COVID and the cashierless store
Are cashierless stores the future after COVID? Daniel Ackers from Cloud Technology Solutions thinks it’s a real possibility
No other industry has been affected by coronavirus in the same way as retail. On the one hand, the supermarkets, essential stores and ecommerce retailers have seen unprecedented demand for products and sales have soared to levels not even seen at Christmas. But on the other hand, non-essential and bricks and mortar retailers have seen their takings plummet to zero for the last few months.
With stores now reopening, the retailers that have struggled will not only have to contend with making up for four months of reduced sales but must also adapt to the ‘new normal’ that COVID presents. Many shoppers will still be wary of visiting physical stores. Those who are happy to visit the high street will likely also know exactly what they want to buy in order to limit their in-store. Window shopping has become a thing of the past for the foreseeable future.
There is no doubt coronavirus will have long-lasting implications on the retail sector. And to ensure they’re able to entice customers into stores, non-essential retailers have a challenge on their hands if they’re to compete with their online counterparts. Limiting touchpoints in store will be crucial. Reducing contact with store assistants will give customers and employees peace of mind, while limiting customers’ time spent in high footfall areas of a store, such as tills, should give consumers more confidence visiting the high street.
One in-store concept that could benefit retailers in a post-COVID world, which has already piqued the interest of supermarkets, is the cashierless store. First introduced by Amazon in 2016 when it launched the Amazon Go store, the cashierless store has since encouraged the likes of Sainsbury’s and Tesco to trial the concept in some of their own shops.
These stores have been designed with convenience front and centre of their design. Customers enter a store by tapping in with their phone, pick up the items they want and simply walk out without visiting a till – significantly reducing the amount of time spent in-store. In the Amazon Go shop, the store’s built-in technology monitors what customers pick up and automatically charges their Amazon account for the product once the customer has left.
Of course, the vast majority of retailers won’t be able to mirror the payment technology used by Amazon unless they have or build a similar account billing infrastructure, but other elements of the cashierless model could be emulated.
To make the concept work, cashierless stores use some of the biggest technological developments of the last ten years in one harmonious system. Cloud infrastructure, the IoT, big data and machine learning are all intrinsic to the model. Encouragingly, the widespread adoption of these technologies in recent years means most large retailers are already using these solutions in one way or another within their organisations.
Where investment may need to be made is in the technology used to monitor what customers are picking up from the shelves. Amazon Go, for example, uses state-of-the-art sensors with cameras that cover every square metre of the store. Using IoT technology, it can scan when an item is placed into a basket and placed back on the shelf. From a longer-term benefit perspective, this can be invaluable for retailers looking to tighten their inventory control process. It also means stock can be replenished in real time and customers billed accurately.
The cashierless store concept, up until now, has been driven mainly by supermarkets. This means the model has been designed with a supermarket format and shopper in mind, therefore adjustments may need to be made to the current model – predominantly how the consumer is charged.
Currently, the Amazon Go shops only allows entry to customers with funds in the bank account linked to their Amazon account. This is to ensure a customer cannot leave the store with products without having the money available to pay for them.
While this system may work in a supermarket format, for retailers with more expensive items – for example, shops that have products that demand higher price points such as TV’s or luxury clothing – customers may wish to browse before returning at a later date to purchase an item.
In the short term in a post-COVID world, where consumers aren’t window shopping like they used to, this model may be suitable. Longer-term, however, retailers will need to adapt and potentially remove the requirement for having suitable funds in a bank account.
Despite some of the initial challenges that may come with implementing cashierless stores, the concept holds a huge amount of potential for bricks and mortar retailers moving forward. Not only does it improve health and safety instore, but it also provides retailers with a huge amount of insight. Monitoring what items are picked up gives retailers real-time information into what products customers are interested in and which ones they aren’t. Being able to access information on which products are picked up and, more importantly, placed back on a shelf also gives retailers crucial information on which products that may require promotional support to encourage a consumer to go ahead and purchase it.
It’s these nuggets of information that can make all the difference for retailers as they navigate the tricky waters of the high street over the next twelve months. While the cashierless model seems like a distant dream, it could in fact provide the lifeline many retailers have been looking for.