Can Hershey help grocers transition to a digitally-dominated future?

Dale Buss Through a special arrangement, presented here for discussion is a summary of a current article from the monthly e-zine, CPGmatters. In an unusual initiative for a CPG brand, Hershey just released a report, “New Retail in a Shopper’s World,” that details how retailers can transition to a digitally-dominated future. Hershey, other candy brands and some other snack brands remain heavily dependent on physical retail space. Brian Kavanagh, senior director of retail evolution for Hershey, told CPGmatters, “That’s because we’re often not on consumers’ shopping lists. So we need those grocers’ doors to stay open.” Candy also tends to be more “variety-driven” than categories. In fact, Mr. Kavanagh added, in the candy aisle much more so than many others, “If consumers aren’t walking up and down it and engaging some of our fun packaging and branding, they might miss it.” In its report, Hershey urges stores to take advantage of the attractions of physical retailing, such as instant gratification and sensory immediacy. The smartest retailers are taking a “longer view” by cultivating relationships with their shoppers and building experiences “based on what makes the fans tick. Their stores reflect people’s desire to socialize, discover and share. And they’ve seamlessly integrated technology into the experience.” At its Global Innovation Center at headquarters in Hershey, PA, the company also has established Medley, a highly social, “personalized” concept of a future store built not around merchandise but around experiences such as sampling, parties and virtual reality. The store is staffed by experts who can help with product selection and meal planning and features a demonstration kitchen. “When retailers visit, we take them there, just to stimulate them to think differently,” Mr. Kavanagh said. “Not just for confection or any particular category, but to say that we haven’t changed anything materially about the grocery-shopping experience in 50 years.” Even initially skeptical retailers have become more open to the ideas in Medley and the sort of thinking demonstrated by Hershey’s new report. “The conversation has changed just in the last six months, with the vast retail disruption that’s changed the marketplace,” Mr. Kavanagh said. “Now it’s become a matter of which retailers want to act fast and make material changes to the shopper’s experience.”

• Hershey recommends creative changes for grocery stores – CPGmatters