Sam’s Club On Bringing The Digital Shift To Warehouse Stores

The supermarket has become a vital institution in recent months as it is one of the few types of businesses deemed essential and allowed to stay open through the thick of the pandemic. This has meant that store operators have had to rapidly implement health and safety rules to minimize transmission risks among workers and customers — especially the most vulnerable.

These realities are casting a new light on some of grocery stores’ recent innovations, such as Stop and Shop’s hand-held product scanners and Target’s and Whole Food’s mobile ordering and curbside pickup services. These offerings have delivered greater efficiency and convenience for employees and customers alike. The COVID-19 era has given these technologies the potential to not only reduce frictions in the shopping experience but also to make it much safer.

Sam’s Club has been a notable player in the digital innovation arena. The membership-based warehouse store chain has long prioritized digital innovation, both in its customer-facing and internal operations. One of the centerpieces of this effort is the company’s Scan & Go app, which was introduced in 2016. The tool allows customers to scan UPC barcodes on products as they shop and show their digital receipts to employees before exiting.

The app has surged in popularity since the pandemic for a number of reasons. It allows customers to hasten shopping trips, maintain proper distancing with other customers and employees and avoid the potentially most crowded part of the shopping experience: the checkout line. Use of the Scan & Go app has increased nearly fivefold since March, Eddie Garcia, senior vice president and chief product officer at Sam’s Club, told PYMNTS in a recent interview.

“We’ve seen a strong uptick in member adoption during the pandemic because it gives them the ability to pay for items right from their phones and skip the checkout line. It completely removes the friction and uncertainty of waiting in a checkout line right now,” he said.

The app is just one aspect of a multipronged digital strategy that grocers such as Sam’s Club are embracing to help customers safely and efficiently shop during the pandemic and its aftermath.

Technologies To Aid At-Risk Shoppers

The pandemic has triggered a digital shift across the economy over the past few months. Not everyone is prepared to go digital overnight and alter entrenched shopping and lifestyle habits, however. Senior citizens may face a formidable learning curve, for example, but they are also among the most vulnerable to the virus and should take advantage of these new digital tools.

Sam’s Club has adapted its existing technology platforms to accommodate seniors and other at-risk groups. Its concierge service allows such customers to tell or provide grocery lists to store employees, who then use a specially configured Scan & Go app to fulfill and bring their orders to their vehicles.

“We were able to build the associate-facing app that powers our concierge experience in just six days because we built it on top of our already existing Scan & Go platform. That’s the cool thing about technology — if you invest in building platforms the right way, you can accelerate innovation,” Garcia said.

He noted that nearly 132,700 concierge transactions had been completed as of early June.

The company is also enhancing the mobile device workers use on the floor. An emergency app allows them to quickly report confirmed COVID-19 cases and another app enables them to count how many customers are in-store at any given time to comply with capacity restrictions.

A Proving Ground For Innovation

There is another important aspect of the new reality in which consumers are living: Millions have discovered online grocery shopping, and many may gladly put braving stores aisles and checkout lines behind them for good.

Sam’s Club has seen orders through its website and apps increase significantly, with eCommerce revenues up 40 percent in Q1 2020. These online orders may be poised to grow even more substantially, however. The company thus began rolling out curbside pickup to all of its nearly 600 stores in June after a pilot program at 16 locations.

“During the pandemic, the way our members want to shop, how they want to check out and their expectations around safety and service is different than it’s ever been,” Garcia said. “Members are putting a lot of focus on having control over their shopping experiences, so we had to quickly react and provide them more choices to shop how they want.”

A tremendous amount of work goes into making mobile grocery apps and other digital services function well and seamlessly. Implementing such programs is nearly impossible to do quickly without already having robust technology pipelines and infrastructures in place — and this reality extends to unforeseen disruptive events.

Garcia explained that Sam’s Club pilots new digital services at a special facility in Dallas called Sam’s Club Now that “allows [the company] to test and try new things in a test club environment with real members.”

“Almost every new innovation we roll out — including the concierge app — is first tested at Sam’s Club Now so we can listen to our members, engage with their feedback and then iterate the technology to make it the best product possible,” he said.

Toward The Future

The pandemic has exposed digital divides across the economy. Some businesses already had robust digital channels in place and others have had to improvise to survive. The crisis has, in this sense, underscored the importance of having technological systems that are resilient and agile — that can respond to any unanticipated disruptive events.

“The current crisis has taught us that constant innovation is key to being prepared for the … challenges that come our way. The work we were already doing with tech, and the deployment of new tools at Sam’s Club allowed us to move quickly,” Garcia said.

This is important both to keep operations running in the future and to meet changing consumer demands and expectations. Ample studies, including PYMNTS research, indicate that many of the digital shopping habits adopted during the pandemic are likely to outlast it.

“I anticipate technology will continue to be important to our members because they are hyper-focused on speed and safety right now and I don’t think that will go away. Retail was already going through an evolution pre-COVID-19, but the pandemic has accelerated change and pushed retailers to adapt, pivot and innovate.”

This means that innovations taking place at Sam’s Club stores and among its customers could just be the early stage of sweeping digital transformations that will continue for months and years to come.