Coles is moving into the “future of grocery shopping” this week as it ditches traditional paper catalogues and concentrates on a fully integrated online experience – but consumers should adopt the new experience with their eyes wide open, one expert warned.
The supermarket is scrapping its home-delivered print catalogues in favour for digital channel ‘coles&co’.
Queensland University of Technology’s food and grocery retail expert Gary Mortimer said the enhanced digital catalogue will allow users to shop directly from the page – brought to life with recipe tips, videos and the ability to add directly to an online order.
“It moves away from the transactional experience of online shopping,” Associate Professor Mortimer told The New Daily.
“It will become customised to your shopping habits, so if I don’t have a cat, my catalogue won’t have cat food offers on it.
“If you’re a vegan and you haven’t been buying meat products eventually that digital catalog won’t have meat products offered to you.
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“So it’s quite an interesting way that we’ve seen supermarkets move away from doing a mass-market catalogue to everybody, to a digital one that’s customised for a more efficient way to market products to your customers.
“I would consider it the future of grocery shopping.”
Professor Mortimer noted Woolworths has long had the one-up on Coles in terms of its online shopping experience, but Coles will surge ahead with a product that has “all the bells and whistles”, when it launches on Thursday.
Enter, if you dare
Sure, a catalogue that knows what you want and offers you specials on the items you buy more often sounds great, but it all comes with a trade off: Your data.
The warning comes from Deakin University marketing lecturer Michael Callaghan, who equated Coles’ new product with the famous red pill from The Matrix.
Dr Callaghan said the platform would be underpinned by Flybuys, which means Coles will be able to track not just what groceries consumers are buying, but what other online retailing sites they use, what content they interact with most – a profile of their shopping habits.
“From the consumer behaviour marketing point of view, this is a wonderful gold mine,” Dr Callaghan said.
“They’re going to know a lot more about individual customers than they ever have before.”
In flagging the launch of the platform, Coles said customers can sign up to coles&co to “unlock new exclusive content and previews of weekly specials, including many at half price”.
These specials will underpin how Coles seeks to win the lion’s share in the competitive supermarket landscape, Dr Callaghan said.
No more junk mail. New Coles & co will provide weekly specials, information on new products, shopping tips, recipes and video content, all customised for individual shoppers. https://t.co/HruPBz3wog
— Professor Gary Mortimer 🛒🛒🛒 (@ProfRetail) August 11, 2020
The premium product
At the moment, most customers split their shopping dollars between the big two, give or take some dollars to the likes of Aldi or Costco.
What Coles is trying to do is get into people’s pantries before Woolworths or anyone else even has a chance.
Because Coles sees your shopping history – a vegan, doesn’t own a cat – you’ll be targeted with specials and deals relevant to you.
“When we get to this level of electronic support it starts to become very much a benefit to giving your loyalty to the one retailer,” Dr Callaghan explained.
The trade-off is a slippery slope, he continued.
Speaking with a tin foil hat on by his admission, Dr Callaghan said this platform could give retailers the power to sell products at a price individual customers were willing to pay.
“… Particularly if it’s not an advertised shop price that everyone can see, the special buy that I get offered may well be completely different in pricing to what you get offered for the same product,” he theorised.
“I would suggest that there would definitely be pricing variations between geographic areas, if they’re implementing this properly, and it does open up a whole new world – not just targeting it to the sort of products that you might be interested in as individuals.
“The next logical step is to work out what the pricing tolerance might be for those individuals.
“So you might be more inclined to pay a little bit more for Cadbury’s chocolates than I will, so we’ll get two different offers: I’ll get a cheaper one than you because they know that Cadbury’s chocolate is a soft spot for you and you’ll pay anything for it.”
Coles stopped distributing en masse physical copies of its weekly cataloguing in April as the coronavirus pandemic destabilised supply chains.
It said it will still offer some copies in store.
Woolworths was also forced to change part of its core business practice, putting a hold on weekly specials.