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Interview

Interview: The Evolution of the Grocery Shopper, with Peter V.S. Bond

Peter V.S. Bond, well-known as the co-host of the CPG Guys podcast, has a day job as VP Strategy & Retail Partnerships at PowerReviews. He put on that hat to share the results of a brand new survey of 4,000 consumers on the evolution of their omnichannel grocery shopping behaviors. Great data, with some powerful takeaways for brands. 

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CPG Guys Podcast

TRANSCRIPT

Peter:

Welcome to unpacking the digital shelf where we explore brand manufacturing in the digital age. One Peter Crosby here from the digital shelf Institute, Peter V S bond well known as the co-host of the CPG guys podcast as a day job as VP of strategy and retail partnerships at power reviews. He put on that hat to share the results of in brand new survey of 4,000 consumers on the evolution of their omni-channel grocery shopping behaviors, great data with some powerful takeaway for brands. So Peter, this is power reviews. First grocery shopper survey, since 2017, a lot has changed since then. God knows. What were some of the changes or current state of awareness you thought about as you designed the new survey.

PVSB:

Thank you for that question, Peter, it's good to be here with you and Rob, probably what came first and foremost to my mind is I control the marketing department to feel this survey and update was the fact that we had this very rich longitudinal touch point from 2017. And a lot of the questions that we asked were still relevant today. So to be able to look at how those, how those consumers were changing their position, and to start to insert a couple of core components that we thought the pandemic dictated notably around safety, that, that it would be quite telling. So there are a couple of things going on right now. Um, uh, Costa did a survey recently that found that 75% of shoppers are planning to stick to at least some of the new shopping habits post COVID. I mean, one of the things I personally experienced I'm sure y'all did is the fact that, um, out of stocks and supply chain issues forced me to make substitution choices. I also recently spoke with Pako Underhill, uh, the notable author of why we buy. And he stated to me that after we get to men of a certain age, uh, we'll say over 40, that 80% of what we buy is exactly the same week over week,

Peter:

By the way, Peter that episode. Uh, so, uh, just to make sure I mentioned it in the intro, but, uh, Peter is one half of, of CPG guys podcasts, a must listen. Uh, but you, that conversation you just mentioned with, with that author, uh, it was tremendous. It was really good.

PVSB:

Thank you. And we're very excited about having him, but he said 80% of what we buy week over week is the same. So being forced to change that is out of the norm for many of us, particularly me, um, incisive also predicted that by 25 online grocery would account for 21% of grocery sales or 250 billion. You know, we, we saw some say five, some say 10 years, e-commerce adoption acceleration during this pandemic. We wanted to understand how that occurred and to break it down against different demographic groups. But that is that's pretty powerful. You know, the, the safety issue was the core component that we needed to change. But other than that, we really tried to keep it as, as similar as possible so that we had true longitudinal touch points.

Peter:

Great. So 4,000 responses later, uh, just, um, take us through, you know, when I looked through the report and it had several categories, I thought it'd be fun just to step through each one and kind of what were the aha moments for you and some of those year over year comparisons that really stood out. Um, and I think we, we start with where today's consumers shop for groceries. Yep.

PVSB:

Yeah. So when we looked at 2017, only about 17% of them were shopping online for groceries fast forward to 2021. And it's almost three and four that are using online to one degree or another. And that is pretty dramatic in terms of the shift. I don't think we're surprised by that, but because we have such a large sample size for this, we could break it down into demographic groups. And even amongst, uh, the baby boomers, we saw them adapting, adopting this behavior more than 60% of them said that they were doing it online. So pretty, uh, pretty compelling data that tells us that everyone, regardless of age income, or even geography said that they were, they were shopping for groceries online.

Rob:

I good. So to go back to there's the stats there on the conversation of why we buy there's two things that are interesting. One is just the overall shift to online. The second is the shift in brand loyalty. Now, now you would said something very specific, which is that when something was out of stock, particularly early in the pandemic, people would substitute. And a lot of the substitutions of stuck is there, is there another type of substitution that is inherent to the offline, to online behavioral switch that a Acosta and others are saying is going to stick around for longer?

PVSB:

Sure. I mean, what's on the physical shelf in retail stores is predominantly determined by the power of the brand to get on shelf and in a physical space. So your investment in the circular, your investment in the display and cap, TPRS other types of more traditional things and big brands are noted for being able to control that when you move to the digital shelf, you're presented with so many more options, in my opinion, and from the data we've seen that says, yeah, when you go into that space, all of a sudden you're presented with many more options than you might've otherwise in a physical store where the size of the section of the grocery store dictated the number of products that you could carry. So, um, your ability to, to access them increase what's different from the digital shelf, from the physical shelf to the digital shelf is just the visibility to these products, right on the physical shelf. You stand in front, you can quickly scan on the digital shelf, right. You know, as, as our, as our friend Mike Black at Profitero said the best place to hide a dead body on a retail site is the second page of search results because nobody will find, but the, but the products are there and you have the opportunity. If you have the discipline to go find them.

Peter:

One of the things that really jumped out at me in, in this, in this section that we're talking about in the report where, um, you know, the, the, the top reasons that consumers choose to shop for groceries online, can you just kind of walk them through it or any that sort of jumped out at you or surprise you, or did it seem kind of in line

PVSB:

Well, consistent from when we did it in 2017, the single most important reason people do it is to save time. Um, in 2017 though, the number two was convenience in 2021. When we added this new question that was pandemic related, it turns out that 49% of the respondents said they shop online for groceries because it improves the safety element of shopping, but they're concerned about their safety and not having to go into a physical store and interact with other people is clearly a reason that it's important. So that one clearly jumped out at me.

Peter:

Yeah, it'll be, it'd be interesting to see because when that, hopefully someday soon, uh, reverses where that falls off the list again, um, how much will that having been removed as an element of concern or, or reason, uh, what will that do to the ongoing, you know, to, to the stats that we're seeing about usage of online shopping?

PVSB:

I think the other stat that really jumped out to me on where people are shopping is just the decline in the importance of Amazon, particularly in the grocery space, we saw that other platforms, uh, grew tremendously and important. So marketplaces like Instacart and what have you are. And we, this bears out in the numbers that we see being released by other third-party sources that Amazon it's interesting. I, I really feel like they had a bit of a, um, they skipped a beat during the pandemic in that I thought that their Amazon fresh business would decidedly Lethbridge and the, the pandemic issue, but they had so many supply chain issues overall that they never had a chance to do it. And it was Instacart that actually Rose to the top and seems to be putting on a serious challenge. But, but the fact is, is that Amazon is still an important player, but in grocery consumables, we'll see where they're going. Uh, I'm really, I really think that with their focus recently on opening physical stores across the country, their whole fresh model has shifted from a, from a, from an e-commerce home delivery model to a physical store model. And we'll see how that bears out. And what are the implications for whole foods?

Rob:

Yeah. That line of Amazon declining in importance is I think I completely agree with you when it's one of those, one of those things that I think most people miss, because, um, I mean, even now there, I saw a few days ago, the total percentage of e-commerce that Amazon has increased last year. So it was in the high thirties a percent and it just crossed 40% of the total e-commerce share. But in grocery, I think Instacart's over 50% of us online grocery, and then you've also got others. Like goPuff had a hell of a year.

PVSB:

I just had a go puff order delivered to my house last night. It arrived 20 minutes after I ordered it. Can

Rob:

I ask what was in it?

PVSB:

Date chocolate chip cookies. Yes. There were some, a bag of single-serve potato chips to give to my daughter to keep her quiet in the car, uh, and a couple of, uh, personal care items. And that was about it. That's amazing. But yeah, go cough is a very, very interesting, uh, business model and profitable. How was that profitable?

Rob:

So, so it's interesting that I w it is profitable. There are unit economics are actually kind of amazing. Um, basically what they're doing is they're competing in effect with convenience. They're competing with seven 11 and CVS and Walgreens. And the way that they do it is they get cheap, large warehouse space. That's that's as centrally located within a Metro area as possible. And then their drivers, unlike Instacart or Uber eats or whatever the goPuff drivers are, goPuff employees. And, and the way that they, that they account for all this overhead is it's cheaper for them to have the warehouse space than it is for seven 11 to rent retail in, in prime shopping location. So overall the margin works and then they can, they further compete by having more and more assortment than you could fit in a seven 11 that's walking distance in downtown Boston or whatever. So you can get any flavor of Ben and Jerry's delivered to your house in 20 minutes.

PVSB:

I think also what's intriguing about goPuff. I know we're a little, uh, off our core topic here, but the fact that that last year they went and bought BevMo one of the largest, totally private alcohol brick and mortar retailers in the United States with 160 stores in California, Arizona, and up the coast. That's a very intriguing, intriguing situation. Um, stay tuned to my podcast. You're going to see some, some conversations going on with go cough.

Peter:

Oh my gosh, I'm envious, but I can't wait to hear it. Um, so, you know, if we've gotten off track, it's my job to bring us back on. So let's move on to, uh, how consumers shop for groceries online. Uh, give us the highlights

PVSB:

In terms of the services they're using. What's interesting is, as I mentioned, the online services only, so Amazon fresh think boxed or drizzly, it's actually declined year over. Even though we see drizzly as a marketplace, uh, occurring and, and them having, they do have a, uh, a brick and mortar relationship in their marketplace strategy. We saw that in 2021 only about 22% of the shoppers said that they were actually shopping online versus 39. Uh, previously now granted in, in 2017, it was a much smaller set of consumers doing it locally, grocery stores or big box stores. That's where all the growth was. Walmart target, all of them. We saw that go from 38% to 65% of respondents. That is huge. Think about what Walmart and target have invested in their delivery or pickup services. It's phenomenal to this morning, I ended up going to target to do a drive-through pickup.

PVSB:

And then I went next door and I picked something up from best buy as well. And I had two orders that I had to pick up. Cause after I put my first order at target, I realized I need more items than I did a second order. So I know I'm totally hooked on, on click and collect. It is what I love to do. And it's very easy. Um, the other thing is meal boxes. That's interesting in 2017 things like blue apron, HelloFresh home chef 34% of the respondents said they were doing it only 15% are saying they're doing it now. So I don't know if that's more a factor of, uh, the fact that we have a much larger sample size. We're also because a lot of them are actually just choosing to do the home meal prep themselves and not do the simple prep because people are becoming more Vermont. I know, certainly I, well, I've already always been a big, a big home cook, but the fact is this pandemic made it even more demanding on me. And as a result of that, I ended up stepping up my game and I cook a lot more from scratch. And don't avail myself of these, of these meal prep solutions. We'll see how that changes as we come out of a pandemic.

Peter:

Interesting, because you would think in this time meal boxes would have been, Oh my God. You know, we can't go out. Um, it's too expensive ordering stuff out, but I think, and there are certainly stats showing that that cooking at home has taken, you know, there's huge consumption of, of online training and courses and things like that. So that suggests to me there's a more with the services.

PVSB:

Well, I can tell you, you don't have to take my word or the word of this, uh, survey that retailers are focusing on that yesterday, Kroger, as we record this yesterday was Kroger's annual investor day event and stored Aiken, their chief merchant, when to painstaking lengths to detail how much they were, they were betting on ready to eat or, or ingredient based meal plans for their consumers. Their home chef businesses is growing exponentially and retail stores. And they're focused on delivering this a measure of convenience to their consumers. So they think it's pretty important,

Rob:

But the overall penetration status still interesting. Um, like I know anecdotally my parents and my sister, uh, who had never used those services before started relying on them pretty heavily, uh, over COVID. I know my wife and I, and my wife's parents tried them, but, you know, we we're, we're more used to cooking from scratch and S and so compared to cooking from scratch, like if you've got that skill set, they're not, you know, we didn't find them much, much of an improvement, so maybe, maybe you're right. Maybe that is one of those things that the more confident people get, they move away from it. And, but it's interesting. It's still interesting that it's less penetration than 2017. That's that's that's, uh, I would not have guessed that at all.

PVSB:

Yeah. Well, what's also interesting is when you start breaking down the categories and seeing where people are in terms of what categories they're willing to purchase online in 2017 non-perishable package goods. So think center of store shelf stable, right. That was about 58% of consumers saying, yeah, I shop for that online. It's up to 70% now, right? People don't want to. And particularly when you start getting into goods that you consume very quickly and frequently, um, that's where models of Amazon very successful subscribing stapes solution, where you just basically set what you want to buy and how often you want it to delivered. And you never have to add that to the basket again. I mean, I do that with pet food. I do that with diapers. That's what my life is now as the father of a two year old girl and a, uh, 11 year old and her regional account.

PVSB:

But, but that relevant, that really stays in enormous amount of time. And, and they lie and obviously retailers and brands love it because it, the cancellation rate is so infant Tessa only small. So anyhow, back to some of the categories person, personal care items, less than half in 2017, use the internet 64% using it now, but fresh food, 47% prior 56% now. So we're well over the majority, even a home care, 61% drinks is another one drinks is, um, particularly to get to beverages. There was a bulk aspect to it that I don't know the cost associated with. It was a bit cost prohibitive in 2017. I think now the convenience element has taken over and it's gone from 33%, 58% are willing to buy juice, soda, bottled water. So, and even frozen foods from 32% of 52, um, alcohol is the only one that hasn't grown dramatically. It's gone from 12 to 17, but there are extenuating circumstances with alcohol, right? Um, state laws are predominantly the determining factor on the ability to grow. This. What I can tell you is, is most interesting is if you look at some of the content that Instacart is putting on their blog, they're trumpeting the fact that they in fact are the largest e-commerce outgrow alcohol marketplace in the country. It's not, it's not the people up in your neck of the woods. It's actually the Instacart team Instacart bought drizzly, right? No, uh, Uber bought drugs

Rob:

[inaudible] Oh, you got it. Yeah.

PVSB:

It's really interesting because what are they doing there? They're basically building in the supply chain capability to enable that, but then you look at what goPuff did with, uh, with, with BevMo and all of a sudden they have a, a neighborhood market for alcohol that they may be able to build into their model. So all sorts of interesting things going on in this space,

Rob:

I would think about the alcohol about the alcohol staff though, is I remember in, in Q2, I was talking to a senior executive at a, at a top three out Bev, uh, manufacturer in the U S and um, Ms. Datta, I remember is that with every bar in the country, every resort in the country, every casino in the country and every, you know, and so forth, all shut down, people, not on planes, uh, the growth in e-commerce sales or digital related sales for them almost made up for the loss of sales through, um, the on-prem channels. And people early in the pandemic were obviously drinking an absolute ton, but I would have expected that, uh, the online printed penetration rate on, on alcohol purchasing to be higher. Um, what are the things that maybe is hiding from it is, I know in Boston, my wife and I spent most of the pandemic in the country, but when we came back to Boston, every once in a while, uh, cocktails can now be delivered as part of your, uh, you know, Uber border. And like, we ordered a lot of cocktails every single time we ordered pizza. I mean, it was like, I just really hope that sticks around. And I just wonder if those types of things are missed in the, uh, in the penetration.

PVSB:

It might be. I also am fascinated within this whole alcohol, uh, adult beverage space, the emergence and the growth of [inaudible] like the JV between, uh, Carrie Dr. Pepper and AB InBev, which is drinks works your personal cocktail machine. Like, you don't know how to mix if you're too, if you don't feel like actually mixing the cocktail, according to the bartender's guide, and you want them to do it for ya, this machine will do it for you in perfect proportion. So good on, good on them. I know a couple, I know one person in particular, a friend of mine who went from drizzly to join, join the drinks works group, and see, they see a huge opportunity with that. The other thing I want to say about, about the data is, and this gets back to the issue. We talked about the substitutability and the fact that people were forced to make, make new choices.

PVSB:

You know, I remember talking to, uh, uh, Omar, Hey, Hakan, our friend had bimbo bakeries and they made a strategic decision to get at the beginning of the band pandemic to reduce their assortment and focus on only manufacturing core items for the supply chain and leaving the tail end of their assortment kind of out of the equation. But you're forced to make decisions at that point. And we asked people, are you open to buying products online that you haven't bought in person in 83% of them said, yeah, they are. And this gets back to the space where the digital shelf Institute plays an enormous role, right. Which is in the absence of being able to physically hold the product, what do you need to deliver to the consumer customer experience on the digital shelf that can get them over the hump of saying, yeah, I want to try that right? Where the content plays very well. The description, the image is not the hero image, not just the hero image, but the alternate images. And then of course my space, which is product ratings and reviews.

Peter:

Yeah. Which, uh, I, the thing that really leaped out at me from there is the confidence that it takes for the consumer to do that. The fact that 83% are open, how does a brand take advantage of that openness and actually get the consumer to make the decision in their favor? And you're absolutely right. It's a combination of, of so many things, but a lot of it does happen on the product page. And that kind of takes us to your sweet spot, which is the impact of reviews on, on grocery shopper behavior.

PVSB:

So we've done an enormous amount of research and I'd encourage anyone just to go to power reviews and look at the resources and insight section. We've done a lot of work with instant behavioral studies with data coming from Northwestern and other entities. But for this purpose, look, stick to what, what our consumers are telling us. What jumped out at me is that 82% of all of the respondents said that, uh, that are shopping online, said that they use product ratings and reviews for their purchase. As at least occasionally in fact, 17% said they use it always in 25% said regularly. So we don't

Peter:

Believe that the 18% say they don't use it are lying. I mean, it's gotta be a hundred percent of people that it doesn't make any sense

PVSB:

Probably means that they may be there. Maybe their kids do their grocery shopping for them. So they don't even look at it. But in any event, I agree with you. I think that ratings and reviews are ubiquitous in how we go about our lives. I, I don't choose a restaurant without looking at it. I don't choose a hotel without looking at it. There are so many things that I do. And I think about even when I walk into a store, the, the, the dollar threshold of the value of the product that I'm willing to look up reviews on has dropped precipitously from five years ago. I love to tell this one story. And I think it's anecdotally valuable when my wife was pregnant in her first trimester, she suffered from nausea. So she gave me a list of approved nausea medications, um, that were from her OB and sent me off to the store.

PVSB:

So sitting there in the grocery store in Chicago, I, I found for the items on the list and being a rating and review person. I opened up my, the app for the grocery store. I won't name them by name, but, uh, like most grocery stores at the time ratings and reviews were not available. And I did what, what at least 50% of consumers do when they're in physical stores and they want content and can't find it. I opened up my phone and I went to Amazon and sure enough, those four products had ratings and reviews, but there was a fifth product that wasn't on the shelf. It was on the list and it had the best rating and reviews on Amazon. So sitting there in the middle of the store, I ordered that product on prime now. So I say it any grocery retailer that doesn't doesn't have product ratings and reviews on your site do so at your own peril, because there's this lovely little company and in Seattle, that's more than willing to do it. And they'll steal shoppers from you right. From within your store. Okay.

Peter:

And following up on that, Peter, I mean, I think there, we talked about this a little bit. The other day, when we were prepping for the podcast, the, um, the opportunities are now really starting to come to life in, uh, in the achievable way for grocers to give access to that content inside the store, you know, digital, digital ways to access inside the store and not make you have to go to Amazon to get that content.

PVSB:

Yeah. Let's look at what best buy has done, right? Best buy has got digital shelf tags that update and tell you what is the star rating and the number of reviews. So there's a lot you can do. You can put that at least that little tidbit of information, you can put that on a shelf tag, and you can update that on a frequent basis. That is not something that is outside of the realm of possibility. I am working with one retailer on that right now. In fact, even the concept of putting a QR code on the shelf tag that actually takes you to all the written reviews you can think about putting that content on and deliver it to people and make it very easy and frictionless for them to get to that content. What we can tell you from the study, the survey is that 47% of the respondents say they are using ratings and reviews more now, um, for making grocery purchases than they than, uh, than they did prior to the pandemic.

Rob:

Yeah. I think that makes a ton of sense because it's, if you're doing grocery shopping more often for more things, then you're not just buying staples that you're familiar with, you're doing more of your total shopping, which means that you're buying products that you don't have as much confidence in, which means that you definitely are going to be relying on the ratings and reviews more. That, that doesn't that 47% more doesn't doesn't surprise me. I love the shelf tank idea, by the way. That's, um, Amazon had that in their four star stores. It's about the only thing I liked about the four-star stores. I found the experience kind of confusing. Like, why am I here? What's even in here, but they've got the tags with the ratings on each of the products,

PVSB:

You know, like, like you Rob, when I walked into the Amazon four star store on spring street and lower Manhattan, a couple of years ago, I was perplexed by what the format of this store was. It made no sense to me. Was it a Curio Emporium? It certainly wasn't a bookstore. It wasn't. And it took me a little time after the experience to really understand what the purpose of the store was. It was purely to test whether the secret sauce of Amazon in the digital format, notably their ratings and reviews would work in a physical format. And we know that it worked because six months after they introduced that store, they retrofit all of their bookstores to display the star rating. That's what the purpose of the four-star store was. It was never about the assortment. In fact, if you actually looked at what the fine print, it said four stars plus Amazon basics. So there was a lot of products that weren't there, but they were about trying to leverage the trust and authenticity of that average star rating and the number of reviews. And apparently it worked because they are expanding out that capability. Now that's what their estimate

Peter:

Of an Amazon. Yeah. And so what that, it was something that jumped out at me. You had to review consumption by generation, which I thought was interesting. And going back to Rob's point earlier about, uh, about sort of who doesn't read reviews. When you look at the data it's kind of 26% of baby boomers who never used reviews, but then when you get your work, your way down to the millennials and gen Zs, it's a huge jump upwards. And I sort of feel like, and I'm being a little bit pejorative here, but that baby boomers trust themselves, millennials and gen Z and beyond trust their community, it's their tribes. And that shift is clear. And I think that that shows up in this data. Yeah, I think it,

PVSB:

I think you hit it right on the Mark. Peter. It is very tribal. I'm amazed how often, I think of a particular time, I was sitting at a restaurant in Vancouver next to a bunch of, of gen seekers and they didn't talk the entire meal. They just texted messages back and forth to each other and they would giggle and they were clearly all communicating with each other, but they weren't actually verbalizing it. And so they're very accustomed to this format and digitally connecting. And I'm not surprised by the fact that we see, you know, 89% of millennials saying you have, this is, this is the way I want content. What also is very interesting to me is when you start breaking down, we talk a little bit about the Amazon secret sauce of the star rating and the review account. Some research that I saw from the BAME art Institute, uh, is, is further, um, solidified in this data, which is 67% of the respondents said that customer opinions about specific product details are very important.

PVSB:

Baymard said that the, the most, the most used component of the rating and review section of the product page is the ability to click on and filter down to one-star reviews. And that's because people want to see how absolutely bad the product really could be. And so this, this, this dovetails with that customers want to get to that. So what I say to a lot of brands is leverage that content that you've collected, and don't just have it live in that predefined space on the product page, put it as verbatims in your image, carousel, put it on your sponsored Instagram ads, put it on the home page of your brand's site, whatever it is, but use it to build trust and loyalty because that's what people in highlight the verbatims that play to what the data says is the most, um, the most positive appreciated aspect of your product attributes.

Rob:

Yeah. I liked the, uh, the idea that the clicking on the one stars is the most used. And it makes me think I'm going to tie that together with the generational comment. Cause you talked about the boomers and the millennials and gen Z millennials, but you missed the most important generation, which is gen X. And you've got to imagine that the gen X-ers are just not realistically saying, Oh, this product sucks. Anyway, once the lights,

PVSB:

I think what's interesting too, is, uh, actually about the source of product ratings and reviews. The best estimate I've seen is that, um, all of the ratings and reviews are only are written almost exclusively by 4% of shoppers, that it's kind of built into your DNA, that you like to do this. And therefore, those are the people who do it. I it's built into mine. I love doing it. I've been doing it for years. I was, I was a Yelp elite three years in a row. At one point when I was reviewing restaurants during my years in Cincinnati. Now that I have a, now that I have a daughter, I don't get to go on the COVID between those two. I don't get to go out anywhere for dinner anymore.

Peter:

So, um, I wanted to, before we leave this, this section, I did want to double click on something, excuse and fun. Cause I want to talk about click-through rate because I think for our brand manufacturer, exact listeners, what you were just hinting at, which is, or saying overtly, get your verbatims and put your reviews to work outside of the product page. And because tell him, tell him to tell our listeners about that click through rate.

PVSB:

Yeah. So when UGC drives a substantially improved click-through rate, like when I, when I look at retailers, I'm I understand that if your content lives only on the PDP, you're much further down in the funnel at that point, your goal is to get, get connection with the consumer much further up, certainly in the consideration phase, right? So if you don't have UGC on your listing pages, either on, uh, through, through the search results you get, or as you drill down to the category level, why are you going to present me with 10 products and not help me further filter? You're going to make me open up every one of those. So there are some grocery retailers that have UGC. They just don't have it until you get to the PDP of such a, that's such an injustice. If you also know that 50 to 75% of all basket ads in grocery occur on the listing page, you're foolish not to use at least the star rating and the review count as a snippet, along with your hero image and product description so that they can just click the add button. If it's a low enough value decision, that may be enough to drive the conversions. So UGC should live there, but it can also live, like I said, creating awareness on, onto sponsored ads. And then, and then further down where you start putting it on even the homepage of your brand site, that in that case, it's, it's beyond awareness. It's actually, they have interests because they've come to your site, but now you want to direct them to the products that people like the most.

Peter:

So Peter, just in the interest of time, I might jump around just a little bit and I want to go to, uh, to how reviews can impact in-store grocery shopping behavior. Yeah. Talk us through that because I think that, that, again, we're in this omni-channel world, blah, blah, blah. But it is, it is true. And in this case, uh, shows up in the data.

PVSB:

Yeah. Yeah. So, um, not surprising because this is kind of where the, where grocery has been first digitally engaged coupons are very, very prominent in terms of how we in store shoppers are using, um, particularly their phones is as information devices, right? So in 2017 in store grasp grocery shoppers used, um, use their phone to find a redeem coupons. It's 32%, it's 67%, 2021. So more than double. Um, and they also use it for things like creating shopping lists. This is where shoppable recipe apps are incredibly powerful because it reduces the friction, right? It's not just, it adds it to my shopping list. It can actually add it to my basket, but for in-store shoppers that want to do that shopping, the shopping list is perfect. You can use it to browse recipes again, combining those two experiences. But the real killer here is to what you asked Peter in 2017, 17% of the respondents said they used, uh, their phones in store to read product ratings and reviews. It's up to 42%. That is a big jump for what is considered to be a low value purchase decision, traditionally grocery items. Uh, and you know, obviously price is still a core component. People are looking for price, uh, 27% in 2021. But for, from our perspective, the fact that, you know, almost half of all shoppers that are in physical stores want to use their phone again, cautionary tale for retailers. If you don't provide it to them, not, not only will, will Amazon, but increasingly Google will too.

Peter:

Another stat that stood out to me, um, while shopping in a grocery store, are you more likely to purchase a grocery item you've never bought before? If you're able to read customer reviews and it was 64% said, yes.

PVSB:

Yeah. That's, that's a big number. That's

Peter:

Incremental revenue.

PVSB:

Well, it is, it is. And I would say to anyone, I, if you're putting, if you're in a physical store and you're putting out a display, I walk into a target store the other day, and I saw a NYX cosmetics. And on the header of their corrugated display, it not only said 4.5 out of five stars, but it said 4.5 out of five stars@target.com. So they tailored the actual physical display, not only to display UGC, but to tailor it, to align to the UGC that could be found on target.com or the target app. Really great effective use of content in the physical store.

Peter:

So let's close Peter, um, with your, your recommendations, uh, for grocery business in terms of putting ratings, ratings and reviews to work for the consumer.

PVSB:

Yeah. So a couple of things that, that, and this is our, this is our survey, respondents speaking, almost half of them said they want to see ratings and reviews in the app. If you don't have it there, you're missing the opportunity because everybody walks into the store with, of these devices and they are smarter than they were before the smartphone came out.

Peter:

No question, our listeners at home, Peter just held up his phone,

PVSB:

Sorry, the phone, very blinged out CPG guys phone. I'm never without brand. He's also wearing a CPG guys. T-shirts they know I'm shameless. Let me see the boxers. Go ahead. Now, TMI star, the shelf tag, 35% said they want something on the shelf tag almost a little over 30% said they wanted it on social media. And even 30% said they wanted on the packaging. So if you're a brand, I would say two things, one, a couple of key verbatims. Maybe not. If, if you're like a, an energy bar company, you may not have the real estate on a little package like this, but on the 12 pack that you sell, you got a lot of empty, go look at the store. There's a lot of empty real estate on those boxes. Why don't you do two things? One actually put a couple of verbatims on there because they're timeless.

PVSB:

Right? But second of all, why don't you ask for content? That is one of the biggest problems that brands have, particularly brands that aren't D to C it's hard to gather content other than through exercises, like sampling by for brands that aren't doing direct to consumer, where they have an order feed, and they can just email out a request for content. Think about putting a QR code on your package. Ask, ask customers to write a review scan with any, any, uh, Apple phone and most Android phones. They have QR code scanners built into the camera app right now, just hover over it. And they'll bring up a link, ask them to write a review. Is that going to get you an enormous amount of content all at once? No, but it will get you a steady stream of content and product reviews and gen Z more than ever considers a review that's older than 60 days to be worthless.

Peter:

Yeah. I mean, when you talk, you know, if you'd asked me a couple of years ago, QR codes, I was a QR codes are dead. There's just never, but restaurant because ordering and restaurants are, is, is by QR code. I think the, I don't know the stats on it, but I bet the adoption of understanding how I use a QR code in the moment on my phone has great risks

PVSB:

And dramatically. What what's, what's the, uh, the adage third time's the charm. You know, they created it for the automotive industry. That's where it stayed. Then the smartphone came out, but you needed another app. And there, there was too much friction. The friction's gone and there's a massive amount of adoption. Take advantage of the trend and just ask for your consumers to engage. It also will build your CRM database. Phenomenal.

Peter:

I'm pretty sure it's going to happen in dating. Go ahead, Rob. Sorry. I was going to say the QR codes for me felt like it's not the third. Time's the charm. It's like the 16th they'd been just

Rob:

For so long, trying to make QR codes happen. You know, that movie mean girls, the QR codes happen. It's not going to happen, but how you, right. Actually it's like after, at long, last they've tried enough times where he actually seemed to be taken.

Peter:

And it's the only, it's the only way you can order food and restaurants. You're going to figure it out for sure.

Rob:

Well, Peter, before I let you go,

Peter:

Uh, it's one last important topic that I need to raise with you, which is that, um, I understand that Rob Gonzales has guest appearance on your podcast is your number one listened to episode. And I wanted to find out, Hey, is that still true? And B does that mean that this one will be our highest rated episode because you are here?

PVSB:

Well, to answer the first question, uh, no comment, because I'm afraid it's going to go to go to his head.

Rob:

Victory is mine.

PVSB:

Truth is out. Yes. Rob is our most downloaded episode ever. Uh, there, there is a, uh, a guest that appeared, uh, very close to him. Uh, our fan, our friend guru, Hariharan out at commerce IQ. That, that is nipping at his heels.

Rob:

So good though. I w I mean, if I lose to GRU, I think that's okay.

PVSB:

There are worse people to, to lose too, but yeah, no, there is. And, uh, I'm sorry. The second part of the question was,

Peter:

Was now because you are here, I'm expecting that this will become our number one episode,

PVSB:

And I'm going to shamelessly promote this as much as I possibly can on my personal LinkedIn site on the, on the seat, the CPG guys side, I think will, by the time this airs, we're pretty close to hitting. I think we'll have hit 5,000 LinkedIn followers on our page. So we've got a pretty big audience. So we will, without question, you know, Sri and I were shameless, if nothing else,

Peter:

I do know that, but I'll do a plug too, because I mean, I'm sure everyone listening already, um, listens to the podcast, but please do make sure you follow Peter on LinkedIn, uh, tremendous content on a remarkably high level of frequency, um, and a, and a real true, uh, mention of the industry. So, uh, Peter, thank you so much for, for joining us and walking us through this data. We really

PVSB:

Thank you, Peter. Thank you, Rob. You know, I'm huge fans of the digital shelf Institute and your invitation. Amy joined the executive forum was, um, well received by me. I was very honored and I love being engaged in this and to this community of podcasters like yourselves. I see it not as competition. I see it at all as, as amplifying and helping each other. The goal here, we raise the water. We all have different things and points of view that we bring to it, but it's all about education and you guys do a great job on your podcast. Thank you for having me on.

Peter:

Thanks again to Peter for joining us. If you got value from this episode, please share it with your colleagues, friends, pets, thanks as always for being part of our community.