H-E-B: Here Everything’s Better
Unlocking value by re-approaching the way an app is built
In late March of 2020, my paternal grandfather died of complications from Covid 19. Being a 95 year old man in a nursing home in New Jersey, his demographic made this highly likely, but obviously still a shock to our family. My mother, at the time, was stuck in New Jersey as well. She was with her mother who had just had hip surgery, and with the arrival of Covid 19 had no way to fly home to Texas. My dad, whose father had just passed, was stuck in Texas. Alone. This confluence of circumstances made him consider something he’d never have dreamed of but a few months ago: purchasing groceries through an App.
Fortunately for him, HEB, a much beloved Texas Grocery chain (think Wegmans of Texas) had been considering its digital future for a while now, and the recent pandemic had accelerated plans. Texas is first in the nation when it comes to filing for federal emergencies, as the state is battered by heat waves, cold snaps, hurricanes, flooding, and more. Often, local grocers are the first companies to open their doors, hire new people, and start to do business after one of these events happens. In the past, HEB had relied on their emergency-response team to deal with these situations after the fact, but in late 2019, they started to look at a new strategy led by digital solutions .
Integrating new digital tools into a grocery supply chain is a much more difficult task than it originally appears. Usually, the existing system is a jumbled mess of digital and analog tools used to track orders, merchandise, and payments from thousands of suppliers and distributors . Any new digital tool has to not only take over the functionality of the old tools, but do so without missing a step as its integrated. To address this challenge, the newly formed digital team adopted a ground-up approach. The bones of the digital tools they created were in order tracking, which allowed users to gain more information about the system they participated in. A smooth interface made the tools irresistible, and stakeholders started to migrate their own systems to compliment what HEB had created. With a single change in perspective, HEB had unlocked an incredible source of value, allowing suppliers to input and migrate their own information voluntarily, rather than forcing them on and risking inaccuracy or tardiness. From there, these stakeholders were quick to give HEB the control and information they needed, allowing them to create an app that launched in December of 2019 for everyone from greenhouse managers to grocers.
In practice, these new digital tools were tried by fire of the pandemic. HEB started to take action in early January, as they started to notice supply chain delays from their suppliers in China , where cases were on the rise. Following a Superbowl promotion, the App was slammed with traffic, showing technological bottlenecks, and creating not only a workstream to deal with them, but also procedural strategies to deal with future challenges. When the pandemic forced people into lockdown, HEB was much better prepared than its counterparts to deal with the influx in traffic, not only digitally, but on the digital-human interface. Unlike their competition, HEB had rolled out it’s curbside delivery and other options pre-pandemic. While Walmart (for example), had had digital tools to order for a while, at the customer and store level, very few people had experience with this experience, leading to delays, confusion, and frustration as this new way of working became a majority of orders.
The results were happy customers. Not only had HEB deployed more robust tools faster during the pandemic than their counterparts, but those tools were more polished AND more functional due to the excellent management of the operational interfaces (real people) needed to ensure that the digital tools could deliver value (get you your groceries). Ipsos, a national consumer research firm, found HEB the first of 14 in the grocery category in online orders, “largely due to in-stock availability, ability to schedule pickup times, and good instructions … Perfect accuracy, no fees or minimums, and excellent communication help them lead the category .” The spirit of improvement also didn’t stop there, as HEB quickly also sought more areas in which to expand its digital tools, such as allowing online SNAP ordering.
Student comments on H-E-B: Here Everything’s Better
As someone with no knowledge of grocery stores in Texas, this was pretty cool to read about! Any thoughts on what enabled them to see through a successful digital transformation? I see the value of the tech tools employed but also curious to dive deeper into policies/people/processes, etc.
Thank you for this wonderful piece, Sutton. Looking back on my experience in Italy at the beginning of the pandemic, I realize that an app like the one developed by HEB could have significantly helped thousands of families in my country. Unfortunately, few players in the marketplace had the capacity of delivering orders timely when the demand increased dramatically. I’m really curious to see how this service will evolve over the next few years, especially as competitors complete the development of their platforms.
Big HEB fan here, great to see that your family made use of their app in what sounds like a really difficult time – I’m so sorry for your losses during the pandemic. I’ve always wondered how grocery chains make the decision to offer a unique app or to partner with Instacart or similar businesses – or both. Do you have any thoughts on this after looking into the HEB case?
I remember reading about HEB’s preparedness in some NYTimes article at the start of the pandemic! It’s cool how this company’s digital innovations made it so well positioned to handle the disruptions. I’d love to learn more about what motivated the company’s digital transformation ahead of time, and why they were able to do this when so many of their competitors were not able to do so. (Presumably it wasn’t foresight about Covid-19!)