Customer (Iteration 2)

Target Segment 1

Young workers in the group age of 25-40 years old. They have an active lifestyle and are tech-savvy. There are 2 sub-segments under this segment:

“On-the-go” customers: A typical customer prefers short time spent on both shopping and payment. Normally, “On-the-go” customers don’t have much time to spend for grocery shopping since they are busy with daily schedules and activities. They are more likely to opt for time-saving options like vending machines or online grocery shopping. Even though they have a tendency to buy snacks and ready to eat foods, they could easily change their mind, depending on the offer of the supermarket. “On-the-go” customers definitely do not have time and patience for a long queue at the end of their shopping for payment. They are looking to save some time while doing their grocery shopping, to go back to work as soon as possible. In their case, two solutions are possible for them: either implementing an online shopping experience more efficient for them or to develop a new way to shop in stores, with a customized experience with less time spent in the store.

Casual customers who want time-efficient shopping experience: A typical customer does not mind spending time strolling around the store, but he or she prefer shorter time at the counter and payment. Customers in this group consider grocery shopping as an activity for unwinding themselves after work, having quality time for themselves or loved ones. Therefore, they look for a both exploratory and personal experience when viewing, deciding and picking an item. Those customers are too familiar with cashier's long beelines, and they will be more than happy not to go through the waiting every shopping time. 

In the following graph, the average weekday shopping time in Japan has increasing from 20 mins in 1976 to more than 25 mins in 2016. As of 2021, the average time spent is estimated at around 30 minutes for weekday, 30 - 40 minutes for Saturday, and up to 1 hour for Sunday (Source: https://www.stat.go.jp/english/data/shakai/2001/shousai/yoyaku.html#1)

As a matter of fact, if the average weekday shopping time in Japan was decreasing, many other customers might be interesting with the offline shopping experience. In the case of on-the-go customers, those are likely to change their mind and go grocery shopping if they don't have to lose time while shopping or at the end of the store.

Why do we target this segment:

Our targeted working population between 25 - 40 years old is estimated at 20 million people in 2021, which is roughly 16% of overall Japan population. The market is, therefore, significant enough for our proposal. (Source: https://www.stat.go.jp/data/roudou/longtime/zuhyou/lt03-03.xlsx)

We believe that working adults in Japan, especially within our targeted age group, are able to learn and adapt quickly to our solution based on their strong literacy foundation. According the report from Organisation for Economic Co-operation and Development (OECD), adults in Japan display the highest levels of proficiency in literacy and numeracy among adults in all countries participating in the survey. The performance of Japanese adults in the assessment of problem solving in technology-rich environments.  Japan has the highest proportion of adults of working age (16-65 years) who are proficient at the highest three levels of literacy as measured by the Survey of Adult Skills among participating countries. Some 48.6% of Japanese adults are proficient at level 3 in literacy and 22.6% of adults are proficient levels 4/5 in the same domain. Japanese adults achieve similar good outcomes in numeracy, with 43.7% proficient at Level 3 and 18.9% proficient at levels 4/5. (Source: https://www.oecd.org/skills/piaac/Country%20note%20-%20Japan.pdf)

Our team also base the analysis and proposal on our own experience since we can be representatives of this segment. In fact, our team members are conveniently fitted within the age range 25 - 40 years old. We all have working experiences either through full-time or part-time roles. Also we are exposed enough to day-to-day technologies to perform transactions like shopping activities.

Target Segment 2

Customers in the group age of 25-65 years old who are financial-conscious, especially women. Majority of the women in Japan are familiar with saving money and shopping within their budget. This saving money habit is called “Kakeibo”. On top of that, a recent survey conducted by SMBC Consumer Finance shows that more people in Japan have become more budget-conscious during this pandemic. Therefore, we see that there is a need to provide a seamless customer experience for this group of customers by adding a feature to allow them access the data of their monthly spending on groceries and cheaper product recommendation. This later can attract more customers inside and outside of this group since AEON helps them to shop consciously. 

Why do we target this segment:

This is another significant group of customers. The number of female population in Japan is over 64 million. Within our targeted segment 25 - 65 years old, the estimation of customer population is around 28 million, which is around 22.2% of Japan population. Japanese women account not only for the majority of the country’s population but also enjoy one of the longest life expectancies in the world. There are more women joining the workforce recently which allow them to be more financially independent.
(Source: https://www.stat.go.jp/english/data/jinsui/tsuki/index.html)

In 2017, Worldbank data survey showed that 80-89% of people in Japan own mobile phones and most people in high-income economies have access to the internet. Therefore, this customer segment is very potential to perform transactions using their smart phones and utilize the new developed features we offer.

A typical customer in our targeted segment can navigate through the apps comfortably. Based on the data collected by Think Google in 2018 as in pictures below, this targeted customers segment is very promising as more than 50% of Japanese consumers said that smartphones help them reduce stress which indicates that they like to spend  time on their smart phones and 63% of smartphone users are more likely to purchase goods when they are recommended to relevant products they may be interested in. 

Problems faced by customer segment 1

• For customer at cashier counter, time-consuming as items are individually scanned and packed by staff
• Error in scanning as staff lost focus: sometimes some items barcode isn’t readable by the machine, and the staff needs to write every number one by one which takes time as well.
• Price tag can have wrong information (weight, expiry day, price, etc.) at the shelves
• No proper and timely recommendations to potential food containing allergy ingredients, e.g. gluten 
• No recommendations based on past purchases
• Time-consuming and error-prone process to scan and find the potential food containing allergy ingredients
• No proper dedicated app for grocery shopping
• For customers who prefer online shopping: Losing time going to the grocery store (transport). Not having much time to shop, if you finish working late at night: most of our customers are looking for more efficient solutions as they might go grocery shopping after work.

Problems faced by customer segment 2

• Recording the bill manually is time consuming: if you want to properly build your budget takes lots of time for the customer.
• Keeping the paper bill requires some space in the wallet
• There is the risk that ink on the paper bill fading out before the data gets recorded.
• No recommendations for discounted or bundled purchases
• No reminder on potential of overruning of budget

As consultants, we are recommending AEON to develop an AEON application with many different features on it, answering 3 use cases: 

1. Need for time-efficient grocery shopping while keeping qualitative recommendations
2. Need to properly record your monthly financial spending
3. Need to be able to perform online shopping to save time

Use Case 1: Efficient, self-service and personal shopping experience with tech-enabled capabilities.

By developing an app, AEON can offer a more time-efficient and empowered experience to customers. With this app, customers can use their own phones to scan the products, and transfer the data to self-checkout counters for payment.  When a customer scans a product, there will be a check mark showing that the product is perfectly scanned. 

• Additional shopping suggestions can also be shown for cross-selling/up-selling opportunities. For instance, after scanning the spaghetti pack, a customer may receive a suggestion saying “Most of our customers also bought” with a relevant tomato sauce option. If the customer wants to follow the recommendation, he or she can click on the suggested item. Information on where to find the products will then be shown 
   
• Another feature is recommendation based on historical grocery shopping of the customer. If the customer already bought certain product in the past, there will be a suggestion mentioning “last time, you also purchased this item”.
   
• One more feature that would come from usage of the app is “Food Allergies tracking” function. As a matter of fact, many people in Japan suffer from food allergies and don't have real treatment for it, so they need to adapt their food consumption to avoid certain products. For instance, there are more than 600,000 students with food allergies and approximately 400,000 infants had some. These numbers are only based on the number of people that went to the hospital to get a specific treatment, so one might think that there is an even higher number of people  having an allergy or a food intolerance, as many of them don't go to the hospital to be diagnosed. While downloading the application at first, our customers will be asked to answer certain questions about them and their household. After logging in the application, they can share the replies to questions such as “Pick in the following items food allergies/intolerances your household has". With data gathered from customers, AEON will be able to make specific recommendations to such customers, so as to avoid health risks and save time from having to exchange or replace for suitable products. For instance, if the customer is gluten intolerant and scans a product that contains some to put it in its basket, the customer's phone will vibrate with a warning pop-up window mentioning the presence of gluten in this product. To help the customer pick a similar product without gluten, the application would also give specific recommendations of similar products that are gluten-free. 

Use Case 2: A financial diary feature in AEON mobile app that will provide the data of customers monthly spending and transactions history.

Customer who are financial-conscious will find this feature very helpful to manage their financial. Customers are no longer required to keep all the bills they receive from stores and manually record the numbers to see how much they have spent for grocery shopping. While clicking on the budget section on the application, the customer is able to find its weekly consumption with many different details (How much the customer spent in which type of food, the average they spent on a month in food and so on). If customers are on a strict budget, and looking for a way to reduce their costs, the application could also help in two different ways:

• Recommendations of cheaper products when customers scan certain products: as mentioned above, there is the “social” aspect of the customers for AEON. By providing recommendations of cheaper products to the customer, he/she feels better understood by AEON but is also more likely to come back in the future → “AEON for the customers”
• offering the possibility to the customer to create their own budget based on what they previously purchased: if the customer sees that he/she approximately spends ¥9,000 then while cutting costs he/she might want to reduce it to ¥6,500. Then by entering this objective on the application, based on the previously purchased items, it calculates how much the customer would spend in each type of food (e.g. ¥1,000 in dry products, ¥2,500 on vegetables and so on).

Use Case 3: Online shopping alternative for busy professionals

A last feature on our application would be the online ordering part. As a matter of fact, many Japanese young workers mention that they are losing many time going to the grocery store and picking out their product to wait in line to pay at the end. 

With our feature, customers would be able to order grocery on the application, while still having as good insights as if they were in the stores. They could directly do their grocery shopping while being at home or still at the office, to go pick it up later in the day or in the week in a specific hour. 

In Europe, this feature already exists for many grocery shopping brands, giving the customers great advices and products, while they are still saving some time. In the case of AEON, there will also be other features, more customized to the customers. 

Our customers would only have to follow these steps:

• Go on the application and in the category “online shopping”
• Pick the store the closest/more practical to them (near their work office, their home, their children's school…)
• Choose the products they want to order, while getting specific recommendations for it (for instance “WARNING: this product contains some gluten”)
• At the end when the customer is reviewing its basket, they could also have for specific products up-selling/cross-selling recommendations: for instance, if the customer took some French fries, they would get recommendations at the end saying “most of our customers also buy this type of ketchup with this product” and they would be able to add it directly to their basket if they want.
• As they created their account at the beginning, they would also be able to pay really fast, maybe if they previously logged their credit card.
• As they picked the store at the beginning of online shopping, they would just need to choose the day and the time they want to go pick it up. They can pick between 6:00 a.m. and 10:00 p.m. Their grocery shopping will be kept in a cold space for maximum 24 hours, so that if the customer is late from work they could still go pick it the next day.
• The customers only need to go at the store then, and only scan their application while coming in. If they come by car, they could only scan it on an outside terminal, and remain in the car while AEON employees would come deliver the bags to them. If they come by any other transportation, they would only need to go at a specific AEON corner, to scan their application and get the bags from AEON employees.

One of the future option for AEON afterwards would be to do some grocery shopping deliveries afterwards.

Determine the values, beliefs, and motivations of the customers - find what is important for them

Customer Truth of Use Case 1

• Grocery shopping is a routine, so if there are more new personal experiences, that will be great
• Long queue of customers for cashier counter → Need time-efficient solutions
• Owning the smartphone, customers are excited to explore extra capabilities of the phone in daily activities: the customers are tech savvy and would rather use their phone for daily activities or anything related to technology.
• Quickly share the great experiences to social media: if the customers are satisfied with our products/services, they would easily share it on social networks (facebook, Instagram…)
• Curious to find out more information about existing and new products
• Tend to go with non-cash payment, hence payment should be completed in a quick yet safe and personal way: especially with the COVID-19 crisis, customers would rather pay with their credit card as this is more hygienic. This is at the same time faster and safer for them.
• Other people can see what one shopped for: while waiting to pay, other customers could look at one’s shopping bag on the counter. They get less privacy → Checkout should be done fast and in personal way
• Personal experience only happens at the counter when scanning the membership card, etc: while grocery shopping, the experience remains the same for all customers.
• Existing self-scanning system uses shared public phones which are not safe enough during pandemic
• “If I go as fast as I can in a store, I end up with less insights and information about the products I just bought.”: while trying to go as fast as possible in a store, customers tend to lose quality over it. They don’t get proper information and recommendations for their products.
• Getting proper recommendations based on your customer profile: customers want to feel that the company takes care of them personally, with a customized service/
• It is difficult for the customers to immediately find a proper replacement to a product, if you’re allergic to something in it.

Customer Truth of Use Case 2

• Financial-conscious and committed to regularly saving money: customers are looking into their budget, and trying to save costs wherever they can. If they need to cut costs on specific products, they would do it to focus on their budget.
• Shopping with budget, such as weekly or monthly budget.
• Interested in analyzing the data of their historical purchases: as they are looking to cut costs, looking at their personal historical grocery data will help them to build their budget afterwards and to know which expense could be deleted.
• Willing to manage their spending wisely: if they get a specific recommendation about a similar product but less costly, they would gladly change to this one.
• Existing self-checkout counters do not have many payment options and do not accept voucher

Customer Truth of Use Case 3

• “I lose too much time going grocery shopping once or twice a week. Plus you have to wait in line to pay at the end of your shopping and it gets me more anxious”
• “I lose time to go to the grocery store, when I could just work at my place or at the office”: by losing some time inside the store but also with the transport to go to it, it is burdensome for the customers, since they are also going to their office on a daily basis. It could be easier for them to do both at the same time.
• Need for time-efficient solution in a market where those don't exist yet: in the Japanese market, there aren’t many time efficient solutions for grocery shopping. If customers want to go faster, they go to konbinis but lose the large amount of products offered with recommendations.
• “on-the-go” customers. They are looking for time-efficient grocery shopping experiences, but they lose the quality in the meantime. If they found a solution enabling them to go grocery shopping as fast as possible while offering them qualitative services and products they would totally go for it.