“Saving time is just as important as saving money.” That is what Patrick Shanks, regional vice president for Walmart Neighborhood Market operations, has said about the consumer’s quest for convenience. Walmart’s first Neighborhood Market store that is cashierless opened in January, in Florida.
There, at least until COVID-19 social distancing practices, sales associates roamed the floor, helping customers check out using handheld mobile devices. Self-checkout lanes feature expanded room for large baskets, a change from traditional Walmart self-checkout lanes, and the stores accommodate buy-online-pick-up-in-store, as well as same-day grocery delivery.
Three-quarters of consumers say they want in-store staff to use mobile devices to provide a better in-store experience, according to the State of Mobility in Retail report, which SOTI, a provider of mobile-technology support, released in January. Two years after Amazon Go opened its first cashierless store, “speed is the number-one thing customers are looking for” in their shopping experience, Shash Anand, SOTI’s vice president of product strategy, told SCT. Retailers that adapt quicker, more-efficient frictionless technology are more likely to have repeat customers who stay in the store longer. The technology “increases trust levels,” according to Anand. “Customers think, ‘This is a company that is adapting to my needs’ … and the brand gets elevated more,” he said.
Not all cashierless technology is the same. “Cashierless technology falls on a continuum, based upon the role that the consumer plays in the checkout process,” said Jerry Sheldon, a retail technology analyst at Franklin, Tenn.–based IHL Group. Grabango’s checkout-free technology tracks customers’ selections by means of small, ceiling-mounted cameras, CV (computer vision) and artificial intelligence. Regional grocery chain Giant Eagle is piloting the service, which integrates with a store’s existing point-of-sale system so shoppers can pay either by app or from a traditional checkout line.
To gain entry to AWM Smart Shelf–enabled stores, shoppers scan a QR code with the Smart Shelf app. Mounted cameras, digital shelving and object-identification software keep track of items. Mexican convenience chain Oxxo recently adopted the technology. Based on the items customers have placed in their carts, this technology also suggests additional items for purchase, provides coupons and digitally directs consumers to the aisles for those items. “We’re really getting to a place with our data where we can predict what the customer is going to do,” said Kaitlyn Kempiak, Smart Shelf’s marketing director.
Other cashierless technology keeps the checkout process but focuses on making self-checkout more efficient. Caper’s smart shopping carts, for instance, are equipped with bar code scanners, cameras for item recognition, and credit-card swipers. This means that shoppers can scan and pay for items using the carts themselves. Italy-based Datalogic’s technology, meanwhile, is so advanced that the scanning system can even differentiate between a Gala apple and a Red Delicious. Many self-checkout customers stumble over produce checkout and lose time, says Jose Vega, a Eugene, Ore.–based retail marketing manager with Datalogic. And the new Impinj wireless tag, which relies on Rain RFID (a battery-free, wireless technology that connects UHF-frequency RFID tags to the internet) automatically scans items as they are placed in baskets at self-checkout lines.
Saving on labor
Cashierless systems save retailers on labor too. “With cashierless technology, no one’s calling in sick to work or saying, ‘I’m going to be late because I have car trouble. You’re always going to have labor,” said Sheldon. Such technology also allows retailers to reallocate employees from checkout to the places where customer interactions matter most: on the floor.
But cashierless systems that rely on cameras, sensors and AI can cost hundreds of thousands of dollars. The Wall Street Journal pegged the cost of outfitting a 7-Eleven-size store with cameras and camera vision at about $100,000 to $300,000. “It’s hard to understand the cost-effectiveness [of these systems] for a large format,” Sheldon said.
For smaller convenience stores, however, the future may already be here. In June of last year, Retail Business Services, the U.S. arm of Netherlands-based supermarket chain Ahold Delhaize, installed a 300-square-foot cashierless convenience store, Lunchbox, at its Quincy, Mass., headquarters. The company decided to provide this for its workers while the regular company cafeteria was being renovated. The company worked with UST Global to develop the store, which relies on AI to track items. The system operates through a proprietary app that admits customers into the store and then charges their digital wallets. Setup took only about seven weeks, says Kenneth Bolick, senior director of IT innovation at Retail Business Services.
“We feel that we could implement [a cashierless store] even more quickly in future locations,” Bolick said. It was a real-life example of where cashierless technology is going. “We’d all been hearing that this type of thing is possible, but what amazed us is how accurate the artificial intelligence is and how accurate the orders are. That trust is so important in the retail industry.”
Consumer behavior also changed. “There was this amazement as people walk out,” Bolick said. “You’re so used to having friction in your lifestyle, so when you just have to walk out, you almost wonder if it’s OK. You see people hesitate, and you have to be like, ‘Yeah, keep walking — you’re fine.’ ”
Now, months later, people have quit reaching for their wallets.