SPAR helps customers make grocery savings with an Azure-based customer app

“The beauty of our app is that it’s a real effort to help people save up real money. It’s an attempt to phase out our brick-and-mortar roots and into the digital age. And to do it with an eye on the environment too.”  

Andreas Kranabitl, Managing Director at SPAR Austria's IT subsidiary SPAR ICS, is looking back at the digital transformation journey that his company has embarked on – and how it’s helping it provide better services to its customer base.

“At SPAR, our mission is to help our customers save as much money on their groceries as possible,” says Kranabitl. “And we think that technology has a huge potential in helping us do that.”

It’s a vision that SPAR has found the answer to in cloud technology. Using Microsoft Azure, the retailer has developed a customer app that it claims is revolutionizing the way it caters to its customers. One that is ultimately making it more attractive at an international level and better fitted for the customer demands of the future.

“Our industry is evolving,” he says. “Everywhere in Europe, there are growing pressures to drive efficiency, speed up our operations and drive innovation.  

“To do that, we need to embrace digitalization: we need to modernize our systems and networks to make space for new solutions and technologies. Luckily for us, Microsoft is here to help us do that.”

Digitalizing services for the modern customer

SPAR Austria Group is a leading Austrian retailer with presence in 8 European countries and running 3,026 stores.  

With a workforce of 50,600 people in Austria, it is the largest private employer in the entire country. And with a sales turnover of more than €18.63 billion in 2022, it is also the market-leading supermarket chain in Austria.

As Kranabitl explains, the company has been a Microsoft partner for many years. “We’ve worked with Microsoft since the days of Office on the desktop,” he says.

“Throughout this time, Microsoft has gone from being just a technology supplier to a trusted partner with products like the Microsoft Cloud for Retail- allowing us build business-critical applications like our data and analytics platform and demand forecasting solutions.

More recently, he adds, the focus has shifted towards creating mobile customer solutions fit for the modern shopper.

“We really want to help our customers to make savings when they shop with us” he explains.

The app in a nutshell

Built off the back of its paper-based version, SPAR’s new app gives users access to a range of discounts and vouchers designed to help them save up on their shopping.

Customers downloading it are assigned a barcode that they can use to collect tokens, get digital receipts of their purchases and more. By doing that, not only do they receive promotions and discounts, but also help to phase out the use of paper across the stores.

But according to Robert Guggenberger, Service Owner at SPAR ICS, the star feature of the app is the so-called SPAR Joker, which, during certain periods of the year, automatically applies a 25% discount on up to four of the highest priced discount-eligible products in the shopping basket.

“The main and most important concept of the app is that we want to help customers to save money,” he says.

“To do that, we joined forces with Microsoft and built an app that’s efficient, scalable, secure and easy to and manage.”

Running fully on Azure, the app has a microservices architecture that relies on Azure App Services for .Net and Java services, over API Management and EventGrid for functions and communication – and DB and PostGreSQL for data storage.

It has a cloud setup consisting of several subscriptions with about 400 Azure resources. Several product teams within SPAR set up their resource using Infrastructure as Code written in Azure Bicep to achieve as much automation and consistency as possible.

“For a perfect running solution, we also take advantage of autoscaling, zero-downtime deployments and high availability,” says Guggenberger. "Through our central MS Azure API Gateway, we can currently process millions of daily requests hundreds of them per second."

Crucial to its success, he adds, is that it guarantees that the data is used in a sparing manner, requiring consent to the terms of use. This means that personal information such as name, address and even date of birth is not needed. “This was one of the most important points for us,” he continues. “If our customers don’t want to log in their details, they should be able to do that.

“So, we decided to design the app in a way that avoids it. All we require is that they accept our terms and conditions. If they want to, they can also voluntarily specify up to three favourite SPAR store locations of SPAR. Based on this information, they’ll be able to receive regionally valid vouchers.”

A rollercoaster development leads to millions of downloads

In place since August, the app has enjoyed huge widespread success up and down the country.

This is a hard-earned sigh of relief and reason for pride for both Kranabitl and Guggenberger, who can now look back at the rollout and the rollercoaster it turned out to be.

“It definitely wasn’t an easy road,” says the former. “You see an app that is easy and simple to use, designed for optimal customer experience… but getting it to that point wasn’t without challenges.”

Echoing his words, Guggenberger recalls the complexities of integrating the existing on-prem point of sales system – in other words, the cash registers – with the near-real-time requirements it had.

“That was such an important part of our work,” he says. “We have more than 1,500 stores across Austria. If something fails to work in the way it needs even for a moment, it could have huge ripple effects on all of the customers shopping at that particular store – causing delays and frustration that are quite tough to action.

“Microsoft was our partner of choice for that, because of the amazing retail know-how it always brings to the table. This applies particularly to the Industry Solution Delivery team, who were provided incredibly helpful expertise on the architecture and on the infrastructure implementation processes – as well as security and best practices.”

A cultural shift from the top down

Key to the success of the initiative, says the SPAR team, were the cultural and change management efforts that took place in parallel with the development of the app.

“We had a really short timeline to set up the basis of our cloud platform, so getting everyone on-board with it from the beginning was crucial,” says Guggenberger. “That made it a technical as much as organizational transformation for us.”

Kranabitl adds: “This was one of the success factors of our project. Since the early days, everyone recognized the potential of this app as lighthouse for future innovations and a foundation of what we can do at SPAR Austria and beyond.”

“Receiving a huge amount of management support since the very beginning was fundamental in our success.”

Another crucial aspect was ensuring that frontline staff working at cashiers and in shops also were fully comfortable and up to speed with the solution. “We have thousands of people working at our stores,” he says. “If they don’t know what to do, our entire operation collapses. To help them do that, we launched several training campaigns aimed at getting them up to speed with it.” 

That, he concludes, was ultimately the secrete behind SPAR’s success. “Since the first meeting we held, we knew that the most important thing to do was surrounding ourselves with the right people through every step of the way,” he says.

“That’s exactly what we did. From the top management to the on-site staff and our trusted experts at Microsoft, we gathered a team of passionate people who had one common goal: helping customers live better and save money.”