The Impact of Digital Technologies on The Danish FMCG Industry

Abstract

This master thesis aims to analyze how advanced implementation of digital technologies in the FMCG industry will impact consumers’ shopping experience and the future of Danish grocery retailing. Motivation for this study was an interest in the intersection of technology and the FMCG industry and and to gain a deeper understanding of Danish customers’ attitudes and perception towards implementation of more technology-drived actitivities in their grocery shopping experience. Furthermore, the purpose of the study was to establish the Danish grocery retailers’ attitudes towards digital technologies and find out what they are already investing in. The empirical research includes 2 focus groups with younger and older consumers and 3 individual interviews with representatives of grocery retailers in Denmark (Coop, Dansk Supermarked and Dagrofa), as well as an individual interview with an expert from the Technological Institute. In order to delimate the scope of the research, the author has chosen to analyze RFiD technology, “Just Walk Out” Amazon’s technology and Mobile Apps. The findings from the empirical research have shown that from the presented technologies, mobile apps are the only technology that Danish grocery retailers are currently investing in, which also corresponds to the findings that younger customer’ preferences are to use mobile phones rather than in-store devices facilitated by the retailer. The analysis also revealed that RFiD technology can provide several valuable benefits both to customer and retailer, but economical and technological barriers make the implementation difficult for Danish grocery retailers. The younger customers are more ready to embrace the benefits of digital technologies in their daily grocery shopping, since technology is already a big part of their life than for the older consumers. The older consumers, on the other hand, are curious about and value the benefits of in-store technological solutions, but prefer instore devices provided by the retailers. Based on the empirical research it can be concluded that future grocery stores in Denmark will consist of an increasing involvement of smartphones, personalized customer experience and a focus on convenience. Nonetheless, retailers can’t forget that technology will never substitute the traditional elements of a grocery shopping experience such as reasonable prices, good product selection, excellent service and pleasant physical surroundings and these should not be downgraded in the wake of an increasing focus on technology.