By: Doug Baker, Vice President, Private Brands, Technology, Industry Relations, Food Marketing Institute
New technologies need to be more than shiny objects. They are useful only when driving meaningful outcomes not otherwise possible. The benefits should become overwhelmingly clear.
In today’s food retail environment, emerging technologies − from blockchain to Internet of Things (IoT) − are beginning to produce clear gains. Retailers are leveraging new technologies to enhance aspects including supply chain, food safety, and customer experience.
Some of the most important use cases include:
- Tracking the journey of products along the supply chain to boost food safety.
- Enhancing the availability of information for customers at the store shelf.
- Monitoring product temperatures to quickly alert retail personnel of possible concerns.
Speakers at Grocerytalk addressed these and other ways technology is transforming the retail landscape.
Blockchain Enhances Food Safety
Blockchain is a technology that is beginning to transform numerous industries, including food. The potential to enhance food safety practices across the supply chain is seemingly limitless.
“Finding the lot of a recalled product can be reduced from days or hours to minutes or seconds with blockchain,” explained a recent FMI blog piece.
Blockchain stores data “in encrypted, time-stamped records – or blocks – that link to previously approved blocks, thus guaranteeing legitimacy and creating a continuous chain of information accessible by all users,” the blog item explained.
Walmart has been a leader in efforts to achieve the promise of this technology in food safety.
Frank Yiannas, Walmart’s vice president, Food Safety and Health, emphasizes that the food industry has been especially vulnerable to safety and fraud challenges, and that until now solutions have been largely ineffective. A big reason is that the industry operates with linear, siloed systems.
“Blockchain and the food system are really made for each other,” he said. “It’s one version of the truth. It’s difficult to hack.”
Walmart has been testing blockchain programs with industry partners and is now “beyond pilot” in efforts with more than 10 major brands and close to two dozen foods.
“Our goal is transparency,” Yiannas said. “That’s what consumers want. The opposite of that is anonymity. Today there’s a lot of anonymity about where food is produced and how it’s shipped.”
Digital Changes the Shelf
New technology is beginning to have a big impact on information available to consumers at store shelves. Kroger recently unveiled a new shelf technology that digitally displays pricing, nutritional information, video ads and coupons. The retailer outlined this initiative, called Kroger Edge, in an interview earlier this year with Business Insider.
The program enables Kroger to communicate and instantly change shelf information available to shoppers. The first version works with in-store, hand-held devices, and eventually it will interact with consumers’ smartphones. It will enable benefits such as highlighting relevant products on shelves, including items for specific dietary conditions.
“We are bringing technology to the shelf edge,” said Annette Franke, Kroger’s vice president of technology.
IoT Tracks Temperature
In another initiative, Kroger has leveraged IoT through the deployment of sensors that monitor temperature and notify store personnel about potential food safety problems. This initiative has been widely recognized for its success in transforming a manual process to an automated one.
Kroger’s gains with a range of technologies led to the launch of its Sunrise unit, which licenses its technologies to other companies. This venture helps to underscore Kroger’s role as a technology leader driving change in the industry.
“Our industry is being disrupted, and we want to be a disruptor,” Franke said. “We are leveraging for others the technology we built for ourselves.”
Hydroponics Advances Sustainability
Technology has the ability to enable a more sustainable supply chain, including for fresh products. A case in point is the company BrightFarms, which runs greenhouses that use natural light and hydroponic systems to reduce the use of energy, land and water. The strategy helps retailers meet the growing demand for local produce.
“We build one greenhouse farm per market,” said Paul Lightfoot, CEO, BrightFarms, which focuses on the packaged salad category. The company’s processes lead to, “fewer steps and fewer miles. It provides a one week freshness advantage.”
In short, he said: “Our supply chain is simpler.”
Simplicity is an important word in describing the results of many of today’s emerging technologies that are changing the food industry. From blockchain to IoT, these technologies aren’t necessarily simple in technical design. However, they can simplify supply chains and customer experiences, in ways that become overwhelmingly clear to users.