Considering the recent accelerated digitization of the world around us, it isn’t difficult to understand why retailers everywhere are exploring and implementing an array of different technologies in efforts to enhance their digital offering. It’s investment that’s happening across all segments and verticals within the industry, resulting in a bit of a helter-skelter scramble to find and leverage the latest innovation. However, for those that were savvy enough to get ahead of the digital curve, circumstances over the course of the last couple of years have proven to be ideal for the advancement and growth of their businesses. In fact, according to John Douang, Co-Founder and CEO of Aisle 24 – the bourgeoning automated grocery market – the past 24 months have provided digitally-adept businesses with the opportunity to hone and refine their offering to customers even further.
“The shift in consumer behaviour that’s occurred over the course of the past couple of years is amazing,” he recognizes. “The rise in ecommerce adoption and sales has been dramatic. However, it’s not the only way in which behaviour has been impacted. The accelerated digitization of everything around us has made most people more accustomed to the use of digital tools and other technologies, introducing some to their use for the very first time. Now, it’s almost an expectation of consumers that there will be some sort of technology to interface with on their shopping journey, whether online or in-store, in order to make their experience easier, faster, more convenient and efficient. It puts pressure on retailers to explore and implement technologies that can meet those rising expectations. But, it’s also a circumstance that allows those that have already been experimenting with the capabilities of digital technology to experiment further and understand better how it can best support the customer experience.”
A technology-enabled experience
Founded in 2016, Aisle 24 is a fully self-service, automated, cashier-less grocery market meant to meet the convenience and time-starved lifestyle of today’s evolving consumer. Located primarily in residential communities, condos, apartments, and campuses in Ontario and Quebec, the Aisle 24 offering is truly unlike any other. Leveraging cutting edge technology, the grocer has been finding success by providing consumers with a fast and efficient experience that’s also safe and secure. And, with a focus on limiting friction for the end-user, the service is also easy to use. Consumers simply download the Aisle 24 mobile app and register an account to gain access right away. The Aisle 24 app enables members to unlock the door and start browsing. Then, once they’ve selected the items they want to buy, they simply scan them at an in-store kiosk and pay for their purchase using either their mobile wallet, debit or credit card. Although still in its infancy, it’s a concept that seems to be paving the way toward the future of the Canadian grocery experience. And, it’s one, admits Douang, that required a little bit of time to develop.
“Creating an inviting and pleasurable environment for people to shop in was extremely important to us,” says Douang. “However, it was equally important to make sure that the environment is safe and secure without compromising the integrity of the experience for the customer. It’s something that we had been working on for quite some time. And, of course, we leveraged some innovative technologies to help us achieve this. With an unmanned store, anything can happen, like spills and product breakage. To monitor for these types of occurrences, and others, our stores are equipped with cameras that are much smarter and more intuitive than standard security cameras. They’re powered by artificial intelligence that we’ve customized specifically for the Aisle 24 environment to ensure monitoring, safety and security. And, our customized system can alert our store operators of any concerns as they happen.”
The power of data
Douang goes on to explain that the store’s digital camera system also helps to generate invaluable analytics that empower and enable their franchisee store operators with the right tools and information necessary to run a successful location. It allows them a real-time view into transactional data and information concerning the days and times that customers shop with them, and more. It’s access to information that he says is critical in succeeding with this type of innovative retail concept. And, he adds that he and his team are constantly working to enhance the technological capabilities that support and benefit the Aisle 24 customer and operator experience to further differentiate their offering from competitors.
“Running an unmanned store presents both challenges and opportunities when it comes to successfully operating it,” he says. “Uncertainty and turbulence around labour issues, like shortages of talent that have arisen since the start of the pandemic, are avoided altogether. As a result, the cost of the labour is removed from this equation. However, without staff in the store, it presents challenges around customer engagement and ensuring that their needs are being met and surpassed. But, with the right technologies and focus, we’re actually able to hyper-personalize our offering to customers. Data analytics allow us to work with store operators to assess in real-time whether or not a particular product sku is working and understand the adjustments that need to be made in order to provide what customers want. In addition, we leverage our digital channels in order to elicit feedback from our customer-base in order to consistently tweak the product offering and experience that we provide for them.”
An evolving concept
It’s an experience, says Douang, that is inline with the evolving expectations of today’s Canadian consumer. And those expectations, he says, are elevating exponentially within an environment that continues to become increasingly technology-enabled. To meet them, the Aisle 24 team are always working on enhancements to its mobile app and in-store experience, providing things like personalized promotions and offers, creating what Douang refers to as a “meld between ecommerce and physical retail” whereby technology serves as the binding influence and middle layer. The focus and dedicated work that’s been put in by Douang and his team seems to have paid off to this point as they plan for major domestic expansion over the course of the next six months or so, becoming operational in British Columbia, Alberta, Ontario, Quebec and Nova Scotia by the end of the year. It’s growth that Douang’s obviously excited about. But, the real excitement and opportunity, he admits, is around a brand-new concept store that the brand will be launching soon.
“We’re working on a really exciting project right now that involves a concept store in Goose Bay, Labrador,” he says. “It’s going to be about two-and-a-half to three times the size of our average store at around four or five thousand square feet. And, what’s unique about this concept is that we’re going to be operating it as a hybrid model with hours during which the store is staffed and available to the public and hours when the store is only accessible to members. This allows us to sell age-restricted product, including alcohol, tobacco and lottery, and to address markets that are more rural, outside of the urban cores. It’s something that we’ve been trying to figure out for some time. And I believe that we’ve built an offering that will prove that these types of hybrid models can work for large format stores, allowing us to ultimately operate everywhere within the country, including more remote places that may not have the same kind of access to the conveniences and product as larger urban centres.”
Continued growth and expansion
It’s success and growth that have caught the attention of some of Aisle 24’s competitors as they watch on with curiosity at the evolution of this potentially revolutionary concept. In fact, Douang and his team have already been involved in several conversations with Sobeys at the national level, including meetings with the grocer’s innovations team. And, Aisle 24 have developed a mutually beneficial relationship with Sobeys Wholesale which includes a pricing agreement that allows the company to see out its commitment to enter rural markets, offering residents increased conveniences at prices that are competitive with other grocery entities in their areas. If all goes well over the course of the next six months or so, Douang believes that the opportunities available to the company and its franchisee operators are nearly limitless.
“Toronto and the surrounding GTA is obviously our primary market. However, over the next little while, you’re going to see Aisle 24 locations popping up in multiple markets right across the country. It’s going to translate into a ton of growth and opportunity for us and our franchisees. And, as we continue to densify these markets, it’s going to result in increased convenience and offering for our customer-base. In the meantime, we have some exciting prime locations opening soon, including Liberty Village in Toronto and inclusion within the community master plans for The Prestige at 1 Yonge Street which is the old Toronto Star building. We’re looking forward to the near-term as we, together with our franchisee operators, continue to evolve and enhance the Aisle 24 experience with the goal of opening several hundred stores over the next several years.”