Product Freshness, Green Dot Smart Senors

PRODUCT FRESHNESS, QUALITY AND PRICE BENEFIT FROM GREEN DOT SMART SENSORS

For today’s customers, product freshness and quality, along with price, are the key factors when choosing where to shop for their daily needs. At the same time, fresh products and ready-made meals with a short shelf life are taking up a greater share of the customer’s shopping basket. What matters to customers is a guarantee of freshness. A simple expiration date on the label does not necessarily provide this guarantee – expiration dates are only valid if ready-to-eat products have been properly stored and transported throughout the refrigerated “cold chain” from production to store shelves.

X5 Retail Group has partnered with Israeli food tech startup Evigence Sensors® on the innovative Green Dot project, which monitors product freshness through smart-sensor labels placed on the packaging. As part of this initiative, X5 will place 10 million freshness labels on items from our Smart Kitchen assortment of ready-to-eat and ready-to-cook foods, marking the largest rollout of this technology in Europe. By introducing a freshness guarantee based on an independent thermal sensor, we offer our customers a new level of transparency that boosts their trust in our products and our brand.

A Green Dot smart sensor monitors product freshness in real time, changing colour based on a combination of time and temperature conditions from the moment it is activated. This enables customers and employees to accurately understand the freshness and remaining shelf life of a particular item.

Each sensor is specially engineered to correspond to the thermotemporal parameters of the food it is applied to. The sensor changes colour if the shelf life is about to expire or in case of non-compliance with storage conditions. Before labelling, the sensor’s chemical compound is activated using special equipment. If storage, transportation or instore temperatures go above a set threshold, the product’s shelf life will expire faster than indicated on the packaging date code – and the Green Dot label will change colour accordingly. At X5, we believe that technology should be as simple and effective as possible. With the Green Dot label, people can determine the quality and freshness of a product at a glance. Evigence Sensors® was one of four winners of X5’s innovation scouting project held in July 2019 in Israel. The winners were determined by an international panel of experts in a series of face-to-face meetings with the participants. X5 received applications from around 80 startups wishing to take part in the competition. The winning startups had the opportunity to travel to Moscow to carry out an extended project presentation and proof of concept (POC) using X5 investments and infrastructure.

IVAN MELNIK

Innovations Director X5 RETAIL GROUP

Evigence technology is the most costeffective solution we have seen on the global market, and X5 has taken on the full costs of the project without passing them on to the customer. We believe that investing in customer trust is the best investment to make, and one which will pay off many times over through traffic and NPS growth.

X5 cares about building customer trust in the quality of our Kitchen Factory products, as customers pay particular attention to the freshness and storage conditions of readymade foods. With the Green Dot label, customers can continue to monitor the freshness and storage conditions of products purchased at our Perekrestok supermarkets even from their home refrigerator.

Food freshness sensors are not a completely new invention, with various types of technology already existing in Japan. However, we found that the Evigence technology meets our requirements in terms of commercial use, quality, and convenience of implementation that doesn’t disrupt our production process. In the United States, Evigence launched a similar project with McDonald’s. Technology takes time to develop and adapt to real-world conditions so that it can be used in largescale commercial settings. While it is certainly possible to develop a thermal tag in Russia, it would take significant time and investments to fine-tune it and prepare it for production at industrial scale. X5’s partnership with Evigence is an example of how retailers can work with startups to bring innovative solutions to the market quickly and efficiently. In so doing, retailers increase customer trust and satisfaction, which results in better performance for their own brand.

Ivan Melnik, Innovations Director at X5 Retail Group

Ivan Melnik has been with X5 Retail Group for 10 years. Since the beginning of 2019, he oversees the scouting and implementation of innovative solutions at X5, both in collaboration with startups and on the basis of internal R&D. Since 2017, the Innovations Department has evaluated more than 1,500 startups from Russia, China and Israel and launched more than 117 pilot projects in partnership with startups.