Self-Scanner a Bridge to Cell Phones at Stop & Shop

MICHAEL GARRY

NEW YORK — Stephen Vowles, senior vice president of marketing for Stop & Shop/Giant Food, believes that his company's Scan It! portable shopping device positions it well for the digital future when shoppers will use mobile phones and PDAs during their shopping trips.

Housed in a portable handheld scanner from Motorola, Holtsville, N.Y., and driven by software from Modiv Media, Quincy, Mass., Scan It! allows loyalty card shoppers to scan and bag all of their purchases and pay at the checkout without additional scanning; it also delivers targeted offers that are triggered by a shopper's location in the store and other factors.

Stop & Shop/Giant, a division of Ahold USA that operates 560 stores on the East Coast, now offers Scan It! devices in more than 280 stores, or about 30 more than last fall. Vowles said the rollout will continue. The devices were launched about 2½ years ago at about 20 stores.

“We have something powerful and interesting today that will be a huge bridge to the digital future,” Vowles said earlier this month at The Aberdeen Group Retail Summit here. He noted that the chain is “not too far away” from the point where mobile phone/PDAs owned by shoppers will replace the Scan It! device.

Phones and personal devices are already being used to create lists and plan shopping trips. If the phones can be made to work in stores as well, “then you've got something potentially powerful,” he said, “a revolution in grocery shopping.” The stumbling block, he added, is the scanning capacity of mobile phones, whose cameras “are OK for scanning one item, but not 60” in a typical shopping trip. “But that will stop being a problem.”

Vowles said the Scan It! device represents “a big part of our business,” used by more than 7% of customers and accounting for more than 10% of sales (13% at many stores), 1 million shopping trips per month and $1 billion in annual sales. The devices “help us to sell more” because of more frequent trips and bigger baskets. (Most shoppers use the devices for large orders.) “They also make our front-ends more efficient.” Vowles added that while shopper usage of the devices has already exceeded the company's economic targets, “we absolutely plan to increase it.”

In targeting shoppers through Scan It!, Stop & Shop is able to segment shoppers according to type (such as “interested in quick, time-efficient solutions”), shopping history and location in the store. CPG companies are thereby able to provide “very relevant offers at the moment they will have the most impact,” said Vowles. In addition, rather than the blanket discounts found in circulars, the offers in Scan It! can be tailored to “just enough money to just the right person.”

ORDER IT! AT DELI

Stop & Shop/Giant has also deployed the Order It! deli system in more than 400 stores to date. The system consist of an overhead screen announcing order numbers and showing ads, a ticket dispenser, a workflow organizer for deli employees and an ordering kiosk for shoppers. “I have been responsible for several failed kiosk projects during my career but this is a kiosk that actually works because it has a purpose,” said Vowles, who worked for Sainsbury and Procter & Gamble in the U.K. before coming to Stop & Shop/Giant seven years ago.

Loyalty shoppers can scan their cards at the kiosk to call up favorite purchases on the touchscreen, and CPG companies can offer targeted messages to those shoppers on the screen as well. Shoppers can select weight, thickness and estimated price of each selection. When their order is ready the order number is announced over the store sound system and a reminder is sent to the Scan It! device or to a mobile phone, if selected.

Both Scan It! and Order It! have been successful, said Vowles, because they deliver benefits to all three relevant constituencies — shoppers, CPG companies and Stop & Shop/Giant. He likened the store devices to airport check-in kiosks, which meet the needs of passengers, airlines and airports.

At a panel discussion after his presentation, Vowles described one of the components of a good loyalty program as being able to “enhance the conversation with the customer — talk in some way to the customer in greater depth and more often than you do now.”

Asked to compare Stop & Shop/Giant's loyalty efforts with those of Tesco, Vowles said that while his company collects as much data as Tesco, “I don't think anyone in the U.S. is as advanced as Tesco in using data to improve the customer offer or on the marketing side, but we certainly see that as the way forward.”

Kroger, which partners with Tesco-owned Dunn-humby on its marketing programs, is the U.S. leader in paper-based direct marketing campaigns, said Vowles. “But I do think that the digital revolution gives us the ability to reset the clock a little on that and make sure that using digital communications methods we can replicate some of their success and maybe beat it.”