Sainsbury’s is the number three supermarket brand in the UK but it is currently getting squeezed from all sides.
The problem is that Sainsbury’s is not the leader in any single category. It does not appeal to price sensitive consumers at the “low end” of the market like Tesco, ASDA and Lidl. It also doesn’t appeal to “higher end” which is dominated by Waitrose and Marks and Spencer. It occupies the “muddy middle” with nothing to offer any one in particular.
Furthermore, it consistently follows the market. Its convenience stores (Sainsbury’s Local) was late to the market and despite it’s current success, missed out on prime real estate opportunities that were snapped up by Tesco. It is also trying to follow Tesco with non-grocery products such as its Tu line of clothing which has recently expanded its online presence with some success.
I believe that Sainsbury’s could be far more effective by reinventing itself as the most technically advanced supermarket in the UK – a far cry from where it is today with no apparent mobile strategy, underutilised personalisation from leveraging loyalty card data, and shops (especially convenience stores) with outdated payment technology.
Here’s how I think they could achieve this.
Sainsbury’s currently has no mobile strategy and that needs to change. We live in a “mobile first” world today and the reliance on an outdated and clunky website solution for online shopping and other services is simply not good enough.
Develop an app now and make it amazing. Acado currently has the best app for online groceries in the UK and Sainsbury’s should aspire to develop something with at least that minimum level of capability. This includes:
- Clean UI with very powerful search and filter capability.
- Ensure that all product attributes are available including ingredients, nutrition, allergy, distance from origin (in miles), etc. Any and all of this information should be available in the** search and filter** (e.g. exclude all products that contain gluten when browsing).
- All for scanning of products to locate a product – for use in home but also for showrooming – why not? Go completely transparent with your pricing.
- Provide a shopping list functionality so that it is easy for consumers to add items to their shopping list during the course of a day or week and then decide when they are ready to shop, the list is already there.
- Add a huge database of recipes – negotiate deals with AllRecipes or Epicurious that are easily searchable by categories or ingredients. And then provide a one click option to add the ingredients to your shopping list (something that the Acado app does well).
- In addition to full recipes, take the top 200 cookbooks and add all of the ingredients to each of the recipes. No need to show the recipe itself as these would be the intellectual property of the author – but they could offer a search by book and recipe name (or page number).. so something like “Jamie Oliver, America, page 26” – the name of the recipe is there plus the ingredients with an “add to shopping basket” button.
- Have staff monitor prime time cooking shows and make sure that the ingredients for any recipes that are discussed are available in a simple – one click method.
- The ability to shop in store with the app. Why invest in “Scan and Go” technology when most people have phones with them. Why not build this functionality into the app. When a consumer is adding items to their shopping trolly/cart, they can simply scan with their phone.. and check out before they leave. With the use of NFC sensors this could easily be securely monitored.
The Sainsbury’s Local stores are there for convenience yet many of the stores that I’ve visited are not equipped with contactless payment systems. The benefit of contactless – either by card or a mobile system like Apple Pay – is all based on expediting the checkout process. This needs to be corrected immediately.
They should also eliminate the need to carry a Nectar Card completely. Who needs another card to carry in their wallet or purse. Link purchases with mobile technology – Apple Pay, Google Wallet or via their own mobile app using NFC/iBeacons/BluetoothLE, whatever. There are better ways to track purchases than to force customers to carry an extra piece of plastic with them.
Artificial Intelligence, Big Data
The Nectar system tracks purchases and offers savings in return, but it is limited in providing true personalisation. Sainsbury’s should implement a [better] recommendation engine based on a profile provided by the consumer combined with past purchases.
This could occur in store via iBeacons but also via the app / web site. Introduce new products that I might like based on my preference for locally produced goods or my dietary preferences. For each item I purchase, provide recommendation for recipes that use that product or some information about where it came from.
And perhaps go even further by turning this is into a Siri-like, AI-powered shopping assistant rather than the current approach of bombarding me with annoying marketing and cross-selling messages. When consumers are provided with their own shopping assistant that appears to have their own interests in mind, Sainsbury’s could sell more but in a far more effective and sophisticated way. The technology is available today to achieve this.
Could it happen?
I believe that Sainsbury’s could reinvent itself as the most technologically advanced supermarket in the UK. The suggestions above are just scratching the service of what could be achieved.
It appears that the new Sainsbury’s CEO has some plans of his own in this area. I hope that he can push the company to be a category leader and escape the safe and yet precarious position of being ok, but nothing special.