Kroger Co., the largest supermarket chain in the U.S., is testing sensors and analytics technology to let shelves and products interact with shoppers walking the grocery aisles. The system, which detects individual shoppers through their mobile devices, can offer tailored pricing on specific items and, through 4-inch color display screens, highlight products on the customer’s mobile shopping list. Tests began late last year and are expected to expand in the coming months.
Using sensors and wireless devices to interact with shoppers is a next wave of automation in the supermarket, said Chris Hjelm, chief information officer. “We want to bring technology to life in the store,” he said.
The “digital shelf edge” project is part of Kroger’s strategy to automate and personalize the shopping experience as the chain faces competition online from Amazon.com Inc., Wal-Mart Stores Inc.’s Jet.com unit and others. Online sales are a small but growing part of overall supermarket sales, as the Wall Street Journal reported in October. Among traditional food and beverage stores, e-commerce accounted for $1 billion in sales in 2014, or 0.16% of the $670 billion market, according to U.S. Commerce Department figures.
At Kroger, digital shelves can draw a shopper’s attention to relevant products, Mr. Hjelm said. Displays in a section stocked with nutrition bars can, for instance, show a customer with a gluten allergy some gluten-free options, if he is using a Kroger app. “We know what’s in the aisle and what the mobile shopper has told us and fuse all that data,” he said.
Kroger developers built the network of sensors and analytics software behind the experiment, which is so far deployed in 14 stores near the company’s Cincinnati headquarters. More are expected to run it this year.
Rival Amazon, which continues to roll out its Fresh online service across cities, has set sights on brick-and-mortar grocery stores. It is testing several concepts for physical stores, including one without cashiers, where customers scan their mobile phones on a kiosk as they enter. A system of software and sensors tracks items that shoppers take from shelves and charges their online accounts. The company opened an Amazon Go store in late 2016, offering a limited number of items in a convenience-store format. Amazon is also working on drive-through stores.
A cashier-less store “is doable,” Mr. Hjelm said, but there are challenges. Customers who change their minds may put items back on the wrong shelves, confusing the sensors, he said. Kroger’s similar “Scan, Bag, Go” system lets shoppers use in-store wireless devices to scan barcodes of items, place them in bags and pay electronically. A small-format store may work in Amazon’s favor, he said, with a floor plan that makes wireless technology infrastructure simpler to set up and a limits the number of products to manage.
Source: The Wall Street Journal