Podcast: Yael Cosset, CIO, explains Kroger’s “transparent ecosystem”
As part of its “lead with new, accelerate with digital” strategy, The Kroger Co. — the Supermarket News Retailer of the Year 2022 — aims to create a seamless ecosystem where customers can switch easily between channels and enjoy the same high-quality experience. This includes switching between physical stores and digital, and between in-store purchases, pickup and delivery.
“Our aspiration is to be our customers’ destination for their dietary needs,” Yael Cosset, senior vice president and chief information officer at Cincinnati-based Kroger, told SN during a podcast discussion. “At the heart of our vision of a seamless ecosystem is an accurate understanding of our customers.”
Not surprisingly, technology plays a central role. On the e-commerce side, Kroger has opened six customer fulfillment centers (CFCs) and nine hub-and-spoke support facilities as part of its more than four-year partnership with Ocado Group. These high-tech facilities use Ocado’s automation and artificial intelligence technology to fulfill online grocery delivery orders, including in markets where Kroger does not have physical stores.
But that’s not all. Kroger, which serves more than 60 million homes annually, leverages the vast data reserves of its physical and virtual properties and brands to create more personalized experiences and value for customers. The company also uses technology solutions and its data and analytics capabilities, for example, to refine its supply chain to improve product freshness, expedite pick-up and delivery service, and introduce trending new items in its Our Brands portfolio.
According to Cosset, Kroger is seizing “the opportunity to leverage data to truly understand what matters to each customer – what they want, from the freshest produce for a simple meal they cook at home to a quality fresh meals when on the green light; when they want it, whether they are shopping for their weekly groceries or looking for an immediate solution delivered in 30 minutes; and also how they want it. in-store, pick-up or have them delivered to their doorstep – all without having to compromise on the freshness, quality or value they get from Kroger.
Overall, The Kroger Co. operates 2,723 supermarkets and multi-department stores under more than 20 banners. More than 2,250 stores have pharmacies and more than 1,600 have gas stations. Eighty-two percent of Kroger’s customers are within five miles of one of its stores, with most living within two miles.
On the digital side, at the end of fiscal 2021, 2,257 stores offered online grocery pickup and more than 2,500 stores offered delivery. Including click-and-collect and delivery via Kroger Delivery, third-party partners such as Instacart and Kroger’s Ship direct-to-home delivery service, the company covered 98% of households in its shopping area with services of e-commerce. Digital represents an annual activity of more than 10 billion dollars for Kroger. Around 18.5 million households engaged online with the retailer in 2021.
“Our seamless ecosystem is about bringing all of our assets together — our stores, our dedicated facilities, leveraging technology, our partners, petabytes of customer preference data — to ultimately bring this seamless experience to life for s ‘adapt to the context of your day, your need,’ Cosset said. “So data and technology are present throughout the entire ecosystem.”