Omnichannel engagement technologists build a better retail customer experience on Azure

Modern retail solutions need modernized IT

Internet shopping has become commonplace, but for many people, shopping online for groceries in particular is becoming increasingly attractive. Working from home, looking after children, or simply avoiding spending time inside stores are changing our shopping habits, and events over the last few years have led increasing numbers of people to buy groceries from stores with personal shopping services or have them delivered directly to their homes.

Ahold Delhaize USA is a family of individual store brands and service companies that form one of the largest retail grocery groups in the United States. Within Ahold Delhaize USA, Peapod Digital Labs (PDL) creates and manages the e-commerce technology the brands use to provide shoppers and store associates alike with the best possible online shopping experience. PDL is modernizing its complete technology stack, including its own infrastructure, with a goal of transforming its on-premises environment into a cloud-first platform more suited to developing and operating modern, omnichannel digital solutions.

PDL, its sister company Retail Business Services, and the Ahold Delhaize Global Support Office partnered with the Microsoft Industry Solutions Delivery team to deploy the enterprise-grade cloud platform CF 2.0. CF 2.0 is hosted on Azure, and it’s built following Azure landing zone principles. According to Amit Shah, Chief Technology Officer at Peapod Digital Labs, PDL already has its first fully modernized solution running on this new infrastructure. “The first release on our modern cloud platform is our cloud-optimized store-picking app, which is fully deployed and operated in Azure,” he says. “We got the foundational cloud platform pieces ready in less than three months, and then we had the fully modernized application used in over 800 stores in under eight months. It’s a great success story.”

Cloud-optimized store picking: A strategic triumph for PDL

The first app to take advantage of the new cloud infrastructure underpins a key part of the online order fulfillment process: store picking. When customers place online orders, store pickers retrieve items from store shelves and prepare them for delivery or pickup. The new app offers a modern user experience on desktops, tablets, or mobile devices for in-store associates to help increase store picking efficiency. It’s already demonstrating its effectiveness by reducing out-of-stock, non-fulfillment errors by 33 percent, staff training time by 50 percent, and in an overall productivity gain of up to 3 percent.

But as impressive as those numbers are, they don’t fully speak to the importance of this work in validating the new cloud-first direction taken at PDL. “Transformed store-picking is a triumph—the first accomplishment for us and our new CF 2.0 Azure cloud platform,” Shah says. “It’s business-critical and strategically important in our broader journey to be fully in the cloud over the next couple of years.” And, he says, the new app takes full advantage of Azure data services. “The PostgreSQL database platform in Azure is really powerful, resilient, modern, and it enables business continuity with built-in redundancy and disaster recovery.”

Developing, delivering, and operating in the cloud

That journey to the cloud uses key Azure Data & AI technologies, including one that provides the ability to consolidate data from existing on-premises databases. “Data warehousing in Azure has transformed ingesting, storing, and accessing crucial business information from our on-premises enterprise data lake,” says Ramesh Gentyala, Senior Director at Peapod Digital Labs. “Our data analytics applications can now use Azure Synapse Analytics to source data almost in real time.” PDL is also migrating on-premises data stores such as Informix servers to Azure Database for PostgreSQL and Azure Cosmos DB. “Cloud migration has transformed how our data is structured today,” says Shah of the flexibility and agility that he sees as a result. “We had a monolithic data setup with our previous architecture, but we’re breaking that into smaller databases, which gives us far greater flexibility. We take full advantage of Azure database services that we can quickly deploy and use at scale.” 

But along with the data storage and analytics side of the journey are those technologies that help develop, deliver, and operate PDL’s solutions on behalf of each Ahold Delhaize USA brand. According to Oleg Shokodko, Director of DevOps at Peapod Digital Labs, those advantages come from the comprehensive tool set in Azure. “For example, Azure Kubernetes Service is definitely one of the best environments available for microservice app development,” he says. “And we use a variety of tools and technologies to operate those services, such as Azure Application Gateway and Azure Traffic Manager.”

The advantages of multitenancy

PDL’s latest development efforts are demonstrating the efficiencies of the multitenant architecture of CF 2.0 on Azure in supporting the distinct local brands of Ahold Delhaize USA. “Each is its own individual entity and gets its own distinct deployment,” Shah says. Each instance might now be no more than 250 users, as opposed to a single on-premises entity with thousands of users. “The technology overhead is now much lower, which is a huge win.” That architecture also provides increased security and scalability for each store, and it offers the opportunity to roll out changes and updates and tune performance on an individual basis. “We can first roll out an app version to the smallest brand with the least amount of impact and learn from it before rolling it out to larger ones,” adds Shah.

Improving speed, security, and continuity

Shah recognizes many benefits in moving to the cloud, first of which is increased overall speed and agility for his organization. “We measure ourselves in terms of speed to market for our solutions,” he says. “Our purpose is to make sure we reduce points of friction as we innovate and change, from development through deployment into production. How do we make the process faster? CF 2.0 running on Azure is the answer.” Building the new store-picking app demonstrated how modern development and delivery practices dramatically reduce time to market for new and improved features. “We use GitHub, and we now have a state-of-the-art continuous integration and continuous delivery pipeline,” says Shah. “As feedback comes in and we learn more, that gets pumped into the feature list and quickly rolled out in a continuous improvement and delivery loop.” Coupled with on-demand scale and capacity from Azure, Shah says PDL is well positioned to handle the rapid growth of the businesses that his technology supports.

Security is also a fundamental requirement for PDL in supporting the retail stores and the brands’ customers. “We use the Security Controls Framework that’s baked into the Azure platform,” Shah says. “We can apply the security controls consistently across the entire stack, with the advantage of powerful automation for management and reporting.” And of course, all of those advantages are lost if the environment is unavailable; key to the business-critical fulfillment process is the availability and continuity of the underlying technology. “We get really robust disaster recovery in Azure from running two active regions in parallel with cross-region replication,” he adds.

Doing the impossible

PDL isn’t stopping with the successful launch of its latest cloud-optimized app. “This is just the start. We might end up with a small number of apps on-premises that aren’t mission-critical, but we have more solutions moving to Azure at a much greater rate over the next two years,” Shah says. “There are numerous benefits, but basically, we’re able to do things that weren’t possible with our previous architecture. CF 2.0 on Azure has been a cornerstone of our effort to improve productivity and build out our suite of modern omnichannel digital engagement solutions.”

Find out more about Peapod Digital Labs on LinkedIn.