Google and the Future of Grocery Shopping

Albertsons Cos. and Google recently revealed a multiyear partnership with the goal of making shopping easier and more convenient for millions of customers across the country, merging the Boise, Idaho-based grocer’s broad reach and retail know-how with the tech company’s capacity for customer-centric disruptive innovation.

Under the partnership, the two companies are introducing several new enhancements that aim to make the shopping experience easier and more exciting. Among the planned innovations: shoppable maps with dynamic hyperlocal features, artificial intelligence (AI)-powered conversational commerce, and predictive grocery list building via Google Cloud. Shortly before this rollout, Albertsons had adopted Google’s Business Messages, a conversational messaging solution, to help people obtain the latest information on COVID-19 vaccines at the grocer’s pharmacies. 

To find out more about Google’s vision of omnichannel grocery shopping, Progressive Grocer connected with Carrie Tharp, VP of retail and consumer, Google Cloud at Mountain View, Calif.-based Google. 

Progressive Grocer: Would you be able to tell us how the partnership with Albertsons came about? The two companies had already been collaborating behind the scenes for about a year before making this announcement.

Carrie Tharp: Google has deep relationships and multiyear partnerships with retailers like Albertsons through our ads and shopping organizations. In this case, we were engaging with Albertsons as a new leadership team was coming into play, and saying, “Let’s sit and understand strategically where you want to go from a customer experience and innovation perspective, and then let’s bring the best of Google to you. How can we use cloud and our data platforms as a way to create this integration and innovation?” We came from [a mindset of] “What are your business and strategic objectives, and then how do we leverage our different offerings to help make that happen?”

PG: What would these tech improvements mean for the customer? How will online or in-store shoppers at Albertsons experience these innovations?

CT: The pandemic accelerated the customer focus to hyperlocal. When we look at Google Search trends from last year, consumer searches for specific items in stock increased 8,000% in the U.S., searches just for in-stock items went up 700%, and curbside went up 3,000%. Doing things like using local actions and providing curbside pickup delivery information in mobile search is reducing the friction in the customer journey, making it easier to get information and understand what the delivery or pickup windows are.

Prior to the pandemic, it was a clunky process to find information about pickup options on a retailer’s website, for example, going to Albertsons’ website directly or through a Google search. A lot of times, people are doing their searching in mobile instead of on desktop, or they may even be outside the store. We’re making sure that the path to getting a product is smooth, whether you’re wanting to do that in-store or online.

PG: Is natural-language processing (NLP) at the point where a retailer will be able to reliably fill orders entered by voice? What pilot programs has Google done in relation to this technology?

CT: Where we’re evolving to is true conversational commerce. We’re already piloting with several large grocers alongside the Google Assistant team, leveraging NLP capabilities that are integrated with Google systems, and we’re seeing good results. From a cloud perspective, we’re now looking at using that capability, which is a combination of several AI components.

Google Search for Retail, which is essentially Google Search directly on the retailer’s website, allows retailers to interact with the customer and solve the shopping journey. It’s beyond just processing what the person said, but also the intent. For example, it’s similar to in Google Search, when it types ahead and understands what you’re looking for, but then translates that to product search and using our recommendations [via] AI to actually then say, whether you’ve searched by brand or you searched generically, “I need eggs.” This creates an integrated experience that can provide product substitutes, understand previous orders and understand what type of shopping it was before. That’s very, very important to all retailers. So we are now right at that tipping point where I think you’re going to see a lot of grocers [adopting this technology].

This is a top conversation I have globally with our grocery customers, because grocery is one of the hardest baskets to build behind versus the other retail set verticals. We are working to create this functionality and offer such a good experience that it does begin to take over more search behavior online. It’s an exciting time for us, where the capability has really gotten to a point where it becomes true conversational commerce.

PG: Besides the customer-facing applications, are there other uses for this type of technology, like in supply chain or operations, and what are you doing in those areas?

CT: Absolutely. Some of these different components I just discussed we use live with other retailers in store operations chatbots. These help the store team understand what tasks they should be doing next, and in what order. That includes helping with pick, pack and ship from store, which is very important. You have this big inflow of orders, but how do you efficiently make your way through the store, divide up those orders to get them filled and do that in a timely manner? During the pandemic, a lot of posts were getting by with reports manually in stores. Now, we’re really looking to AI to help with the efficiency of operations, so it doesn’t become overwhelming to the store environment or the store employees.

Also, from a supply chain perspective, we are working on a variety of solutions using all of these products that we’re talking about that are founded on data. There’s been a big focus on inventory visibility and providing a better view into the supply chain. Better replenishment is specifically an issue that we see not just for grocery,  but all of retail concept verticals, and bringing that data to the forefront. It’s more predictive and creates more of an agile supply chain. In the past, people had concentrated on more frequent inventories in the stores, and sometimes we can step in with AI and data and offer an insights-driven approach that can help narrow the gap on issues that retailers are experiencing in stores today.

PG: Can you give me an idea of any future innovations that are coming down the road, either with Albertsons or any other retailers that you happen to be working with?

CT: We’re looking at inventory optimizations; we’re working on early proofs of concept for how to have the right product in the right place at the right time, using AI to improve performances. Another big one for our grocers is logistics optimizations, especially the last-mile fulfillment and delivery experience. As you know, many of our grocers say that customers have gone to placing an order today for tomorrow to placing it today for today within 30 minutes. How do you really optimize your operations as a grocer to make that feasible for you?

When you think about Albertsons specifically, they’re very focused on elevating and evolving their customer experience, removing that friction in the journey. We expect future innovation [at Albertsons] to include things like conversational commerce, predicted shopping lists, or being able to fill that list and the shopping cart more easily. There’s a set list that the team is working on, but the partnership also conveys that we’re evolving as we go and building more advanced experiences.

Pandemic-Driven Shopping Trends