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Supermarkets: High-Tech Hotbeds
Esther Schindler writes "You don't think of your supermarket as the source of geeky innovation, but you may be surprised. For example, in Steven Cherry's Supermarkets Are High-Tech Hotbeds, a Techwise Conversation with Kurt Kendall, a partner and director at Kurt Salmon, where he heads the analytics practice there, we learn: 'A lot of supermarket tech is at the checkout area. Bar-code scanning was already old hat when U.S. president George Bush the elder was allegedly amazed by them in 1992, and retailers continue to experiment with the next logical step: self-checkout systems. There's a lot of technologies out there right now that are being introduced into the retail space to understand what consumers are doing in the store, and heat-mapping is one of those technologies--using cameras in the ceiling to actually track where the consumer's going. What this information tells the retailer is where a consumer is, how they're moving around the store, whether they're dwelling in certain places, like checkout or in front of specific merchandise."
How much tech can you have in an industry with profit margins of 1 or 2%?
I come here for the love
This is just as creepy as all the prism crap:/
Start with the identification process. Create a system where your unique DNA is basically your everything. SSN, Banking, Medical History, etc.. EVERYTHING. Then, when you go to shop, take something leave and let the store's system scan YOU and your items as you leave and it will know enough to deduct it from your banking. :)
It doesn't matter if you are part of a loyalty scheme, pay by card or even cash, 'Big Brother' supermarkets know your every move http://www.guardian.co.uk/money/2013/jun/08/supermarkets-get-your-data
Stores are told,"If you confuse the customer, they're more likely to spend more"
So anymore you see"EVERYTHING IS ON SALE" then you need to think about each on what sales are actually bargains, and what is an already inflated price before 30% off hits and makes it still more expensive than another store.
Also some stores will constantly be in renovation mode, moving stuff all around the store. So if you expected to find bread where you looked last time, think again.
The supermarkets are one of the most active propaganda experts on the planet - the next generation of infowar is being fought there.
Forget the CIA ; their intelligence collection is old school.
The supermarkets want to skew their customers towards raising that margin of about 4% ; even a tiny skew is worth it to them.
So they profile your buying habits, they work out what you buy. They work out what everyone buys. They want to know what kind of person buys the high-end ice-cream, and other high-margin items. Quite aside from the obvious ploys, like putting coupons out for high margin items so you'll get into the habit of buying them, they'll coupon other items that aren't high margin, but they know that people who buy them are high-margin customers.
Alas, this means less shelf space for the items that low-margin customers buy, like basic staples. Who cares, you can get those things from the Mom & Pop store, right? Oh...
A whole host of infowar tricks, like reorganising the store shelves periodically to disrupt your "route" and get you in front of lines you don't usually buy.
The latest thing I have noticed is the freezer cabinets are getting LED lighting and motion sensors. The kids (I am much too mature) run up and down the isles waving their hands to turn on the lights.
"A person is smart. People are dumb, panicky dangerous animals and you know it." - K
Supermarkets can't seem to get the most basic data processing concepts right. If they correctly applied ACID principals to their databases, it would be impossible for an advertised special to not ring up at the discounted price, or for an item picked up from the store shelves to not scan at all. But for us, this seems to happen more often than not, and it's been going on for decades.
Lame.
The self-check is the worst idea since Slice Bread - I absolutely refuse to use them. If there aren't regular tills open. I put everything back and leave the store...
Safeway for example at least in the USA and Canada was or still is using OS/2 to operate the tills. As recently as six months ago I remembered watching a manager reboot a till and on a 17 inch LCD screen it looked like OS/2 rebooting then bringing up their own till software.
You must master your joystick like a fisherman masters bait! - Gimpy
How any of these allegedly high-tech supermarkets have backup generators to keep the food from perishing during a power outage?
Two days ago a Wal-Mart SuperCenter had an extended 16-hour power outage. Rather than act quickly and donate the imperiled food to the local food bank or even have a parking lot sale, the store management decided to "comp" all of it instead, destroying all of it so the suppliers would reimburse them in full.
All for lack of a backup generator that would have cost no more than the business they lost in those 16 hours. High-tech, you say?
Alas, this means less shelf space for the items that low-margin customers buy, like basic staples. Who cares, you can get those things from the Mom & Pop store, right? Oh...
Actually, this just isn't true. Basic staples will always be a main part of a supermarket and have the widest choice.
Yes supermarkets want you to buy the profitable high margin items but the most important thing is that they get you into the door to shop with them in the first place. If you go to a Supermarket and feel they don't have enough choice or, even worse, they don't stock the item you're after, you're probably not going to want to come back.
It's for this reason supermarkets also stock stuff they barely sell anything of, like DIY goods and budget office supplies. Only a tiny portion of customers will want some of these on a weekly shop but it means that a supermarket more and more becomes their first port of call when they need to buy something.
please place your item in the bagging area thank you please place your item in the bagging area thank you.
High tech is sometimes advanced probabilistic models. I know a fellow who works for Kroger on the east coast, and when there's a power issue he's uot busting his tail to allocate the generator resources he has to keep the food stock viable. Thing is, there are so many stores and so few extended outages that it doesn't make financial sense to equip all stores with BUGs. They have a number of mobile generators which can be dynamically allocated as needed. If there's a superstorm they are short handed and some food goes to waste, but it's less loss than the fixed cost of installing a generator, fuel tanks, and maintenance at every site.
Is it just my observation, or are there way too many stupid people in the world?
"There's a lot of technologies out there right now that are being introduced into the retail space to understand what consumers are doing in the store, and heat-mapping is one of those technologies--using cameras in the ceiling to actually track where the consumer's going. What this information tells the retailer is where a consumer is, how they're moving around the store, whether they're dwelling in certain places, like checkout or in front of specific merchandise."
I'd bet most, if not all, their investments are going into this area. We need to ask ourselves if we really want to live in a world like this. Where you walk into a store and the placement of items, the color of the walls, even the music they are playing has been psychologically profiled to affect you in a way that makes you spend your money foolishly. Casinos already pump oxygen into the air to keep you awake longer and provide free drinks to make you do stupid things.
At some point in the not too distant future you're going to walk into a retail space to find instead of music their strange buzzing and clicking noises, followed by some wall displays that flash with strange colors in what can only be described as an epileptic pattern and then you're suddenly going to find yourself outside the store, your wallet empty and the irresistible urge to find the nearest ATM, get more and come back. It sounds like a joke, but it's entirely likely. How far away are we from the entrances to stores having MRIs built into the door frame?
We are treated like rats in a lab.
Or chocolate ready to spread frosting, only strawberry and vanilla, the crap that no one wants. Once that is finally gone (it takes a long time) the shelves are restocked with equal amounts of each.
Once again I show up at the store to find a mountain of coca-cola products stacked to the ceiling with an empty space in the middle where Diet Coke used to be. And there beside it is a tall obelisk of caffine-free diet coke. Still there from last time.
The only time caffine-free diet coke is sold is when someone asks someone else to pick up a box of diet coke and they do not realize the difference.
Maybe they could use those infrared cameras to detect rises of heat and blood pressure as customers stand in front of empty shelves surrounded by unwanted products.
'Aye, I've got it tuff, I do. Cruel world it is. I think I'll go get a "pity me! ask me why" tattoo.
<blink>down the rabbit hole</blink>
self-checkout, heat sensing, etc. etc.
I don't know where you are from but these were "live" in grocery stores in my part of the United States years ago.
Knowledge is how to play a game, intelligence is how to win, wisdom is knowing what game to play.
Why is there not a Store Google? It takes forever to find something.
Table-ized A.I.
Read the article, when you pay cash they cannot track you, they offer coupons based on what you are buying at the time. Articles like this are there to reinforce the idea that paying in cash wont protect your anonymity anyway, so you might as well use your credit card or even get a loyalty card. In other words it's propaganda designed to alter your behavior.
It also makes me wonder...do you have poor reading comprehension? Or did you phrase it that way for a reason?
Not an accusation, but astroturfing is the norm these days.
Aim High! Learn to operate a cash register! Or even better - pump gas!
The High Tech Careers of the Future!
I have a piece of technology that totally wipes out their tricks. It is called a shopping list. I buy what's on it, and that's all. I have no store or loyalty cards and tell them I don't want a tracking card if they ask. I also frequently pay with cash. Finally I won't use the self checkouts. When they try to direct me to them I say something like "I'm in no hurry to put you out of a job".
It's the LCD price tags on the shelves that had me smiling. The ability to adjust prices, wirelessly?
It would help greatly if there was any standards for product data whatsoever. Only very recently has there been any efforts to standardize the metadata on products in a format that vendors and retailers can interchange, and if you think that a large grocer can just swap out all their merchandising systems overnight, the you don't know what it's like to work for a low-margin retailer. The average stat is that $100 of saved expense is equal to an additional $10k in sales. The slightest amount of shrink can be the difference between a profitable store, and a money siphon.
Frankly there are, and have been for years, UPC code databases, but you have to license them, unless you are willing to go for the vastly more incomplete consumer assembled EAN/UCC-13 code sites. My first experience with a licensed UPC database was in 1995, but I was aware of NCR systems where you could get them in 1985 or so. They used to come on QIC-20 tapes for loading into the NCR Tower XP and Tower 32 systems that they used to use to run all the cash registers in the supermarket. Now you can get them on DVD.
There are also food ingredient databases, but they tend to be more sketchy, particularly for store brands, which generally come off the assembly line that's currently cheapest. There is also a push for cost reduction on store brands, so they will tend to initially go with a higher end supplier when they bring out a new store brand something, and several moths after it's out, you'll read the label and find they've substituted corn syrup for the cane sugar and similar cost reduction tricks.
It's a real bitch if you have, for example, a corn allergy, or Crohn's disease, and they've bait-and switched things on you. You also have to watch the fried foods, such as prepackaged dinners, when they decide to use peanut oil instead of some other more expensive oil, because it was cheapest on the commodity food oil market for the plant that week.
They don't data mine this stuff from your frequency marketing card because there would be some legal liability both from a HIPPA information standpoint, and if they changed a formulation, and hadn't updated their database recently enough to flag an allergen at the checkout.
There were Credit Card Skimmers installed in the checkout lines in 21 Bay Area Lucky Stores, followed by rampant buying sprees on the card of the people stupid enough to use the self-checkout lines, which are not very well policed. I definitely won't use the things.
http://millbrae.patch.com/groups/editors-picks/p/credit-card-skimming-reported-in-21-bay-area-lucky-stores
One of the key advantages any established grocery store has is its location. Often grocery stores were build on cheaper land that has now grown significantly in value. The result is that it is very hard for a new chain to acquire the huge prime tracts of land required for a modern grocery store chain. This is why most of the last 20-30 years has seen the most activity in "Power Centers" that are way outside of town. In some cases again town has reached out and surrounded these power centers but typically you must drive to these centers.
So for new radical entrants the price of admission is basically quite steep with the only realistic method of market entry being the take-over of an existing faltering chain with great locations. But with automated logistics combined with internet ubiquity grocery delivery is at the cusp of becoming mainstream. But I think the last piece of the puzzle will be roboticly driven delivery vehicles. Once that threshold is crossed then anyone who can raise the capital to buy some small warehouse along with a small fleet of delivery vehicles plus the initial marketing will be capable of taking on the big players turning their great location assets into liabilities.
So my prediction will be that the smart established players will jump into automated delivery and begin downsizing sooner but that most just won't see this coming and will ignore the upstarts mistakenly thinking that their unassailable awesome locations will see them through.
So even though these places seem very high-tech it will be even higher tech that will win the day.
What's lame is your arrogance matching your ignorance. In parts of Europe wifi digital shelf tags have reached grocery shelves. Those should help but in the US, large grocery retailers are still using manual tags pulled and hung every week by different teams than those who stock who are different teams than those who made ordering decisions at a higher level and different from those at the manufacturing level and so forth.
Sometimes the warehouse sends you product ahead of time for a shelf-reset and it's mixed with a current order for efficient logistics. Sometimes even the store's own coupons for their own brand products fail at the register because of a human error elsewhere. Sometimes items are tagged wrong or manufacturers roll out new SKUs.
Stop your whining and think for a second how much product and data flows through, how many points of failure there are, how many lines of code might have errors, never mind the human factors at every point...
Get back to us when your own work product is error free.
My son recently worked as a supervisor at Kroger. He says that the system knows how many people are entering, exiting, and shopping in the store at any time. It knows how long the typical customer shops, and uses this to estimate when the next surge at the registers will occur. Before the surge happens, a display tells the supervisor when he needs to open another register, or two.
It also watches each line, to determine how long people are waiting for a cashier. The goal is a maximum of two minutes. If it sees that customers are waiting longer than that, the display notifies the supervisor to open another lane.
My own experience as a regular shopper at Kroger confirms that the system works very well, and it does indeed keep me coming back. I'm especially ready to go back to Kroger right after shopping at Wal-Mart, where their system apparently tells the supervisor to CLOSE lanes just as shoppers arrive at the registers!
Re. Bush at the grocery store:
According to snopes.com, "Moreover, Bush had good reason to express wonder: He wasn't being shown then-standard scanner technology, but a new type of scanner that could weigh groceries and read mangled and torn bar codes."
snopes.com then says that The New York Times and several other major news organizations reviewed a tape of Bush's conversation at the grocery store. Only The New York Times writers thought Bush was really impressed. The writers for Newsweek, Time and NCR thought Bush was just making polite conversation.
How can you call self-checkout the next logical step?
Self-checkout systems are commonplace. Even the elderly and tech-averse use them. Heck, I've even seen them in just another random supermarket somewhere in Poland, and that was in 2009.
Contrary to the editorials at the time, George Bush was (allegedly) amazed by scanners that could read damaged barcodes:
http://www.snopes.com/history/american/bushscan.asp
"Your assignment this week - every time you are in the grocery stop in aisle 6 and stare at the capers for 45 seconds, then move on. Extra points if you don't actually buy anything at all"
"Your assignment today is to move one can of tomato paste to the beer section"
"Tomorrow please run quickly through aisles 2 and 7, then stop to pace back and forth in front of the adult diapers for 10 seconds"
"This week, wear heat-shielding on just the top half of your body."
"Stand very still in front of the instant coffee area and move your eyes quickly from top shelf to bottom shelf 5 times, then sprint away."