March 26, 2019 was the first edition of Emerce Digital Food in Amsterdam. This brand new event was kicked off by Jop de Vrieze, science journalist for NRC and others. Besides 21 speakers, there was also a living lab where you could get nutritional advice based on your dna, experience the life of a cow in the bio-industry with 3D glasses and meet new players in the food market. Here it quickly became clear that in addition to all the technological developments, sustainability and healthy food are also important themes.

The speakers and panelists generally agreed quite nicely. To stay afloat, the traditional supermarket has to start changing. Most of the changes will take place behind the scenes. Questions like: what is needed when there is no retailer between supplier and consumer? How do you ensure sustainable inventory? And what will you do to offer more transparency about the origin of your products? But you as a visitor are also going to notice a difference in the store.

The traditional supermarket is already changing.

Within physical supermarkets, experience is becoming increasingly important. Look at Albert Heijn putting a sushi bar in the supermarket. Or Jumbo food market where real bakers, butchers, cheese specialists and chefs are at work. Whereas we at Online Dialogue often try to make the online dialogue as good as the offline dialogue, Bart Fischer (independent consultant) actually recommends taking advantage of all the online opportunities and applying them in the offline stores. Through in-store analytics, an awful lot can be learned about customer behavior. This way you collect data from the store and use it to optimize the store. Besides huge food plazas where experience is central, there will be more and more city stores (such as those of Coop) where local residents can get products such as sandwiches and salads.

And the rest goes to online

Many opportunities are seen in the online grocery market. All the emerging players are making it easier and easier for consumers. The market is mainly targeting young, busy families where online grocery shopping is a godsend to make the most efficient use of time. Online, of course, the analytics opportunities are even greater than in the offline store.

Thinking about the future

Machiel Tiddens (Albert Heijn online) shows that at Albert Heijn all scenarios to get groceries or even fresh meals have been thought of. As Jop van Sommeren (Coop) points out, “Digitalization is disruptive, therefore preferring to focus on the customer now rather than on profit.”.

According to Machiel, we are actually going back to the days when the local retailer could pay attention to the customer because the retailer knew the customer. Now admittedly on a much larger scale. With today's way of collecting data, supermarkets are once again able to put the customers at the center so they have an enjoyable shopping experience. Ultimately, the goal is to get loyal customers, then those profits will come naturally.

Albert Heijn is already far along. But the question is: How can AH stay ahead by changing? It's about new answers to existing customer questions. Over the years, the customer question is still the same: what's on sale, what do we eat and how do I get everything in the house?

The customer demand is the same but the technology is different. So the challenge is to take advantage of the new opportunities that technology brings.

Strategy is transition

Richard Janssen (Nyenrode Business University) kicks off the day with his vision of developments within the supermarket world. ‘Strategy is transition’ because the traditional supermarket has to start moving with the market or they won't make it. With transition comes innovation which means investing. This is the advantage of the big players like Albert Heijn and Jumbo versus newcomers like delivery service Stockon and online supermarket Crisp.

Richard mentions three developments he sees in the marketplace. He calls it ‘the battle for customer control. Consumers find it increasingly important to know where their food comes from. A-brands and FMCG (fast moving consumer goods) desire contact with consumers. And sustainability is incredibly important.

There are a number of things that supermarkets must meet to stay in business. Those are network optimization, customer satisfaction, inventory optimization and learning, learning, learning. Where in the past you would say ‘cash is king,’ Janssen is now talking about ‘logistics is king. If you control these things, you make sure you stay in business.

Digital food for thought

Dick Veerman (founder Foodlog) steps to the podium with the question, “Suppose you had to invent mail delivery right now, what would you come up with?” He says the future cannot be predicted but we can predict trends from opportunities and problems. He talks with admiration about meal delivery service Foodora, who started by just trying. This didn't quite take off, but they have built a database from which they can learn a lot.

There is an awful lot of competition within supermarkets and that is another reason why they need to start thinking about e-business. The advantage of e-business is that you can collect an awful lot of data that allows you to know exactly what your customer wants and needs. This data makes it possible to build formulas and start predicting trends. Digital is going to shape trends through new processes, new roles and new collaborations.

Data for better inventory

Arjan Levisson (Slimstock) researches how good chain cooperation ensures optimal availability and minimal wastage. With this, he can ensure the right stock at the right time in the right place.

Slimstock makes inventory optimization software because better inventory management ensures that less is thrown away. But inventory management is complex and everyone in the organization looks at inventory differently. The financial director looks at the cost side, while the marketing director likes the idea of a large stock because then the store never has to be out of stock. In addition, the complexity increases with a larger assortment.

Inventory management is statistics, where you have to look for the right balance. Waste is the result of decisions, you don't choose to waste. Inventory is needed and you try to minimize shrinkage. Cooperation between the chains is very important here. If the retailer shares data with the supplier, the supplier is better able to plan.

Connections between producer and consumer

Practice also shows that not every delivery service catches on; after Foodora last year, even Stockon close their doors last week. During Emerce Digital Food, this was not yet known and Stephan Bosman (Stockon) talked about how they started as a data-driven marketplace for perishables and were in the process of transitioning to fresh produce. The uniqueness of Stockon was the connections between producer and consumer. As a consumer, you bought the products directly from the manufacturer. This made the chain shorter and the products last longer. “Logistics is key” says Stephan and through the cooperation with postNL, Stockon was able to deliver within a day throughout the Netherlands.

Stockon was completely data-driven and learned an awful lot about consumers that way. Stephan added that things are going to change. The future winners, as he calls them, are the supermarkets that provide more of an experience. So the store where you can cut your own herb plants or put chocolates in the box. But weekly shopping will increasingly go online.

It's a very exciting market where a lot is changing. Next year, the digital food playing field will look different again ... with perhaps different players.