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Fresh food, faster shopping: Albertsons Companies reimagines supermarkets with digital innovation

Food retail is a complex, competitive business that belies the simple consumer act of buying bananas or avocados. Supply chains must deliver thousands of products with a limited shelf life, and retailers must serve in-store and online customers, all of whom want fresh food and convenient shopping.

Albertsons Companies, the second largest food and drug retailer in the United States, is meeting those challenges with a comprehensive digital strategy. With Microsoft as a partner, the Boise, Idaho-based company is launching cloud-based innovations that optimize operations, personalize promotions, differentiate the business and ultimately make shopping faster and easier for its 35 million weekly customers.

A portrait of Anuj Dhanda.
Anuj Dhanda

“We are reimagining the future to serve customers in a way they want to interact with us across all channels,” says Anuj Dhanda, Albertsons Cos. executive vice president and CIO. “Microsoft’s strengths in technology applied at scale at Albertsons Cos. is a winning combination for a great step up in customer experience and how we run the end-to-end company.”

The retailer operates 20 supermarket banners, including Albertsons, Safeway and Vons, in 35 states and Washington, D.C.

The businesses are exploring how to use computer vision, connected sensors and other artificial intelligence technology to reduce friction in the shopping experience.

The work is part of the company’s growing digital investments, including a redesigned e-commerce platform now on Microsoft Azure for scalability. The retailer has also installed customer Wi-Fi in stores, improved its mobile apps, and expanded services for home and rush deliveries of groceries and Plated meal kits. It expanded options for customers to buy online and pick up in-store. And it launched a pilot last year to deliver deli meals with Grubhub.

Last month, the company announced a 73 percent quarterly increase in e-commerce sales.

“We know our consumers are changing how they interact with us, so we want to move with them and be where they want us to be,” says Ramiya Iyer, Albertsons Cos. general vice president of digital stores and pharmacy. “It’s about advancing choices and making those choices even better.”

The choices include easier gas payments through the pilot program One Touch Fuel. Customers can download an app, store credit card info and then simply tap their phone to pay at a gas station. There’s no need to dip a credit card, enter a ZIP code or go through other pump prompts.

An Albertsons fuel pump.
One Touch Fuel will help customers save time at the gas pump.

Hosted on Azure, the digital innovation saves receipts and can automatically apply discounts from just for U®, the company’s loyalty and digital rewards program. One Touch Fuel is available at 27 of Albertsons Cos.’ nearly 400 gas stations.

“Everybody who uses the app finds it very convenient and likes how it saves time,” says Mark Schumacher, Albertsons Cos. senior director of fuel and convenience.

For workplace efficiency, the retailer uses Microsoft 365 to enable a secure, collaborative environment for store and corporate employees. The intelligent solution provides access to important information like promotions and recalls, leading to better customer service.

The retailer is also leveraging Microsoft’s expertise in data science to streamline its massive supply chain, which involves thousands of manufacturers and growers, 2,000 trucks, 2,280 stores and an average of 50,000 products per store. Data helps the company match supply and demand, keep food fresh, serve customers, and anticipate weather- and event-related impacts.

“Clearly, data is the lifeblood for optimization of the flow, and carrying the widest, smartest variety of products,” says executive vice president and CIO Dhanda.

As data science advances in speed and precision, the company wants to use it for real-time, personalized promotions. So, if you just bought avocados and entered your loyalty number, the retailer might send you a coupon for chips that taste good with avocados – while you’re still in the store.

“The whole idea is that we’re able to create personalized deals for millions of customers based on what they shop for, how they shop and what we believe they would want to consider,” says Dhanda. “We’re using data to get effective and efficient to really meet our customers’ needs.”

All photos courtesy of Albertsons Companies.