After decades of establishing premium grocery stores across Canada, Loblaws Inc. is finally giving shoppers what they really wanted all along – getting groceries while wearing their pyjamas.
The Brampton, Ont.-based supermarket chain, which can partly thank its six-year-old ecommerce division, Loblaw Digital, for helping its annual revenue grow from approximately $31.6 billion in 2012 to $46.7 billion last year, has won the 2018 ITWC Digital Transformation Award in the Large Private Sector Business Transformation category.
The division’s secret, Loblaw Digital senior vice president of digital and ecommerce Jeremy Pee tells ITBusiness.ca, is that it essentially functions like an in-house startup with enterprise-level resources.
“When we started this journey five and a half years ago… we didn’t sell anything online,” he says. “But with our history as one of Canada’s most beloved retailers, we knew our customer base well enough to know there was a strong appetite to engage with us across all channels. And that was the challenge at hand – how could we meet the needs that our customers wanted fulfilled, which are built around digital engagement, in a way that positions to offer that same level of service to customers across our entire business?”
Since the ecommerce division’s launch in 2012, Loblaws has introduced its ecommerce offerings at a deliberate pace, starting with its clothing line, Joe Fresh, in 2013; followed by its Shopper’s Drug Mart division’s BeautyBoutique.ca in 2015; and finally online grocery delivery last year.
Naturally, the ecommerce division has also been integral to the development and rollout of Loblaw’s PC Optimum program, the amalgamation of its former PC Plus and Shopper’s Optimum loyalty programs that was released last year.
‘Our customers were telling us’
Pee says Loblaw’s decision to fund a new startup-like ecommerce operation was an easy one to make because “our customers were telling us too.”
“It’s what they were looking for,” he says. “They were looking for convenience, looking to engage with us digitally, and our focus has always been on making sure we’re there for our customers.”
The division is run like a separate business too, steadily building an ever-expanding team of digital experts including product designers, developers, data scientists, product managers, and support staff including online merchants, sales and customer support staff, and content creators, all of whom work in a separate office from Loblaw’s main headquarters in Toronto’s Liberty Village neighbourhood.
“When we started looking where some of the talent that we were looking to attract and hire was, we realized that we wanted to be closer to the downtown core,” Pee says. “We also wanted to create an environment that fosters collaboration and innovation, where developers could be agile, in order to meet our customer’s needs as quickly as possible.”
(The neighbourhood is indeed well-known for its open-concept offices.)
And in order to better connect with its neighbours, Pee says, Loblaw Digital has been known to host networking meetings, hackathons, and open houses for the surrounding community.
The events “are a chance for us to open the door and give the great talent in the Toronto scene the opportunity to get to know us, to really learn more about our ambitions and challenges and the opportunities that we’re trying to deliver on and get excited about it.”
Pee says that while Loblaw Digital doesn’t publicly release ecommerce data such as online transactions as a percentage of overall sales, the division’s efforts have been well received by both its parent company and its customers.
“We track everything,” he says. “Every time a customer makes an order through any of our businesses, we obsess over what they tell us, and it’s been a fantastic experience across each of our digital experiences. We’ve really engaged and driven loyalty across each of our platforms.”
One of the most important lessons Loblaws has learned, Pee says, is that most of its customers aren’t exclusively in-store or online shoppers – they like to shop across multiple channels.
“Sometimes they’re looking for the convenience and inspiration of walking in a store,” he says. “Sometimes they’re looking for the convenience of being able to order online in their pyjamas. And sometimes they’re just looking for the broadest selection of items they couldn’t find at the neighbourhood store. And these are all opportunities that are enabled when you start thinking about delivering the best experience possible to customers from a multi-channel perspective.”
Of his division winning an ITWC Digital Transformation award, Pee says the team feels “fantastic.”
“It represents a lot of hard work by a lot of great folks,” he says. “And not just at Loblaw Digital but across the enterprise, to really drive a culture that is 100 per cent about our customers and able to move at such an incredible pace.”