You don’t have to be a major player to make a difference in the digital marketplace. Engaging with your customers through your company’s website, mobile devices and social media platforms is becoming increasingly seamless and cost-effective, and the digital world can level the playing field a bit when it comes to highly sought-out local bakery brands.
Still, there are valuable lessons to be learned from the heavyweights of retailing.
According to newly released Nielsen data, key retail players like Walmart, Kroger and Target have grown their online customer base by at least 90% more than Amazon over the past two years. Amazon has much greater domestic buyer reach (10 times more than any other), according to Nielsen, so there’s not as much room to grow its buyer base. But that’s not the only reason for the rapid success of competitors.
In part, merchants have succeeded because they’ve embraced the click-and-carry model where consumers buy an item online and pick it up at a physical store, Nielsen reports. The research firm estimates that the share of click-and-carry sales grew from 4% to 11% of all consumer packaged goods (CPG) e-commerce sales in just two years. Consumers appear to enjoy this model because it gives them confidence to expand online shopping beyond health and beauty. In fact, the grocery/gourmet food category has a compound annual growth rate of nearly 50% over the past three years, according to Nielsen data.
What can independent bakeries and bakery cafe chains expect next?
The future is all about digital engagement. Explore and reinforce unique experiences to enhance customer interactions and keep your focus on building richer and higher customer counts that will last.
Panera Bread, for one, is launching an augmented reality (AR) experience on Snapchat to bring more dedicated consumers into the fold, using a highly innovative campaign in tandem with AR company Kabaq. Panera fans can scan designated Snapcodes for four of the bakery cafe chain’s new “You Mix Two” options (Southwest Chili Shake Up, Mac-Tomato Medley, Delicious Cheese Times, and Tomato Tango) and see the two menu items fused before their very eyes. The unique “You Mix Two” concept gives Panera customers eight unique menu remixes that are crowdsourced directly from the 34 million MyPanera member base. These menu hacks combine preexisting menu items in enticing and delicious ways.
Embracing “third place”
Much success in the digital age revolves around reinforcing a trusted brand. For instance, at the new starbuckstories.com, and across Starbucks associated social channels, customers can now meet coffee farmers and the agronomists working with them to create the world’s first sustainable agricultural product. Consumers hear people speak to country, togetherness, family and service. A quick tour across the top navigation guides fans to impactful stories about coffee, community and social impact.
Brand endurance requires evolving with customer’s changing needs, according to Starbucks. To that end, Roz Brewer, Americas group president and chief operating officer, recently revealed the company’s plans to reimagine the third place, with a focus on three key attributes: convenience, comfort and connection. Through this lens, Brewer will announce Starbucks will take a phased approach to modernizing the customer experience across all key touchpoints for customers, beginning this summer in New York City.
“I don’t want anyone to walk away today thinking this is about furniture or a new renovation strategy,” Brewer said during the company’s March 20 annual meeting of shareholders. “Reimagining the third place is about listening to our customers, so we can better position our business now and for the future.”
Through this approach, Starbucks aims to learn directly from its customers and adapt changes to new and better experiences using technology and product innovation, in addition to new and reimagined store formats. The company also will reiterate its commitment to the continued expansion and evolution of programs like Starbucks Delivers (now available in 12 countries) and Starbucks Rewards.
“Our relationship with our customers starts the moment they think of Starbucks. They connect with us through their barista and the quality of what’s in the cup they take with them,” Brewer said. “Their third place is everywhere they’re holding our cup. No matter their journey, after leaving our stores, that feeling of comfort stays with them. And In an increasingly busy and on-demand world, it’s that feeling that keeps the third place growing.”
At a crossroads
Scores of bakeries across the country are witnessing the multitude of opportunities ahead through digital transformation.
For example, Cake Boss” Buddy Valastro and his iconic Carlo’s Bakery are partnering with Ordrslip, a provider that allows restaurants to operate custom mobile apps, to bring a new mobile ordering app to his bakery in New York City’s Times Square. The custom application will allow Carlo’s Bakery customers to place orders in advance from their smartphones and will help the bakery to better manage rushes.
“Our Times Square location is the newest and busiest bakery within our franchise,” says Buddy Valastro Jr., owner of 19-store Carlo’s Bakery, founded in 1910 in Hoboken, New Jersey. “A branded, custom app from Ordrslip gives us the ability to keep pace with our customers’ expectations for fast service and a mobile user experience that fits their busy lifestyle.”
Others are reimaging the possibilities of making food delivery more affordable. Kitchen United, the start-up creating a new way for restaurant brands to expand via off-premise optimized kitchen centers, recently announced The Halal Guys and Wetzel’s Pretzels have established operations at the company’s Pasadena kitchen center. The company plans to end the year with 15 kitchen centers open, each housing between 10 and 20 restaurant brands that will power their delivery operations through Kitchen United.
Jennifer Schuler, chief executive officer of Wetzel’s Pretzel, credits Kitchen United for bringing a revolutionary approach to capitalizing on consumer trends toward delivery and being a place where restaurants — from start-ups to long established brands — can navigate this changing foodservice landscape, “and we’re thrilled to be a part of it.”
Kitchen United is expanding across the U.S. with kitchen centers open in Pasadena and Chicago, and new kitchen centers slated to open this year in Atlanta, Columbus, Austin and Scottsdale.
Students at Northern Arizona University (NAU) can now have Einstein Bros. Bagels delivered directly to them by a fleet of 25 self-driving robots. The program is operated by foodservice company Sodexo in partnership with Starship Technologies. Students at campuses can order autonomous food delivery from several retail partners.
Since the robots’ debut at George Mason University in late January, more than 1,500 breakfast orders have been placed.
Nearly 25,000 NAU students and faculty can use the Starship app to order food and drinks from local retailers to be delivered anywhere on campus, within minutes. Students place an order through the app, drop a pin for the delivery location and follow an interactive map to track the robot’s location as it makes its way across campus. They receive a notification when the robot arrives and can unlock the robot to retrieve their order, all through the app. Each robot can carry up to 20 pounds, or about three shopping bags of goods.
Bob Howland calls it an incredibly exciting time to serve in his new role as chief digital officer for Dawn Foods. In this newly created leadership position, Howland will play an instrumental role in engaging customers with Dawn’s digital solutions. He is responsible for developing the company’s long-term digital vision, engaging customers with digital solutions and leading its broad-reaching digital initiatives.What excites Howland, who joined Dawn earlier this year, starts with helping Dawn’s bakery customers realize the full potential of their digital journey. More consumers than ever before are engaging with their favorite shops on a “hyper local level,” and the path for bakeries is wide open.
“I’ve been doing this for more than 20 years, working in industries ranging from chocolate to home goods, and I believe it comes down to three words: people, process and technology,” says Howland, who previously served as executive vice president and general manager of Blueport Commerce, a Boston-based e-commerce platform for furniture. “The big part of this effort is the people. It is about change management, helping people know the potential for what digital could mean to their business, and understand the differences of consumer behavior. The opportunity to change tends to be very rewarding.”
In one key project announced earlier this year, Dawn is using the initial phase of its new Dawn Bakery Business Portal to test, learn and gain insights for a deeper dive into the next phase.
The Bakery Business Portal was introduced in a test phase in the Chicago market where a group of 8 to 10 retail bakeries use this portal as a virtual storefront where consumers order fresh bakery products that they pick up and pay for at the retail bakery store.
“These efforts have gone very well. A few have seen a pretty significant percentage of orders made online, and still others are working to create more,” Howland says. “At the end of June, we plan to expand the next phase to 30 to 50 bakeries, as we continue to learn more and partner more fully with Dawn customers. More deployments give us a richer understanding of who’s doing it well, what’s working and why. We are creating a community where bakers can share through Dawn, and I think that will go far.”