Future of Grocery by Idea Couture

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2 PHOTO CREDITS VIA UNSPLASH: CHUTTERSNAP TOA HEFTIBA KAI PILGER EMILE VICTOR

Entering a new era of grocery retail

MARIANA MEDVEDEVA NEONBRAND STACKI YU NORDWOOD THEMES CHUTTERSNAP JEFF SHELDON KALISA VEER MICHEL CATALISANO RAWPIXEL PHIFE

THE GROCERY RETAIL SECTOR IS UNDERGOING MASSIVE TRANSFORMATION AS A RESULT OF EMERGING TECHNOLOGICAL, SOCIOECONOMIC, POLITICAL, AND ECOLOGICAL CHANGE, WHICH IS IMPACTING THE WAY WE LEARN ABOUT, ACQUIRE, AND CONSUME PRODUCTS, FROM OUR DAILY STAPLES TO EXOTIC INGREDIENTS. AS THE UNIQUE WAYS IN WHICH PEOPLE ARE EXPOSED TO, EXPERIMENT WITH, AND TRY FOOD PROLIFERATE ACROSS CHANNELS AND PLATFORMS, THE SHOPPING EXPERIENCE IS BEING REIMAGINED. PEOPLE ARE LOOKING TO NEW FOOD EXPERTS AND COMMUNITIES AS THEY WORK TO REFINE THEIR CHOICES IN WAYS THAT SUIT THEIR LIFESTYLE AND VALUES. THE DIGITAL TECHNOLOGIES OF THE NOT-SO-DISTANT FUTURE—WHICH CAN BRING TO LIFE TRANSPARENT SUPPLYCHAIN MONITORING, NEW METHODS OF GROWING, AND ALTERNATIVE MODES OF DELIVERY—HAVE THE POTENTIAL TO CHANGE OUR EXPERIENCES IN THE BROADEST SENSE. THESE SMART TECHNOLOGIES WILL OPEN A WINDOW TO THE WHERE, WHO, WHAT, AND HOW OF FOOD PRODUCTION. CONSUMER DEMAND FOR SUSTAINABLY MANUFACTURED AND DELIVERED PRODUCTS IS PERMEATING ALL ASPECTS OF THE FOOD SYSTEM AND IS BEING ADDRESSED IN SUCH AREAS AS SYNTHETICALLY PRODUCED PRODUCTS, BIO-INTELLIGENT PACKAGING, AND INITIATIVES THAT SUPPORT BOTH HEALTHY AND LIVABLE COMMUNITIES AND AUTOMATION.

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IN THIS ERA OF INCREASINGLY PRECARIOUS GROWING CONDITIONS AND POPULATION GROWTH, WHAT WE CONSIDER A GROCERY RETAILER IS EVOLVING. THE WORK THAT FOLLOWS OUTLINES AREAS OF SIGNIFICANT CHANGE TO BE CONSIDERED WHEN CHARTING THE POSSIBLE FORMS GROCERY RETAIL OF THE FUTURE MAY TAKE.

3 FUTURE OF GROCERY: ENTERING A NEW ERA OF GROCERY RETAIL

GROWTH OF ECOMMERCE

MEDIA DELIVERY

FOOD DELIVERY

Digital interactions now influence 64 cents of every dollar spent in US retail stores, or $2.2T.

The US meal-kit delivery market was worth $5B USD in 2017.

– DELOIT TE (2015)

– PACKAGED FACTS (2017)

Online food delivery (Uber Eats, Just Eat) showed a CAGR of 25% from 2015 to 2018 globally. – MCKINSEY (2016)

NEW CONCEPT STORES IN STORE GROWING ENVIRONMENTS

Amazon Go opened to the public on Jan 22 th, 2018.

As of February 2018, vertical farming startup Infarm had raised $25M in Series A funding.

– BUSINESS INSIDER (2018)

– TECHCRUNCH (2018)

MEAL KIT 90% of US meal-kit subscribers would recommend the service to a friend. – PACKAGED FACTS (2017)

AI AND ANTICIPATORY MODELS By 2020, 100 million consumers will shop using augumented reality. – GARTNER (2016)

ROBOTIC SERVICES

72% of consumers state they always read the package for nutrition facts and ingredients when food shopping.

Amazon began rolling out robots to its warehouses in 2014; it now has more than 100,000 robots in action around the world, with plans to add more.

– THE HARTMAN GROUP (2015)

– THE NEW YORK TIMES (2017)

TRANSPARENCY

IOT KITCHEN AND DELIVERY

EXPERIENCE BASED CONSUMPTION

McKinsey predicts that by 2020, the IoT market will have a value of $3.7B and will comprise 20 billion devices.

78% of millennials would prefer to increase their spending on experiences rather than material objects.

In the US, 80% of Gen-Zers are more likely to visit physical stores that offer entertainment.

– McKINSEY (2016)

– J.WALTER THOMPSON INTELLIGENCE (2016)

– HARRIS GROUP (2016)

FRICTIONLESS EXPERIENCE

OMNI CHANNEL SHOPPING

There are over 140,000 self-checkout stations in the US with 91% of shoppers 35 and younger having used a self-checkout.

90% of retail shoppers report using smartphones in stores; 55% of smartphone usage in stores is related to shopping research, but only 8% of shoppers use the retailer’s app.

– STATISTIC BRAIN (2017)

– SESSION M (2015)

JR KORPA VIA UNSPLASH

5 FUTURE OF GROCERY: TABLE OF CONTENTS

Table of contents

INTRODUCTION EMERGING PATTERNS OF CHANGE 6 HOW TO READ 7

PATTERNS OF CHANGE 01. CIRCULARITY AS A BUSINESS MODEL

8.9

02. BEYOND REAL TIME SUPPLY CHAIN MONITORING

10.11

03. NIMBLE TRANSPORTATION 12.13 04. A CHANGING LABORSCAPE 14.15 05. THE MODULAR HUB 16.17 06. GROWING ON SITE 18.19 07. COMMUNITY THROUGH LIFESTYLE 20.21 08. FOOD FOR SELF OPTIMIZATION 22.23 09. NEW PRICING METRICS 24.25 10. BIO INTELLIGENT PACKAGING 26.27 11. SYNTHETIC BIOLOGY 28.29 12. EMERGING INSPIRATION AND AQUISITION CHANNELS

30.31

CONCLUSION CONCLUSION 32.33 WHO WE ARE 34.35

PAULA PREKOPOVA VIA UNSPLASH

DANE DEANER VIA UNSPLASH

Emerging patterns of change impacting the future of grocery

A FUTURE FORWARD APPROACH THE FOLLOWING IS A COLLECTION OF 12 PATTERNS OF CHANGE IMPACTING THE FUTURE OF GROCERY RETAIL. THESE EMERGING THEMATIC AREAS ARE THE RESULT OF OUR ONGOING STRATEGIC FORESIGHT PROCESS, WHICH WE USE TO CONTINUOUSLY TRACK, MAKE SENSE OF, AND COMMUNICATE CHANGE HAPPENING TODAY THAT MAY HAVE A SIGNIFICANT IMPACT ON TOMORROW. THESE THEMES ARE ANCHORED IN A DEEP UNDERSTANDING OF THE HUMAN EXPERIENCE ACROSS SEVERAL AREAS, INCLUDING THE RAPIDLY EVOLVING RETAIL LANDSCAPE, TRANSFORMATIVE AND EMERGING DIGITAL TECHNOLOGIES, AND SHIFTING SOCIOCULTURAL VALUES AND BEHAVIORS. HERE, EACH THEMATIC AREA IS CONSIDERED AS A “THOUGHT STARTER” FOR HOW THESE EMERGING PATTERNS MAY MANIFEST AS LARGER CULTURAL SHIFTS; HOW THEY MIGHT IMPACT OUR BEHAVIORS, VALUES, AND WORLDVIEWS; AND, IMPORTANTLY, HOW WE MIGHT RECOGNIZE EXISTING CHALLENGES AS FUTURE OPPORTUNITIES FOR INNOVATION ACROSS THE LARGER GROCERY RETAIL ECOSYSTEM.

How to read SIGNALS 01.Danone’s approach to resource scarcity is what the company calls a “consumption ecosystem.” It takes into account every stage in each product’s life. For example, after working with different partners to find uses for yogurt byproducts, the company began using whey protein to produce animal feed, fertilizers, and energy via their Early Life Nutrition brand.

02. Kalundborg Eco-Industrial Park in Denmark has developed an industrial ecosystem where leading companies and research institutions develop new products and technologies by exchanging biological knowledge and byproducts.

I M P L I CAT I ON S

MEHRSHAD RAJABI VIA UNSPLASH

Adopting circularity as a core business principle by capturing and harnessing waste across the supply chain has the potential to generate significant cost savings. Beyond providing economic value, circularity-based practices can empower retailers to play an active role in reducing food waste.

DEPARTURE QUESTION

CHUTTERSNAP VIA UNSPLASH

TITLE, SHIFT, DESCRIPTION Each of the 12 thematic patterns of change includes a title, a subtitle highlighting the shift from past to future, and a short description that outlines the pattern we see emerging.

SIGNALS OF CHANGE Each thematic pattern notes two signals of change. Signals are illustrative instances of the pattern at play in the real world. Each signal corresponds to an online article source that can be accessed using a QR code-scanning app on your movile device.

How might grocery retailers lead industry-wide adoption, education, and marketing of new and innovative processes to capture and repurpose waste or byproducts?

PROVOCATION What if grocery retailers of the future were to adopt principles of circularity, system-wide innovation, and advances in biotechnology in order to create entirely new products and processes for the food system?

QR CODES

Each signal is linked to a QR code that leads you to the website. Download a QR code reader and scan to view. 04

DEPARTURE QUESTION Each thematic pattern questions how today’s grocery retail is equipped for the theme’s associated challenges. A departure question is essentially a mental take-off point for divergent thinking.

IMPLICATIONS Each thematic pattern includes a consideration of its relevant impact on grocery retail.

PROVOCATION Each thematic pattern asks a future-oritneted “what if” question. This question is meant to kick-start transformation and tactical thinking by connecting the different thematic areas.

IN THE CENTERFOLD OF THIS PUBLICATION YOU WILL FIND A GRID OF THEMATIC CARDS TO KICK-START TRANSFORMATIONAL AND TACTICAL THINKING. 1. M IX/MATCH: CUT OUT AND MATCH CARDS TO CONSIDER HOW VARIOUS THEMATIC COMBINATIONS ARE INTERRELATED. 2. RECTO/VERSO: CONSIDER WHAT MIGHT HAVE TO HAPPEN FOR THE PROVOCATION QUESTIONS TO ACTUALLY TRANSPIRE. 3. WHAT OTHER IDEAS DOES THIS COMBINATORY PLAY INSPIRE?

Circularity as a Business

FROM ENVIRONMENTAL MOVEMENT TO ECONOMIC IMPERATIVE AS ENVIRONMENTALISM MATURES FROM A MOVEMENT INTO AN ECONOMIC IMPERATIVE, THE CIRCULAR ECONOMY MODEL AIMS TO ALIGN SUSTAINABILITY AND PROFITABILITY. CIRCULARITY FOCUSES ON MINIMIZING INPUTS, EMISSIONS, AND WASTE BY RECIRCULATING AND REGENERATING INPUTS WHILE ENCOURAGING SYSTEM-WIDE INNOVATION AND MUTUALLY BENEFICIAL SHARING NETWORKS.

9 FUTURE OF GROCERY: CIRCULARITY AS A BUSINESS MODEL

SIGNALS 01. Danone’s approach to resource scarcity is what the company calls a “consumption ecosystem.” It takes into account every stage in each product’s life. For example, after working with different partners to find uses for yogurt byproducts, the company began using whey protein to produce animal feed, fertilizers, and energy via their Early Life Nutrition brand. 02. Kalundborg Eco-Industrial Park in Denmark has developed an industrial ecosystem where leading companies and research institutions develop new products and technologies by exchanging biological knowledge and byproducts.

IMPLICATIONS

MEHRSHAD RAJABI VIA UNSPLASH

DEPARTURE QUESTION

CHUTTERSNAP VIA UNSPLASH

How might grocery retailers lead industry-wide adoption, education, and marketing of new and innovative processes to capture and repurpose waste or byproducts?

Beyond Real Time Supply Chain

FROM SLOW AND OPAQUE TO REAL-TIME TRANSPARENCY THE MODERN SUPPLY CHAIN IS QUICKLY BEING DIGITIZED ACROSS ALL CRITICAL JUNCTURES. EMPLOYING INTERNET OF THINGS (IOT) AND BLOCKCHAIN TECHNOLOGIES, PRODUCERS, DISTRIBUTORS, AND CONSUMERS CAN OBTAIN REAL-TIME DATA AND INSIGHTS FROM ACROSS THE SUPPLY CHAIN.

11 FUTURE OF GROCERY: BEYOND REAL-TIME SUPPLY CHAIN

SIGNALS 01. PrecisionHawk began as one of the first commercial drone companies to focus on using agricultural aerial data to improve crop health by evaluating crop status, detecting and tracking plant disease, evaluating planting, establishing replanting requirements, completing temperature profiling, and more.

02. Walmart, IBM, and Tsinghua University in Beijing have partnered to put Chinese pork on a blockchain to improve food traceability by tracking information about farm origination, batch numbers, factory and processing data, expiration dates, storage temperatures, and shipping details.

IMPLICATIONS With access to real-time supply chain information, grocery retailers can now leverage an entirely new dataset to ensure the best product allocations, thereby maximizing shelf life, variety, and quality.

How can grocery retailers communicate meaningful real-time product information to their customers?

PROVOCATION What if grocery retailers of the future were to dynamically price goods according to strategies for circularity, like recirculating byproducts from a network of suppliers?

MAX DELSID VIA UNSPLASH

DEPARTURE QUESTION

Nimble Transportation

FROM BULK SHIPMENT TO MULTI-MODAL DELIVERY AS THE COMBUSTION ENGINE IS PHASED OUT, NEW FORMS OF TRANSPORTATION AND DELIVERY—INCLUDING AUTONOMOUS VEHICLES, ELECTRIC VEHICLES, AND DRONES—COUPLED WITH SOPHISTICATED LOGISTICS MANAGEMENT ARE FUNDAMENTALLY ALTERING THE WAYS IN WHICH GROCERY IS MOVED.

13 FUTURE OF GROCERY: NIMBLE TRANSPORTATION

JARED BRASHIE VIA UNSPLASH

SIGNALS 01. HorizonX, Boeingâ&#x20AC;&#x2122;s research arm, has announced an autonomous air cargo drone capable of transporting payloads of 500 lbs. This technology would enable rapid air cargo logistics and shipping anywhere throughout the supply chain. 02. US startup Gomango has created a modular refrigerated shipping container that can be used for small-batch shipments (less than a truckload) of fresh products from small-scale producers.

IMPLICATIONS New delivery modes, many of which operate without the constraints of traditional road infrastructure, open grocery retailers up to new markets and offerings. Small-batch, demandbased delivery can reduce inventory and spoilage while offering fresher and more personalized options.

DEPARTURE QUESTION How can grocery retailers reinvent their offerings through shorter and faster supply chains to maximize efficiency and transportation spend while providing fresher and more diverse selections of products?

PROVOCATION What if grocery retailers of the future were to grow food in the same modular units used to deliver it?

A Changing Laborscape

FROM STRUCTURED TO UNCERTAIN OUR DEFINITION OF WORK IS NO LONGER UNDERSTOOD AND PERFORMED AS IT ONCE WAS. THE SHIFT TO AN IMPERMANENT “GIG ECONOMY,” COMBINED WITH GLOBAL MIGRATION, CLIMATE CHANGE, AUTOMATION, AND DEMAND FOR SUSTAINABILITY, HAVE MADE THE TASK OF DEFINING A HEALTHY WORKFORCE IN THE 21ST CENTURY INCREASINGLY COMPLEX.

15 FUTURE OF GROCERY: A CHANGING LABORSCAPE

SIGNALS 01. Coworker.org is a platform that helps workers in the gig economy or employees of non-unionized employers organize change. Successful campaigns include Uber drivers advocating for the right to receive tips and Netflixâ&#x20AC;&#x2122;s hourly employees gaining access to extended paid parental leave.

IRINA VIA UNSPLASH

02. Some organizations, like Silverado Farming Company in California, are providing labor benefits like health insurance, subsidized housing, profit sharing, and even language classes as incentive for workers to stay in the fields.

IMPLICATIONS As the retail labor force becomes more fragmented, retailers must thoughtfully balance cost-saving investments in automation with competitive employee incentives that minimize costs of turnover and motivate people to complete exceptional work.

EMIL VILSEK VIA UNSPLASH

DEPARTURE QUESTION How can grocery retailers cultivate a socially sustainable workforce and maximize the potential of automation?

PROVOCATION What if grocery retailers of the future were to make social sustainability a transparent pricing factor?

The Modular Hub

FROM INVENTORY STORAGE TO EVOLVING EXPERIENCES IN THE “AGE OF AMAZON,” BRICK-AND-MORTAR RETAILERS ARE MAKING THE MOST OF WHAT ONLINE STORES CAN’T: SPACE. PHYSICAL SPACE IS BEING RECONSIDERED AS A HUB FOR EVOLVING PRODUCT OFFERINGS AND CURATED EXPERIENCES IN PLACE OF STATIC DISPLAYS, AISLES, AND DEPARTMENTS.

17 FUTURE OF GROCERY: THE STORE AS A MODULAR HUB

SIGNALS 01. Canal Street Market in New York City is a 12,000 square foot creative outlet that prioritizes discovery and stories, combining an ever-evolving food hall, a curated retail market, and a rotating residency of local designers.

CLEM ONOJEGHUO VIA UNSPLASH

02. Saks Fifth Avenue is prototyping a “Wellery”—an ad hoc assortment of unusual new-age remedies and upscale fitness products. The Saks Wellery features multiple kiosks, including an avocado juice bar, a salt room, and non-invasive bodycontouring processes. It also hosts group fitness classes taught by exconvicts and offers vegan non-toxic nail treatments.

IMPLICATIONS As sociocultural trends continue to emerge, blend, and change at a rapid pace, it will be important for brands and retailers to stay ahead of evolving customer values. Spaces that are designed to be flexible, multipurpose, and modular can allow retail spaces to keep up with relevant trends while enabling people to touch, feel, and smell products and experiences.

DEPARTURE QUESTION In an era where data is being used to understand trends and even design products and services, how can retailers anticipate and provide meaningful in-person experiences?

PROVOCATION What if grocery retailers of the future were to use data to become a testing ground and showroom for food innovation?

Growing On Site

FROM LONG DISTANCE TRAVEL TO IN-SITU PRODUCTION BEYOND FARM TO TABLE, RESTAURANTS, GROCERY RETAILERS, AND CONSUMERS ARE SETTING UP ON-SITE FARMING PRACTICES AND COLLAPSING THE DISTANCE BETWEEN CONSUMERS AND A VARIETY OF HYPER-FRESH PRODUCTS.

19 FUTURE OF GROCERY: GROWING ON-SITE

SIGNALS 01. Berlin-based startup Infarm has partnered with Germany’s largest supermarket corporation, Edeka. Infarm designs modular vertical farming systems for people to pick produce themselves in grocery stores, restaurants, and schools. Plants are monitored by sensors and fed by a cloud-controlled irrigation and nutrition system. 02. Livin Farms, the world’s first at-home hive for edible insects, is a table-top insect breeding farm that allows people to produce 200–500 g of protein-rich, edible mealworms.

IMPLICATIONS EMILE VICTOR PORTENART VIA UNSPLASH

As urban centers embrace initiatives that collapse distance between where food is grown, harvested, and consumed, supply and distribution constraints for some of the most fresh and artisanal products can be significantly minimized.

DEPARTURE QUESTION How can grocery retailers grow food onsite while also providing food education and even deeper supply chain transparency?

PROVOCATION What if grocery retailers of the future allowed people to pick, prepare, and enjoy food in one place?

Community through Lifestyle

FROM INDIVIDUALS TO TOGETHERNESS AS LIFESTYLE PRODUCTS AND INTERESTS PROLIFERATE AND EVOLVE, PEOPLE OF ALL AGES ARE INCREASINGLY CONNECTING TO DIVERSE GROUPS, ONLINE AND OFF, FOR COMMUNITY PARTICIPATION, LIFESTYLE ADVICE, AND EDUCATION.

21 FUTURE OF GROCERY: COMMUNITY THROUGH LIFESTYLE

SIGNALS

EATERS COLLECTIVE VIA UNSPLASH

01. The rise of social media influencers, like those surrounding the Whole30 diet, has fundamentally altered how we seek advice. Instead of seeking out health and lifestyle advice from friends, family, or professionals, fellow dieters are often found interacting with influencers and thought leaders directly through social media. In turn, influencers directly share diet tips and recipes, and they also connect consumers to paid-partnership channels. 02. Borne out of the cult following of world-renowned restaurant Noma, food foundation VILD MAD has partnered with the Danish school system to launch a pilot program, enabled by an app and website, that teaches children to forage and participate in events to share stories, learn, and interact with fellow foragers.

IMPLICATIONS

ANNIE SPRATT VIA UNSPLASH

Countless cultural and interestbased lifestyle groups are forming communities online and off, eschewing classical membership prerequisites and segmentation classifications like physical proximity and socioeconomic class. In doing so, theyâ&#x20AC;&#x2122;re creating new ways for food retailers to understand togetherness and to address people and their interests.

DEPARTURE QUESTION How can retail brands encourage, foster, and participate in new lifestyle communities on and offline, creating shared experiences, access to community leaders, word-of-mouth referrals, and collaborative learning experiences to increase brandâ&#x20AC;&#x201C;consumer loyalty and engagement?

PROVOCATION What if grocery retailers of the future partnered with emerging communities to understand microtrends and new lifestyle habits?

Food for Self Optimization

FROM FOOD AS FUEL TO PERSONAL MEDICINE AS SCIENTIFIC ADVANCES ENABLE US TO BETTER UNDERSTAND THE EFFECTS VARIOUS FOODS HAVE ON OUR BODIES, WE ARE INCREASINGLY CONSIDERING FOOD AS A TOOL FOR OPTIMIZING OUR HEALTH AND WELLBEING.

23 FUTURE OF GROCERY: FOOD AS SELF-OPTIMIZATION

SIGNALS 01. AIRE by FoodMarble is a handheld hydrogen breath-testing tool used to analyze the body’s reactions to different foods. The AIRE then uses this information to make dietary recommendations suited to the user’s microbiome. 02. Nutrigenomix is a University of Toronto biotechnology startup dedicated to providing dieticians and their clients with comprehensive genomic information to improve health through personalized nutritionbased genetic profiles.

IMPLICATIONS Today’s aisle of nutritional supplements will undoubtedly feel like a one-size-fits-all approach when considered beside advanced options for personalized food medicine. As consumers seek out increasingly specific and complex options that enable them to live their best life, grocery retailers will be expected to keep up.

DEPARTURE QUESTION How can grocery retailers leverage valuable insights from personalized diet and nutrition data to provide new offerings?

PROVOCATION What if grocery retailers of the future could leverage insights across channels to recommend optimized health options?

New Pricing Metrics

FROM UNIFORM TO DYNAMIC METRICS LIKE CUSTOMER SENTIMENT AND WILLINGNESS TO PURCHASE ARE BEING APPLIED TO DYNAMICALLY PRICE PRODUCTS AND SERVICES, RESULTING IN AN ENTIRELY NEW WAY OF DETERMINING AND EXCHANGING VALUE.

25 FUTURE OF GROCERY: NEW PRICING METRICS

SIGNALS 01. Wasteless, a UK-based startup, offers digital shelf labeling that reacts to 43 different pricing variables (holidays, time of day, demand, inventory, etc.), enabling a number of different actions, from predictive markdowns to customized sales for individual customer groups. 02. Uber explained its new “route-based” pricing system as an attempt to address disparity between rider fares and driver pay by charging customers based on their willingness to pay a higher price for a particular route at a certain time of day.

IMPLICATIONS

PETER BOND VIA UNSPLASH

Dynamic pricing has the potential to revolutionize the retail sector just as it did the airline industry. Grocery retailers will soon be able to accurately forecast consumers’ willingness to pay; instantly match discounts offered by competitors; and offer tailored promotions based on a host of factors, from buying behavior to dietary concerns.

DENYS NEVOZHAI VIA UNSPLASH

DEPARTURE QUESTION How might grocery retailers address collective relationships between food, consumer sentiments, and quality expectations to determine pricing?

PROVOCATION What if grocery retailers of the future were to link dynamic-pricing algorithms to real-time supply chains?

Bio intelligent Packaging

FROM PASSIVELY DAMAGING TO ACTIVELY BENEFICIAL INNOVATIONS IN MATERIAL SCIENCE AND TECHNOLOGY, COUPLED WITH CONSUMER DEMAND, ARE TRIGGERING A TURBULENT EVOLUTION IN FOOD PACKAGING. NEW METHODS OF PACKAGING, INCLUDING THE USE OF ACTIVE AGENTS THAT ARE RELEASED INTO PRODUCTS OVER TIME, EDIBLE FILMS, AND BIODEGRADABLES, ARE CHANGING THE LANDSCAPE IN AN ATTEMPT TO ENHANCE SAFETY, QUALITY, AND HEALTH.

27 FUTURE OF GROCERY: BIO-INTELLIGENT PACKAGING

SIGNALS 01. A number of major food and beverage companies like NestlĂŠ, Kraft, Heinz, and Unilever are exploring nanotechnology and producing packaging materials intended to extend the shelf life and improve the safety of food and beverages. 02. Biomedical engineers at Tufts University have demonstrated that fruits can stay fresh for more than a week without refrigeration if they are coated in a naturally derived, near-invisible, odorless, waterbased silk solution.

IMPLICATIONS The global food industry is under rising pressure to meet the demand for safe, healthy, and fresh food. Food retailers will be met with options to reduce packaging and food waste, extend and communicate expiration, and increase food safety and health benefits through the release of preservatives, antimicrobials, or increased nutrients.

How might grocery retailers lead the industry in applying smart packaging to eliminate waste and actively increase the nutritional profile of fresh products?

PROVOCATION What if grocery retailers of the future could make intelligent product packaging for individual health goals?

JARON NIX VIA UNSPLASH

DEPARTURE QUESTION

Synthetic Biology

FROM AGRARIAN TO SYNTHETIC AS ISSUES WITH THE FOOD SYSTEM BECOME CAUSE FOR MORE CRITICAL ACTION, ADVANCES IN SYNTHETIC BIOLOGY FOR THE DEVELOPMENT OF FOOD PRODUCTS AND STABLE GROWING ENVIRONMENTS WILL INCREASINGLY CHALLENGE WHAT WE DEFINE AS FOOD AND HOW ITâ&#x20AC;&#x2122;S GROWN.

29 FUTURE OF GROCERY: SYNTHETIC BIOLOGY

SIGNALS

01. A team at the Institute for Sustainable Agriculture in Cรณrdoba, Spain has used CRISPR gene editing to get rid of wheat gliadins, the gluten protein group responsible for most immune responses for those with celiac disease. 02. Ginkgo Bioworks custom designs organisms to manufacture cultured rose extract for perfumes, microbes that reduce greenhouse gases, probiotic bacteria, and more. The company has recently partnered with Bayer to create a first-of-its-kind crop capable of fertilizing itself.

IMPLICATIONS Pressures to feed a growing population have pushed current industrial food production processes to their ethical and sustainable limits. Grocery retailers can now play an active role in shaping how society engages with future foods. By educating consumers on the diverse range of new products available and democratizing access to some of the most exciting food innovations, retailers can be an integral part of the future of food.

DEPARTURE QUESTION How will future grocery retailers keep up with synthetic food innovation, demand, safety, positioning, and merchandising?

PROVOCATION What if grocery retailers of the future were considered the go-to resource for synthetic food education and/or production?

Emerging Inspiration and Acquisition Channels

FROM SINGLE TO OMNI-CHANNEL TECHNOLOGY IS ENABLING A HOST OF NEW CHANNELS THROUGH WHICH CONSUMERS CAN NOW EXPERIENCE AND PROCURE FOOD. THE GROCERY RETAILER NO LONGER OWNS THE MAJORITY OF CUSTOMERS’ FOOD DOLLARS; RETAILERS MUST COMPETE WITH NON-TRADITIONAL CHANNELS ENABLED BY E-COMMERCE AND TECHNOLOGIES LIKE VIRTUAL REALITY (VR) FOR A SHARE OF CUSTOMERS’ SPENDING.

31 FUTURE OF GROCERY: EMERGING INSPIRATION AND ACQUISITION CHA N N E L S

SIGNALS 01. MUNCHIES, a website and digital video channel by VICE, produces YouTube cooking videos with celebrity chefs, showcasing interesting ingredients and making them approachable to the novice chef. After each video ends, users can opt to purchase or subscribe to the meal kit directly through a link in the video.

TOA HEFTIBA VIA UNSPLASH

02. Project Nourished allows people to create their own gastronomical tasting experience with new substances and combinations by merging the physicality of molecular gastronomy with VR. Participants can “eat” in the setting of their choice— whether real or imagined—without any concern for caloric intake or other health-related issues.

IMPLICATIONS Consumers are increasingly finding sources of food inspiration beyond the grocery store. Empowered by a host of new access channels with added convenience, product selection, and opportunities for experience, customers can circumvent the grocery retailer entirely.

DEPARTURE QUESTION How can grocery retailers leverage various technology platforms to rethink how customers experience and interact with food?

PROVOCATION What if grocery retailers of the future partnered with influencers for cross-channel tasting experiences?

ICONS8 TEAM VIA UNSPLASH

Conclusion

WHAT THIS MEANS THE FUTURE OF GROCERY RETAIL SITS AT A MOMENT OF EXCITING POSSIBILITY. FOOD AND PRODUCTS WILL COME FROM NEW AND DIVERSE LOCATIONS AND SOURCES, CREATING THE NEED FOR EQUALLY INNOVATIVE DISTRIBUTION MODES AND APPROACHES TO LOGISTICS, TRANSPARENCY, AND CONSUMER EDUCATION. THE POSSIBILITIES FOR AUTOMATION AT VARIOUS MOMENTS ACROSS THE GROCERY RETAIL SYSTEM ARE MANY. AS THE GROCERY INDUSTRY UNDERGOES THE SHIFT TO MORE FLEXIBLE BUT ALSO UNCERTAIN WORK ENVIRONMENTS, RETAILERS WILL BE PROMPTED TO ASK HOW BEST TO LEVERAGE THE SKILLS AND CAPACITIES OF THEIR EMPLOYEES. A JUST-IN-TIME MENTALITY APPLIES NOT ONLY TO PRODUCE, BUT ALSO TO PEOPLE.

How will grocery retailers provide relevant experiences for increasingly conscious and diverse customers and employees?

How will grocery retailers find insight in the large amounts of data that will be available within this connected system?

REZEL APACIONADO VIA UNSPLASH

CHUTTERSNAP VIA UNSPLASH

How will grocery retailers create products and experiences that are more personalized but that also understand emerging community and lifestyle values?

PATRICK TOMASSO VIA UNSPLASH

BY UNDERSTANDING THE PATTERNS OF CHANGE EXPLORED HERE, GROCERY RETAILERS CAN TAKE A HOLISTIC APPROACH TO THEIR POSITION AS PURVEYORS OF SOCIETYâ&#x20AC;&#x2122;S MOST ESSENTIAL SOURCE OF HEALTH AND HAPPINESS: FOOD.

ALESSIO LIN VIA UNSPLASH

FUTURE OF GROCERY: CONCLUSION

Who we are

COGNIZANT INTERACTIVE IS A DIGITAL BOUTIQUE WITH GLOBAL SCALE DELIVERING WORLD CLASS EXPERIENCES FOR OUR CLIENTS. FROM FORESIGHT SERVICES AND EXPERIENCE DESIGN, TO RUNNING SOME OF THE LARGEST DIGITAL SUPPORT SERVICES OF THEIR KIND, WE HELP OUR CLIENTS ENVISION AND OPERATE TOMORROW’S PRODUCTS AND SERVICES TODAY. WE ARE INDUSTRYFOCUSED SPECIALIZING IN APPLIED INNOVATION—PLATFORMENABLED, AI-DRIVEN, AND INSPIRED BY HUMAN INSIGHT. OUR BESPOKE SERVICES, LEVERAGING AN INTERNATIONAL NETWORK OF DIGITAL EXPERTS ACROSS 52 OFFICES, ALLOW US TO DELIVER BOUTIQUE SERVICE AT GLOBAL SCALE.

IDEA COUTURE IS AN AWARD-WINNING GLOBAL STRATEGIC INNOVATION AND EXPERIENCE DESIGN FIRM. WE USE DESIGN THINKING METHODOLOGIES TO HELP LEADING COMPANIES ENVISION AND CREATE DIFFERENTIATING BREAKTHROUGH PRODUCTS, SERVICES AND PROGRAMS THAT FULFILL CLIENT REQUIREMENTS, BUILD LASTING EMOTIONAL CONNECTIONS BETWEEN CUSTOMERS AND BRANDS AND DRIVE NEW REVENUE. WE OPERATE WHERE DESIGN MEETS BUSINESS, INSIGHT MEETS FORESIGHT AND EMPATHY MEETS ECONOMICS. THE TRANSFORMATIVE SOLUTIONS WE PROVIDE OUR CLIENTS ARE FROM BOTH MULTIDISCIPLINARY THINKING, RIGOROUS RESEARCH AND OUR TEAMS EMPLOY AN ADAPTIVE, HOLISTIC AND HUMAN CENTERED APPROACH TO THE DEVELOPMENT OF EXPERIENCES.

35 FUTURE OF GROCERY: WHO WE ARE

A CURATED SET OF REDEFINED INNOVATION TOOLS

ENTERPRISE VIEW OF THE FUTURE

PRODUCT DESIGN

HORIZON SCANNING

DESIGN

SCENARIO DEVELOPMENT

PROTOTYPING

GROWTH-PLATFORM DEVELOPMENT

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