Retailers need to put up clear guidelines for brands to follow. Brands need to follow the guidelines. We (CPG in totality) haven’t been good at either of these things.

If both retailer and brand could stay within guidelines, right now as a retailer,I’d be creating guidelines for brands to help me fill in my marketing strategy and allow them into stores to run these projects.

Retailers need experiential right now and brands are equipped to help with that. If I’m a brand and I want to show that I’m worthy, I’d bring more than my brand to the table — I’d go out and find partners to bring a multi-brand experience to help the consumer stay longer in-store.

Many grocery retailers in the U.S. are a long way behind on technology, and some are even backward on the basics of the store experience.

That said, U.S. CPG companies are not all that great either. While giants like Pepsi are progressive, some do not seem to have moved out of the 1970s on basic things like packaging design and marketing. It’s one of the reasons niche and innovative CPG firms are enjoying their success.

There is much work to do on both sides!

The question of who owns the real estate has long been decided in the retailer’s favor. Now the question is “who owns the air and space in store?” I think the answer is the same — the retailer — and CPG companies would be wise to partner versus try to bring something in store without notice. Retailers must have their own agenda for technology that can benefit the shopper but, where the interests align, should partner with CPG.

Retailers should welcome and embrace any brand that is willing to experiment, test and fund new technologies to reach their target customers in a sea of digitally-empowered shoppers that have an ever-increasing vista of expectations. Retailers that insist on “owning” the shopper will continue to be marginalized. The funding for any, and all, of these in-store initiatives will ALWAYS be carried, directly or indirectly, on the backs of the CPG brands — and they know it! Retailers: the status-quo is dying! It’s time to shift your perspective and question, if not bust, every paradigm to delight your shoppers.

RSR has seen in our data that grocers are far more open to upping their technology game than they’ve been in the past. But I don’t think they should facilitate brands’ projects … rather they should buy solutions that are applicable to both private label and branded product.

If brands want to bring their own technologies into stores, I don’t think I’d refuse, but I also would be very careful to maintain independence. It’s all about leverage.

Retailers know their market, their budgets and their goals. CPG brands are not aware (and often they don’t even care) about these things, despite its importance to a retailer. Retail still depends on the basics (anticipating product velocity, eliminating out-of-stocks, product positioning, proper pricing, marketing, etc.) and this is the lifeblood of most retailers — and it should be.

Although it may seem like a chicken-and-egg conversation, it is in the best interest of both retailers and CPG brands to work together to meet consumer expectations. Simply put shoppers are not only expecting connectivity, interactivity and an experiential engagement at shelf, but they are DEMANDING it!

Hershey’s acknowledgement that the conversation has shifted from one of shelf placement/category management to technology and operational dialogues is precisely what should be happening. To remain relevant and current, retailers must reinvent their traditional thinking and CPG brands need to support technology investments, access and utilization. We are definitely living in a brave new world.

What do customers expect from retailers? What do they do if a retailer does not live up to their expectations? If customers switch their loyalty based upon technology availability, retailers have to change or risk going out of business. The new atmosphere requires cross-functional collaboration by both retailers and manufacturers because the solutions involve more than one function. This situation is just another example of what has been required in the marketplace for years and the difficult position of those companies that think this change (use of technology and collaboration) is not necessary.

As the use of technology increases for buying online, using mobile applications and the use of beacons increases, brands will put pressure on retailers to use these technologies to attract consumers to their brands and increase customer support and satisfaction. Retailers will need to increase spending on technology to keep pace with their competitors, their customers and their brands.

The more important a brand is to the retailer’s sales, the more investment retailers will need to make to meet the expectations of the brand. CPG companies can demonstrate their worth for the investment by partnering with the retailers, setting proper goals where the retailer and the brand both succeed and measuring how well the goals were achieved. One of those goals will likely be increased sales of the brand, the ultimate measure of success.

The physical store is a platform, just as the web is a platform. Creating the infrastructure to support electric, wireless, etc. gives the retailer flexibility to test and engage with a variety of solutions to see what works. Aligning with brand partners takes that to the next level as their budgets and access to technologies are typically greater than the retailer alone.

Each month grocers are bombarded with more than a dozen tech innovations that would be “perfect” enhancements for their in-store experience. Many don’t have the time to evaluate all of them, and many don’t have the resources to deploy them.

Enter the CPG manufacturer as a potential partner for tech innovation. The smart retailer will embrace the relationship and figure out who is the alpha dog later on.
If grocers don’t partner for technology, their key competitors will.