CHICAGO -- Internet retailing will force upon brick-and-mortar companies new ways of merchandising groceries and a new culture, said a speaker at the Food Marketing Institute convention here this month.
"It is a complete paradigm shift in the way customers shop, and it really gives us a lot of flexibility on the Internet to sell even more product," said Louise Curcio, vice president of e-commerce at Pink Dot, Camarillo, Calif.
For example, physical stores face constraints when trying to position refrigerated and frozen pasta products together with dry pasta because of the different equipment and fixtures needed to display these products. "When you are in the grocery store, you go by the refrigerated section for certain pastas. Then you go all the way on the other side of the store, and, if you are lucky, you will find the dry foods. On the Internet, all the pastas are together. There is dry pasta and fresh pasta," Curcio said.
"We need to figure out how to merchandise based on how customers want to shop, not how they have been shopping for years and years and years. Is it by sections, by product type, by purchase occasion? Now we no longer have just one endcap next to something. We can put endcaps all over the place because space is unlimited. Imagine space being completely unlimited. You can cross-merchandise or cross-sell to your heart's content," she said.
The Internet will also transform old models of retailing such as grocery stores, convenience stores, pizza-delivery operations and quick-service restaurants. "Those have always been treated as four very different businesses. But with the advent of the Internet, we see an evolving model, the lines are starting to blur, and things are starting to come together," she said.
Even the physical operations of e-commerce operators are different. "You optimize the store shelves for picking and packing. It's all about how quickly we can get this product into the customer's hands," she said.
Pink Dot is a 13-year-old food delivery service that formerly used only phone and fax to take orders. The company moved into on-line retailing last year. Based in Camarillo, Calif., but expanding across the country, Pink Dot promises delivery within 30 minutes. "We've gone from brick-and-mortar to click-and-mortar," Curcio said.