Kroger (NYSE: KR) is making major technology changes across its retail operation to address checkout and food spoilage, and to add a new data analytics program.
The supermarket chain and second largest U.S. retailer acquired assets from dunnhumbyUSA last month and established a consumer insights company called 84.51°.
Among the changes instituted by VP and CIO Chris Hjelm is a research and development function within the IT department targeted toward investigating new innovations. One such innovation is the locationing technology called Q-Vision that is intended to help Kroger ensure that enough cashiers are on hand at the front-end before any sudden influx of shoppers at checkout occurs.
Kroger will also implement digital shelf signage to help employees and customers more easily find what they are looking for, Hjelm said in an interview with Forbes, adding that he urges team members to think like customers would when shopping for groceries.
"Fundamentally, we dramatically improved service with very little to no incremental labor; just sheer productivity improvement," Hjelm said.
With technology similar to what the Internet of Things has made possible, Hjelm's team addressed food spoilage by designing sensors to alert store managers and maintenance personnel when the temperature in a refrigerated case varies from what it needs to be.
"So if there's a problem, we're catching it within minutes and they're able to repair these issues before there's an impact to the product," Hjelm said. "Think of it across 2,650 stores, with all the frozen cases. That's a big task to have our associates do that manually, and we're automating that task. At the time we invented that, there wasn't any technology that could do that."
Kroger is working on ways to help shoppers find the products they are looking for more quickly, so they can get out of the store faster, and Hjelm is working to identify ways to physically highlight products that customers might normally have difficulty finding in an aisle.
"Think of it as a digital shelf edge," Hjelm said. "The example I use is with customers who are gluten-free. If you're looking at nutrition bars, we could highlight on the shelf, in your color of choice, the products that are gluten-free. Say you had a particular bottle of wine on your list that you wanted to get. Finding it in the wine department isn't always easy, but wouldn't it be nice if it would just highlight for you the bottle of wine that you needed to grab. We think we can shave a fair bit of time off the average customer's shopping trip."
The retailer is also planning more ad targeting through its new 84.51° operation. "We're just scratching the surface of personalization," Hjelm said. "Customers give us a lot of data. They share a lot of data online and via social media. How can we use that data that they're willing to share in a way that we can create better services? If a customer is willing to tell me that they're gluten-free, why wouldn't I want to share with them gluten-free products, whether it's in a promotional advertisement or coupons to offer to them?"
And as Kroger continues to innovate, Hjelm is keeping his eye on future technology trends. "It's a fascinating time," he said. "There is so much going on. One that comes to mind is productivity. I think there will be a continued explosion of what we're going to do to leverage technology to drive productivity. Whether it's locationing technology, I think open-source is going to have a huge role in both speed and productivity, the globalization that's taking place, the amount of data."
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