In Grocery Wars, searching for the Last Jedi
How blockchain could end the battles
Jedi (‘dʒɛˌdaɪ) are defined by Wikipedia as “polymaths who value wisdom and knowledge above nationality.“
More than the people who they were, they were great because of the ideals they embodied and the goods of wisdom they made accessible to the galaxies.
Wouldn’t it be nice to have an order of paramilitary galactic monks who solve the issues of the world?
One of these issues in the food world is the real challenge of bridging the gap between the demand for quality, freshness, the right price, and the desire to have it all right now. The food industry, estimated by the World Bank to be 10% of the global gross domestic product, and comprising in 2007 of 1.6 trillion USD (additionally the food service industry making up for 1.85 trillion USD), is one of the world’s most important economic platforms and one of the world’s largest personal income providers. And at least in the US, many grocer corporations and smaller businesses are shaking at their knees in the face of current developments.
Amazon announced this month that they will acquire Whole Foods Inc. This development is a clear signal to Walmart, Kroger, Aldi and company that real work is being made on delivering fresh groceries (vegetables, fruits, milk products and meat) through a highly efficient logistics system to local buyers. Nevertheless, to none of Amazon’s competitors is this news: they’ve been trying it for years without significant success.
Experience shows that what seems to trump a buyer’s decision for purchasing food – even above immediacy and delivery – is the cultural factor. Most shoppers today stem from a generation where a healthy diet is a top element of personal well-being. Obviously the price must be right, but looking at two sub-factors we might be able to determine where the magic formula for success in the grocery wars lays.
It was the job of the Jedi to protect the interests of justice and the less-fortunate in the galaxy. Let’s just say analogously that the grocery wars need a unifying principle in order to save jobs and meet the demands of upcoming generations at an affordable price. Delivery, yes. But there’s something more important.
When it comes down to the buyer’s decision, the purchasing factors containing highest risk are freshness and quality. Since freshness can be determined by inspecting a product, the biggest concern younger buyers are increasingly encountering is quality: where the food actually comes from and whether non-organic chemicals were used in the apparently fresh produce.
There is a technology that luxury brands are currently using to ensure that a consumer is purchasing the real thing. It’s blockchain. This technology can nearly infallibly track the source of a product and bring it to the buyers attention in the decision-making process. That would be an amazing advancement in the grocery shopping experience. And it would significantly mitigate the risk a buyer assumes when taking home fresh goods.
Blockchain is essentially a digital distributed ledger system that allows all parties involved in the industry, from farmers to distributors to retailers, to record their transactions safely in the blockchain cloud. It enables a new level of trustworthiness, since the data that are recorded can’t easily be changed or forged.
In November 2016, Walmart announced its intention to incorporate blockchain into its fresh produce line. They began testing at the beginning of 2017 with a packaged produce item in the US, and in China with pork. If the tests run successfully, it could be a real revolution for the entire food industry, since its implementation costs are relatively low.
It will not necessarily be the immediacy and delivery factors that determine how successful a grocer will be in the future. It’s about quality for Gen Xers and Millennials. This technology could be the missing key, the last Jedi, the securer of success in the grocery wars.