “Customers order online, we do the shopping, then they collect their goods and enjoy.”



Using the Loblaw mobile app or website, customers select a store and a two-hour delivery window as much as two weeks in advance. They then scroll through products, with the ability to search by specific attribute such as “green bananas.” The same deals and offers available through any other channel are available through click and collect, and a tool called QuickShop lets shoppers see past purchases.



Personal shoppers then select goods and deliver them to the consumer’s car. Payment can be made in advance via credit or debit card or in person via cash.



Challenges include the lack of national Loblaw pricing, meaning there must be a customized shopping list for each store. Customers receive an estimated advance price for loose items that are priced by weight. There are also some challenges inherent to the grocery experience.



“Grocery is not the most inspirational shopping task,” commented Barbaros. “Ninety-five percent of grocery purchases are replenishment items.”



To make the often dull process of replacing grocery items more palatable, Loblaw uses algorithms to highlight the items that customers most likely need. A “select all” option lets them quickly add staples to their online list.



“We’re using the store like a warehouse,” commented Barbaros. “There are location tags on the shelves.”