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DIGITAL FEED

Why Grocery Retailers Are Teaming Up With Tech Giants

6/15/2018

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Source: REUTERS/ Eric Gaillard
This week in the latest partnership between grocery retailers and technology companies, Carrefour announced it is teaming up with Google to help boost its ecommerce business. The global grocery retail industry has been estimated to be worth $5.9 trillion, and online sales of food and drink is expected to become an increasingly larger part of the industry as ecommerce adoption grows. Traditional grocers are allying with tech partners to receive help with AI, shopper subscriptions, voice technology, digital assistants, and the automatic replenishing of products. The offline and online worlds are continuing to merge as retailers see the tremendous value in partnering with technology companies whose expertise also includes translating data (which retailers have a lot of) into personalized experiences and offers.

The partnership makes sense for both partners as many grocers need the expertise offered by technology partners to set up efficient and digitally advanced operations and technology players can build off of the logistics expertise, supplier relationships, and distribution networks. Historically, many retailers trying to be pure online players haven't had much luck earning profits from storing and delivering food - especially in markets like the UK. Because grocery is such a high frequency purchase for consumers, establishing a logistics path through which other categories can eventually be targeted is key. Food purchases make up from one third all the way to half of all spending in numerous developed countries.

Here are some of the other recent partnerships between grocery retailers and technology companies. 
2018
  • Kroger seals warehouse deal with Ocado
  • Walmart pays $16 billion for 77% stake in Flipkart
  • France's Monoprix agrees to sell groceries via Amazon
  • Carrefour struck a deal with Tencent
2017
  • Amazon buys Whole Foods for $13.7 billion 
​2016
  • Walmart buys ecommerce start-up Jet.com


Click here to read the full article. ​
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