Disruption Alert: Walmart patents a storeless retail system
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One of Walmart's recent patents suggests a real surprise – a vision for seamless and efficient grocery retailing that removes the store from the value chain. In this scenario, the products that consumers are expected to buy would be delivered directly to their home. It’s a futuristic vision, but not entirely unrealistic, and it shows how new thinking plus digital can radically change almost everything about the grocery world we know today.
The patent describes a world in
which there would be no store or even typical grocery
delivery (at least for some consumers). Instead, the store would become a part of the consumer’s home.
The specific products a household is expected to buy would ship to the home and stay there until the consumer was ready to purchase them – or they would be pushed to the consumer
automatically based on usage rates. Either way, the prepositioned merchandise is owned by the
retailer/distributor until the consumer takes possession.
Imagine: Products would skip the trip from storeroom to shelf to checkout to car. And consumers would skip the trip to the store and the parking lot hassles, or the chore of ordering and arranging a delivery/pickup window.
This streamlined value chain creates some important efficiencies for retailers.
- Ordering can be automated, based on usage rates and seasonal needs.
- Deliveries can be scheduled when the system decides it’s most efficient and/or necessary to replenish.
- The receiving function is virtually eliminated.
- Sales promotions are done with a complete understanding of the household’s needs and purchase patterns.
The consumer benefits would include:
- Greatly minimizing or eliminating the time and effort involved in grocery shopping, plus the energy-saving environmental benefits of less driving.
- Receiving personalized recommendations and guidance on nutrition, diet, and lifestyle.
- Reducing the need to deal with the shipping boxes and materials associated with most of today’s home delivery methods.
- The possibility of dramatically reducing the amount of product stored in each home because purchases can be accurately predicted to meet usage rates, virtually eliminating the need for “stock up” trips.
The system isn’t cheap, but the significant incremental costs associated with installing this capability could be minimized by installing the capability when homes are built, and by combining these capabilities with existing home appliances like the smart refrigerator.
BMC POV
This is just one of Walmart’s new patents, and it challenges almost everything in the traditional value chain. It also begs the question:
How can other retailers and branded product manufacturers respond?
Given that it’s hard to stop the technology-driven change that’s accelerating every year, the best response for other grocery retailers and CPGs is to make the experience with the current value chain better. This means:
- Reducing or eliminating what customers see as the major negatives of dealing with the store, such as checkout lines, out of stocks, and the time and hassle involved in navigating a large store.
- Adding improvements that make it easier to prepare meals, personalize promotions, and bring more fun and excitement to the store.
- Pushing into new product areas that expand the retailer’s market and create incremental sales and bottom line profits such as health services and on trend apparel.
Image & info source: Forget Online Shopping. Walmart Patents A Store Built Right In Your Home. - CBInsights.com
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Brick Meets Click was founded in 2011 out of the desire to help the food retailing industry that we know so well meet the challenge of new competitors and navigate the profound changes resulting from this disruption. Contact us today to learn more on how we can help you.
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