Retail TouchPoints: D'Agostino Offers Shoppers Automated Grocery Lists Via Ikan Scanning Technology
Through a special arrangement, what follows is an excerpt of a current article from the Retail TouchPoints website, presented here for discussion.
In an age of increasingly time-poor and Internet-savvy consumers, the Ikan grocery scanner is designed to do for grocery shopping what Netflix did for DVD rentals. Manhattan retailer D'Agostino Grocery introduced the device to its customers in early 2008.
The device is a small countertop device, reminiscent of a kitchen appliance, which enables consumers to scan the barcode of empty items via their wi-fi network to a digital shopping list, serving as a reminder of what items (typically staples) should be purchased during the next trip to the grocery store. Or, in some cases, consumers can arrange to have their groceries delivered via the digital shopping system and receive a brief follow-up communication from a grocer.
"We're finding that people want to save time," said Anderson Chung, spokesperson for D'Agostino Grocery. "For the most part, people do enjoy shopping for their groceries, but some chose to order it online - there's a huge convenience factor" with the Ikan scanner.
To introduce the new scanning technology to its customers, D'Agostino sent an e-mail blast informing shoppers of in-store product demonstrations. The company offered an introductory price of $100, discounted from the $399 suggested retail price.
Although designed to provide shopping convenience, the scanner also offers merchandising potential. "I would imagine the brands would be dying to get into the database of groceries each home scanner has (and refills) to cross over with other loyalty database information," said Laura Davis-Taylor, principal of Retail Technology Consulting. "It's a golden ticket for behavioral merchandising."
D'Agostino recognized that opportunity and implemented behavioral merchandising into the personal shopping feature of the scanner. Using customer intelligence and reviewing the items selected on consumers' shopping lists, the grocer is able to target offers for specific customers as an incentive to shop.
Still, some industry analysts question the potential for the scanner to have a positive impact on sales and brand marketing.
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"For the past several years we have seen a number of technology tools that were supposed to make it easier for people to shop for and buy groceries," said George Whalin, president of Retail Management Consulting. "Yet, only a very small percentage of shoppers use the various delivery services that have been launched."
Another analyst believes the timesaving feature may not draw consumers' interest as anticipated. "Yes, the device saves time, but mainstream grocery shoppers are willing to spend some extra time to save on their groceries," said Mark Lilien, consultant with the Retail Technology Group.
Finally, operational costs are a concern. "A lot of retailers lost their shorts with home delivery and may be loathe to jump in again without good reason," said Ms. Davis-Taylor.
Discussion Questions: What do you think of the rollout potential for the Ikan grocery scanner? Is there enough consumer demand for such a device? What are the hurdles to its greater adoption?