Albertsons offers a new refrigerated take on store pickup
Photo: Getty Images/Tomsmith585

Albertsons, along with many other grocers, has seen demand for its Drive & Go store pickup service increase significantly since the novel coronavirus began disrupting life in the U.S. earlier this year. The supermarket giant continues to look for ways to improve performance and is now piloting a temperature-controlled locker program that will expand the ways customers can get their orders in a contactless manner.

The company is kicking off the test in some Jewel-Osco locations in Chicago with plans to install the devices at some Safeway stores in the Bay Area later this year. Customers of those stores will see that a new “Pickup” option has been added to the two chains’ websites and apps when the lockers are in place. Those who go with the option will be prompted to choose a time window to pick up their orders. Once they place and pay for the order, customers will receive a unique code that they use to open the lockers and pick up their purchases.

The temperature-controlled lockers from Bell & Howell are modular and can be placed both inside and outside of grocers’ stores. The columns of lockers, according to a joint press release by Albertsons and the vendor, are modular and can be adjusted to meet the specific storage temperature of the orders placed by customers.

“Contactless PickUp through our state-of-the-art, temperature-controlled lockers makes it even easier to shop with us,” said Chris Rupp, Albertsons EVP and chief customer & digital officer, in a statement. “Whether customers choose to shop in our familiar neighborhood stores or through our websites and apps, we are ready to provide them with extraordinary service where and how they want to get their groceries. Our strategy to leverage technology and innovation to continue to grow our digital business is focused on creating products customers love that truly make their lives easier.”

Albertsons, like many other grocers, has seen online orders jump as COVID-19 has spread into markets where it operates stores. The company reported a 276 percent increase in digital sales during its fiscal first quarter and continues to expand its Drive Up & Go program to more stores operated by its various supermarket chains.

BrainTrust

“In 2030, the stores will be dark, the lockers will be full and the customers will swing by and pick up at their convenience.”

Gene Detroyer

Professor, International Business, Guizhou University of Finance & Economics and University of Sanya, China.


“We know from several studies that customers prefer to have curbside/BOPIS goods put right in their trunks so I think this idea is OK but not a home run.”

Lee Peterson

EVP Thought Leadership, Marketing, WD Partners


“Good for Albertsons for continuing to test options. While lockers aren’t new, with minimal interaction with staff required they are timely.”

Brian Numainville

Principal, The Feedback Group

Discussion Questions

DISCUSSION QUESTIONS: What do you see as the upsides and potential downsides of Albertsons’ use of temperature-controlled lockers for online orders? If successful, do you see the lockers as a means to supplement Albertsons’ existing pickup program or as an alternative where Drive Up & Go service is not logistically viable due to lack of lot space or other factors?

Poll

How likely is Albertsons temperature-controlled locker test to prove successful?

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22 responses to “Albertsons offers a new refrigerated take on store pickup”

  1. Neil Saunders Avatar
    Neil Saunders

    One of the great things about the lockers is that, other than loading them up with the product, there is minimal use of labor when it comes to collection. I guess this also helps with social distancing during the pandemic. The other plus point is that, in theory, the lockers can be installed anywhere so you could have them located in places distant from a supermarket. There is obviously a logistical effort in taking products to the locker location, but that can be less costly than last-mile delivery to homes. This sort of thing has already been trialed in the U.K. In 2014 Waitrose put temperature-controlled collection lockers at railway stations for commuters to collect their groceries on the way home from work. That’s probably less relevant now that fewer of us are traveling for work, but there is still some potential for the idea!

  2. David Naumann Avatar
    David Naumann

    On the positive side, pick-up lockers offer consumers another option for picking up their online orders in one of the most contactless manners available. It is also probably faster as the order is ready as soon as it is picked. The labor time to pick and place orders is similar to that of curbside, except that there is a savings of not needing someone to staff the lockers like you do for curbside pickup. I am a big proponent of lockers for grocery and virtually any segment of retail. Especially if the lockers are outside the store which enables 24-hour pickup.

  3. Suresh Chaganti Avatar
    Suresh Chaganti

    This makes sense, and feels like a logical next step. A futuristic yet logical progression would be to subsidize the cost of lockers on customers’ garage or porch. The printer/cartridge (or shaver/blade) model can be easily extended to freezer/grocery.

    Even more futuristic would be reducing the refrigerator replacement cycle and making it subscription oriented. A customer commits to a two-year grocery delivery program and the refrigerator is replaced every three years or so.

  4. Lee Peterson Avatar
    Lee Peterson

    We know from several studies that customers prefer to have curbside/BOPIS goods put right in their trunks (like H-E-B or Walmart does) so I think this idea is OK but not a home run. It will be good for quick pickup because of size restrictions on lockers and other “plus” items like meals-to-go but, for main grocery loads — not effective. But hey, Albies, keep plugging. Good to see an effort at getting BOPIS right and catching up after years of consumers being ahead of the game.

  5. Dave Nixon Avatar
    Dave Nixon

    Upside — flexible delivery methods driven by shopper needs for a better CX. Upside — deeper behavioral data that can be used for a more personalized CX. Downside — exteriors of stores and the corresponding parking lot are not designed for this type of traffic and “queueing,” possibly frustrating and detracting from the physical shopping experience for those that want to go inside.

  6. Gary Sankary Avatar
    Gary Sankary

    I like the idea. I do wonder about capacity. Will this create a bottleneck in the process? I’ve seen some retailers struggle with providing customers with timely appointments. When you’re ordering groceries, having the next available pick up window four days out is a problem. But this is certainly a step in the right direction because it provides customers with a touch-free, no wait way to get their orders and it helps the grocer manage workloads a bit better than staging orders in the backroom and having team members wait for a call when the customer arrives. Thinking down the road I can’t help but wonder if we’ll see some sort fulfillment center in stores of the future that will be like the old automats with aisles of lockers.

  7. Gene Detroyer Avatar
    Gene Detroyer

    In 2030, the stores will be dark, the lockers will be full and the customers will swing by and pick up at their convenience.

  8. Richard J. George, Ph.D. Avatar
    Richard J. George, Ph.D.

    The next step in the BOPIS evolution, made more pertinent in these pandemic times by its contactless nature. A potential upside may be the increased opportunity to enter the store, not concerned with the temperature of products in the locker, and add high-margin items to an empty shopping cart.

  9. Ryan Mathews Avatar
    Ryan Mathews

    I think this is a “better” not “best” solution. It solves a supermarket’s problem, we’ll have to see if it meets a genuine, sustainable consumer need. On the upside, product quality in frozen and fresh should be less of an issue and it potentially mitigates some of the “slotting pickup” issue. On the downside it forces shoppers out of their cars and makes them touch things. As to what the next step is, let’s see how consumers vote — but my guess is that over time lockers might replace the current pick-up model.

  10. Peter Charness Avatar
    Peter Charness

    Great idea. BOPIC not only keeps the safety factor satisfied during this pandemic, but it also offers a “get out of the house” factor, even if you don’t really end up doing the shopping.

  11. Doug Garnett Avatar
    Doug Garnett

    Albertsons runs a big risk here — of building an infrastructure for the pandemic which will be wasted after. The beauty of delivery to the customer’s car is that the infrastructure required is primarily staff — so it can expand and contract according to demand. Lockers won’t.

  12. Joe Skorupa Avatar
    Joe Skorupa

    This is not a game changer. Amazon launched its locker program in 2011 and it hasn’t set the world on fire. Will temperature control catalyze widespread consumer adoption of the locker option? Probably not. However providing options for consumers to shop is a smart move by Albertsons. Consumers want more last-mile choices and Albertsons is giving them what they want.

  13. Sterling Hawkins Avatar
    Sterling Hawkins

    The incremental added convenience here isn’t a game changer. Albertsons now needs to focus on successfully refining the experience in and around the lockers (mobile, online, etc.) that will make or break their utility. True today and will still be true in a post-COVID world.

  14. Craig Sundstrom Avatar
    Craig Sundstrom

    I’ve nothing against it per se, but I’m curious about the logistics: an average supermarket serves, what, 5000 households? 10,000? Obviously not all of them will want to make use of this but more to the point, only a very small fraction CAN make use of it. I fear “lack of space” will describe the problem a lot of the options to the conventional way(s) of shopping will face.

    1. George Anderson Avatar
      George Anderson

      Capacity is also an issue for curbside pickup and grocers handle this through the use of scheduling windows. The same is being applied here. How well they manage it remains to be seen.

      1. Craig Sundstrom Avatar
        Craig Sundstrom

        Indeed! For all the enthusiasm that commenters express for ideas intended to move away from the paradigm of BISPIS, the people who actually have to implement them often have other thoughts.

  15. Brian Numainville Avatar
    Brian Numainville

    Good for Albertsons for continuing to test options. While lockers aren’t new, with minimal interaction with staff required they are timely. But I don’t see this as a pandemic-only solution — some people will likely prefer this and continue to use the lockers into the future. But like anything, we will see where this shakes out relative to other options being tested/deployed.

  16. Camille P. Schuster, PhD. Avatar
    Camille P. Schuster, PhD.

    Continuing to test options is commendable. However, if people are using this option for less contact, they will not want to be standing next to others getting their groceries in the next locker. If people are doing this for convenience, they will not want to park, get out of and lock the car, go into the store, find the locker, load a cart, go out to the car, unload the cart, return the cart, go back to the car, and drive away. If someone took items from the locker and loaded the items in the trunk, this solution might be more popular.

  17. Ananda Chakravarty Avatar
    Ananda Chakravarty

    It’s great that they’re testing the model. Cold chain is one of the more expensive last mile delivery scenarios. However, not sure lockers are the way to go. As some have mentioned, they’ve been around for a while, have had limited adoption, and with COVID-19 brings up concerns about reusable lockers. Not sure consumers want their raw steak in the same box as someone else’s frozen carp and exotic cheese, even if wrapped in plastic sitting around for a few hours.

    Albertsons will need to convince customers that they maintain clean and regularly disinfected lockers on the inside and out. Some customers will try it out and it can still supplement other engagement options.

  18. storewanderer Avatar
    storewanderer

    This will probably work better in some locations than others. For instance, inner city locations where customers primarily do not drive a car to the store but walk or use transit, this provides a “walk up and go” of sorts.

    Clearly it is a labor saving move and also a time saving move for the customer to be able to collect their own items and go without having to wait for a staff to bring the items to the customer. This aspect of the service I find to be appealing as sometimes the wait for pick-up orders at retail stores can be 5-10 minutes with the Walmart pick-up that is not ever staffed (unless you have a Tower then maybe you can get it and go) or the Target pick-up that is mixed with that fun refund line (what a fun line), and I’ve often joked I could have gone in and collected the items myself in the time it took to get the pick-up done.

    It seems like a modified version of the Walmart pick-up towers.

    Ultimately the customer will decide if this will be a thing or not.

  19. storewanderer Avatar
    storewanderer

    However I do also have some serious concerns about this pick-up locker idea in a grocery store. How will substitutions be handled? How will customer concerns over quality be handled? It seems like they will need to have a consistently staffed department to handle these types of things. And no, the customer service department at Safeway, unlike many other retailers, is not consistently staffed. It is run by the person who sits in the back office and counts money (cash office) and difficult to find assistance during its limited posted hours, I’ve ever seen “out to lunch” signs posted on it at some locations in the middle of the afternoon. This will need to be addressed for this to work.

  20. Kenneth Leung Avatar
    Kenneth Leung

    Just like any technology, it serves a segment and not a total solution. It isn’t a magic bullet and stores have to deal with cleaning for spills and produce dirt buildup. For certain areas, it is a good concept and customer adoption will tell whether it is worthwhile.

22 Comments
oldest
newest
Neil Saunders
Neil Saunders
2 years ago

One of the great things about the lockers is that, other than loading them up with the product, there is minimal use of labor when it comes to collection. I guess this also helps with social distancing during the pandemic. The other plus point is that, in theory, the lockers can be installed anywhere so you could have them located in places distant from a supermarket. There is obviously a logistical effort in taking products to the locker location, but that can be less costly than last-mile delivery to homes. This sort of thing has already been trialed in the U.K. In 2014 Waitrose put temperature-controlled collection lockers at railway stations for commuters to collect their groceries on the way home from work. That’s probably less relevant now that fewer of us are traveling for work, but there is still some potential for the idea!

David Naumann
David Naumann
2 years ago

On the positive side, pick-up lockers offer consumers another option for picking up their online orders in one of the most contactless manners available. It is also probably faster as the order is ready as soon as it is picked. The labor time to pick and place orders is similar to that of curbside, except that there is a savings of not needing someone to staff the lockers like you do for curbside pickup. I am a big proponent of lockers for grocery and virtually any segment of retail. Especially if the lockers are outside the store which enables 24-hour pickup.

Suresh Chaganti
Suresh Chaganti
2 years ago

This makes sense, and feels like a logical next step. A futuristic yet logical progression would be to subsidize the cost of lockers on customers’ garage or porch. The printer/cartridge (or shaver/blade) model can be easily extended to freezer/grocery.

Even more futuristic would be reducing the refrigerator replacement cycle and making it subscription oriented. A customer commits to a two-year grocery delivery program and the refrigerator is replaced every three years or so.

Lee Peterson
Lee Peterson
2 years ago

We know from several studies that customers prefer to have curbside/BOPIS goods put right in their trunks (like H-E-B or Walmart does) so I think this idea is OK but not a home run. It will be good for quick pickup because of size restrictions on lockers and other “plus” items like meals-to-go but, for main grocery loads — not effective. But hey, Albies, keep plugging. Good to see an effort at getting BOPIS right and catching up after years of consumers being ahead of the game.

Dave Nixon
Dave Nixon
2 years ago

Upside — flexible delivery methods driven by shopper needs for a better CX. Upside — deeper behavioral data that can be used for a more personalized CX. Downside — exteriors of stores and the corresponding parking lot are not designed for this type of traffic and “queueing,” possibly frustrating and detracting from the physical shopping experience for those that want to go inside.

Gary Sankary
Gary Sankary
2 years ago

I like the idea. I do wonder about capacity. Will this create a bottleneck in the process? I’ve seen some retailers struggle with providing customers with timely appointments. When you’re ordering groceries, having the next available pick up window four days out is a problem. But this is certainly a step in the right direction because it provides customers with a touch-free, no wait way to get their orders and it helps the grocer manage workloads a bit better than staging orders in the backroom and having team members wait for a call when the customer arrives. Thinking down the road I can’t help but wonder if we’ll see some sort fulfillment center in stores of the future that will be like the old automats with aisles of lockers.

Gene Detroyer
Gene Detroyer
2 years ago

In 2030, the stores will be dark, the lockers will be full and the customers will swing by and pick up at their convenience.

Richard J. George, Ph.D.
Richard J. George, Ph.D.
2 years ago

The next step in the BOPIS evolution, made more pertinent in these pandemic times by its contactless nature. A potential upside may be the increased opportunity to enter the store, not concerned with the temperature of products in the locker, and add high-margin items to an empty shopping cart.

Ryan Mathews
Ryan Mathews
2 years ago

I think this is a “better” not “best” solution. It solves a supermarket’s problem, we’ll have to see if it meets a genuine, sustainable consumer need. On the upside, product quality in frozen and fresh should be less of an issue and it potentially mitigates some of the “slotting pickup” issue. On the downside it forces shoppers out of their cars and makes them touch things. As to what the next step is, let’s see how consumers vote — but my guess is that over time lockers might replace the current pick-up model.

Peter Charness
Peter Charness
2 years ago

Great idea. BOPIC not only keeps the safety factor satisfied during this pandemic, but it also offers a “get out of the house” factor, even if you don’t really end up doing the shopping.

Doug Garnett
Doug Garnett
2 years ago

Albertsons runs a big risk here — of building an infrastructure for the pandemic which will be wasted after. The beauty of delivery to the customer’s car is that the infrastructure required is primarily staff — so it can expand and contract according to demand. Lockers won’t.

Joe Skorupa
Joe Skorupa
2 years ago

This is not a game changer. Amazon launched its locker program in 2011 and it hasn’t set the world on fire. Will temperature control catalyze widespread consumer adoption of the locker option? Probably not. However providing options for consumers to shop is a smart move by Albertsons. Consumers want more last-mile choices and Albertsons is giving them what they want.

Sterling Hawkins
Sterling Hawkins
2 years ago

The incremental added convenience here isn’t a game changer. Albertsons now needs to focus on successfully refining the experience in and around the lockers (mobile, online, etc.) that will make or break their utility. True today and will still be true in a post-COVID world.

Craig Sundstrom
Craig Sundstrom
2 years ago

I’ve nothing against it per se, but I’m curious about the logistics: an average supermarket serves, what, 5000 households? 10,000? Obviously not all of them will want to make use of this but more to the point, only a very small fraction CAN make use of it. I fear “lack of space” will describe the problem a lot of the options to the conventional way(s) of shopping will face.

George Anderson
George Anderson
  Craig Sundstrom
2 years ago

Capacity is also an issue for curbside pickup and grocers handle this through the use of scheduling windows. The same is being applied here. How well they manage it remains to be seen.

Craig Sundstrom
Craig Sundstrom
  George Anderson
2 years ago

Indeed! For all the enthusiasm that commenters express for ideas intended to move away from the paradigm of BISPIS, the people who actually have to implement them often have other thoughts.

Brian Numainville
Brian Numainville
2 years ago

Good for Albertsons for continuing to test options. While lockers aren’t new, with minimal interaction with staff required they are timely. But I don’t see this as a pandemic-only solution — some people will likely prefer this and continue to use the lockers into the future. But like anything, we will see where this shakes out relative to other options being tested/deployed.

Camille P. Schuster, PhD.
Camille P. Schuster, PhD.
2 years ago

Continuing to test options is commendable. However, if people are using this option for less contact, they will not want to be standing next to others getting their groceries in the next locker. If people are doing this for convenience, they will not want to park, get out of and lock the car, go into the store, find the locker, load a cart, go out to the car, unload the cart, return the cart, go back to the car, and drive away. If someone took items from the locker and loaded the items in the trunk, this solution might be more popular.

Ananda Chakravarty
Ananda Chakravarty
2 years ago

It’s great that they’re testing the model. Cold chain is one of the more expensive last mile delivery scenarios. However, not sure lockers are the way to go. As some have mentioned, they’ve been around for a while, have had limited adoption, and with COVID-19 brings up concerns about reusable lockers. Not sure consumers want their raw steak in the same box as someone else’s frozen carp and exotic cheese, even if wrapped in plastic sitting around for a few hours.

Albertsons will need to convince customers that they maintain clean and regularly disinfected lockers on the inside and out. Some customers will try it out and it can still supplement other engagement options.

storewanderer
storewanderer
2 years ago

This will probably work better in some locations than others. For instance, inner city locations where customers primarily do not drive a car to the store but walk or use transit, this provides a “walk up and go” of sorts.

Clearly it is a labor saving move and also a time saving move for the customer to be able to collect their own items and go without having to wait for a staff to bring the items to the customer. This aspect of the service I find to be appealing as sometimes the wait for pick-up orders at retail stores can be 5-10 minutes with the Walmart pick-up that is not ever staffed (unless you have a Tower then maybe you can get it and go) or the Target pick-up that is mixed with that fun refund line (what a fun line), and I’ve often joked I could have gone in and collected the items myself in the time it took to get the pick-up done.

It seems like a modified version of the Walmart pick-up towers.

Ultimately the customer will decide if this will be a thing or not.

storewanderer
storewanderer
2 years ago

However I do also have some serious concerns about this pick-up locker idea in a grocery store. How will substitutions be handled? How will customer concerns over quality be handled? It seems like they will need to have a consistently staffed department to handle these types of things. And no, the customer service department at Safeway, unlike many other retailers, is not consistently staffed. It is run by the person who sits in the back office and counts money (cash office) and difficult to find assistance during its limited posted hours, I’ve ever seen “out to lunch” signs posted on it at some locations in the middle of the afternoon. This will need to be addressed for this to work.

Kenneth Leung
Kenneth Leung
2 years ago

Just like any technology, it serves a segment and not a total solution. It isn’t a magic bullet and stores have to deal with cleaning for spills and produce dirt buildup. For certain areas, it is a good concept and customer adoption will tell whether it is worthwhile.