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Tesco Teams Up With 'Facebook for Groceries'

February 7, 2012

Tesco recently signed up with a new social network website that describes itself as "the world's first personalized social shopping platform for groceries." Besides creating a food-centered web community and a personalization tool, Foodie.fm links to a retailer's real time assortment to allow users buy products seamlessly.

Dubbed in the media as "Facebook for groceries," Foodie.fm was created by Finland's Digital Foodie. Its core technology is a patent-pending recommendation server that learns from users' eating and purchasing habits and suggests recipes and groceries that match their taste profile. Suggestions take into account users' personalized preferences, including food allergies, intolerances, predilections and budget restrictions.

The site then builds a digital shopping list of the necessary ingredients with Tesco.com. Foodie.fm checks with Tesco that items are available before the order is paid for and delivered. Prices, product and nutritional information from Tesco's mix are also accessible.

From the online community perspective, Foodie.fm, available as a free app as well as via the web and Facebook, enables users to make friends with other food lovers and to swap cooking tips and recipes. Users can access personalized recipe and product suggestions, comment on recipes and see updates and recommendations from family and friends they follow on the site.

"Say that you are on a gluten free diet, it is very helpful to see what recipes others with gluten free diets are having and what breads they are liking," said Kalle Koutajoki, CEO of Digital Foodie, in a statement. "Detailed nutritional information of more than 35,000 products and thousands of recipes along with user ratings provide valuable information when making purchasing decisions."

The beta test with Tesco is just underway, but Digital Foodie has been working over the last year with S Group, one of the largest retail chains in Scandinavia, on developing the technology.

"Transparency is very important to us," said Ilkka Alarotu, Director, Assortments and Pricing, S Group, in the statement. "With Foodie.fm, we have opened up a channel for direct customer feedback, recommendations and discussion, while making grocery shopping easier and more fun."

FINANCIALS:     [PINK:TSCDY]

Discussion Questions:

Discussion Questions: How appealing would Foodie.fm's promised social networking and personalization tools likely be for consumers in the U.S.? What's the potential of a Foodie.fm-like service for use as a loyalty tool?

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

What's the upside potential of a social/personalization website such as Foodie.fm in the U.S.?

Comments:

Lord take me now! When will we realize that this invasive "social networking" model is actually one huge marketing conspiracy? It's a trap people ... run for your lives! A "loyalty tool?" Are you kidding me?

I'm sure there is a "network of networks" out there already but I don't want to hear about it. A plague on their networks! And in regard to "Foodie.fm" -- is the world really clamoring for ways to make grocery shopping "easier" and "more fun?" If true, that is so sad and we are closer to the end times than I thought. When I see frogs falling from the sky I'm outta here! Let me know what you think via my Facebook page.

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Ian Percy, President, The Ian Percy Corporation

Yes, I am a foodie. I currently use Fine Cooking magazine, Foodnetwork.com, Cookingchannel.com and on occasion the epicurious free app to search for new recipes. I am inspired by watching a chef on-air and then finding that recipe on their site. In fact, this past weekend I hosted a dinner party and the main dish and dessert were from cookingchannel.com. A free app that allows me to share and find the best recipes sounds interesting. I also like the idea of a quick shopping list build. Nutritional values per serving would also be helpful.

As a foodie, one of my biggest challenges is using the rest of a fresh item to make something else that week. Imagine if this app could offer up suggestions on how to best use only the fresh ingredients that week. For example, I buy fresh Thyme (only during the winter when I can't grow it) and only use 3 springs for the recipe. Suggest 2 or 3 other recipes that use fresh thyme so I can use the rest.

I visited the site, registered and filled out their survey. Nice interface, easy to use and the recipes they suggested for me (after completing the survey) were interesting.

Which US retailers will get on board first?

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John Boccuzzi, Jr., Managing Partner, Boccuzzi, LLC

This service has some specific capabilities that may appeal to consumers in the US. I am not sure that additional recipe sharing and social networking is really what consumers need any more; there are so many ways to connect and share that typical consumers feel overwhelmed rather than in need of new channels.

What is interesting is the recommendation engine and automated grocery list development based on consumers dietary means and food preferences. I am assuming that the service will also develop or adjust recipes to meet calorie targets as well. This part of the service has some uniqueness and potentially some stickiness as well. When you combine that with a grocery delivery service, you may have a package that has some appeal.

Since loyalty in the grocery channel is so driven by convenience, I am not sure whether a service like this will truly drive loyalty. Some frequency of use by highly recipe-engaged consumers, but it is difficult to drive consumers to new channels and solutions in a high frequency business like grocery (otherwise delivery would have taken over years ago...).

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Mark Price, Managing Partner, LiftPoint Consulting, Inc.

Foodie.fm is one of those services that make you appreciate entrepreneurship; it's simply a great idea that addresses some basic unmet needs for customers. And this one works as well for actual foodies as it does for "moms on the playground" discussing what's for dinner that night!

Beyond that, for brands and merchants it's an example of where social and loyalty will ultimately converge in ways that the social "networks" like Facebook and Twitter fall short: the ability to extract useful transactional data and profile information, make it useable and addressable in order to create demand that will lead to actual sales.

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Phil Rubin, CEO, rDialogue

I think this would be very helpful in meal planning for the consumer and assortment planning for Tesco. If Tesco has insights into what meals a consumer is planning regardless of the source of the ingredients then Tesco has an insight that no one else has.

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Joe Nassour, Chief Technology Officer, RetailTactics

I'm constantly advising clients not to over-spec their product offerings and to focus on finding unmet needs that speak to the majority of their consumer base. Maybe Phil Rubin is right and there are some basic unmet needs that Foodie addressed; but to me this feels like over-specing the grocery shopping experience.

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Martin Mehalchin, Partner, Lenati, LLC

Once again, Tesco leads the way. One has to tip their hat at Tesco's lust for innovation and courage to try stuff!

The question "How appealing would the tools be for consumers in the U.S.?" is somewhat tricky. The answer is deeply appealing to some and completely irrelevant to others. This is clearly something designed for the highly engaged food consumer and not for the Big Mac munchers out there. The good news is that the super-engaged consumer in just about every category accounts for the majority of profitable sales.

Doug Stephens, President, Retail Prophet

Curious; a question about cooking and grocery shopping, and so far all of the respondents are men!

'notcom'

Ian! Tell us how you REALLY feel! You said it very, very well.

Is this app a time saver or a time taker? Tesco advising you on everything from gluten content to condom size (to save time, of course)? Or, do users get so immersed in trading recipes and getting "down in the weeds" with all the variables and surrender more of their time to apps? And make no mistake about it, there are lots of app addicts. The most visible, of course, are the cellphone zombies who walk into mall fountains (you've seen the video) or, as of this week, allow a baby carriage to roll within inches in front of them onto a railroad track with a train coming. All while staring down into their cellphones. The modern version of contemplating their navels.

The siren songs of "meal planning" and "automatically-generated shopping lists" have long been sung. But, we eat what we want, we use family recipes, and we like cruising through supermarkets enjoying the sights and smells, making ourselves open to impulse sales. We like that stuff, and those siren songs have proved to be off-key for decades.

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M. Jericho Banks PhD, President, CEO, Forensic Marketing LLC

Online grocery ordering is a failed experiment in the US for the moment. Peapod and others made a good run, but in the end the adoption was not there.

In the UK and other EU nations, consumers are well indoctrinated to purchase groceries online and have them delivered to their homes. This is the first step upon which other service offers can be made. Foodie.fm might be a natural extension of the online shopping model in these countries, but I don't think we're ready for it in the US.

Our loss?

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Bill Hanifin, Managing Director, Hanifin Loyalty LLC

Terrific idea. We have a LOT of folks trying for this space and not quite getting it right. Even some of the pros like Walmart's list-builder and some of the grocery ones. This one has some progress. Not quite there, but a step in the right direction.

For those who have an interest in the empirical, Bill Bishop has done some recent work on BrickMeetsClick, looking at how actual grocery shoppers view their physical stores and compares that to how those same consumers view the online/mobile capabilities of those same grocers.

There are a good many hurdles to making progress in this arena, not the least of which is the lack of product images and data or the preponderance of wrong images and data on the digital path to a shelf with very different packaging. For more on this ask for ShelfSnaps recent studies on the subject.

Mike Spindler, Managing Partner, Panther Mountain Companies, LLC

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