Cashierless stores: Checking out the potential future of retail
Embracing digital transformation will be crucial for bricks and mortar retailers if they’re to revive their fortunes on the high street. One solution many British supermarkets are trialling is the cashierless store concept. Here, Daniel Ackers, senior account manager for retail at Cloud Technology Solutions, looks at the technology needed to enable the possibility of cashierless stores, which could see it take off in the UK retail market.
The cashierless store was first introduced by Amazon in 2016 when it launched Amazon Go. It was Amazon’s first entry to bricks and mortar retail in the US, and the concept was all centred around convenience for the customer. The concept behind making Amazon Go work is straightforward. Customers ‘tap in’ using their phone upon entry to the store, pick up the items they want and put it straight in their bag. The store’s built-in technology – which includes cameras, sensors and artificial intelligence – monitors what customers have picked up and automatically charges their Amazon account for the products when they leave the store.
The store has been a real success for Amazon in the US, with the online retail giant announcing big expansion plans to open as many as 3,000 new stores by 2021. And this success hasn’t gone unnoticed by the UK retail sector, with many large supermarkets looking to mirror Amazon’s trailblazing concept.
Sainsbury’s opened its first checkout-free store in April last year as part of a wider trial and Tesco announced in October that it had invested in technology that would allow it to do the same. The investments in check-out free stores demonstrate that our supermarkets are taking this way of shopping seriously.
If these trials are a success, we could see cashierless stores become commonplace across the UK. But what technology will retailers need to make the cashierless model a reality? What opportunities do these technologies present? And are there digital infrastructure barriers that need to be overcome if the model is to become mainstream?
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Integration is key
The cashierless store model is interesting because its success relies on the ability to bring together some of the biggest technological developments of the last ten years into one harmonious system. Cloud infrastructure, the internet of things (IoT), big data and machine learning (ML) are all intrinsic to the cashierless store. And they must work in unison for the model to deliver the benefits retailers hope it will.
Cashierless stores need to be fitted with state-of-the-art sensors and cameras that cover every square metre of the store to monitor what shoppers are picking up from the shelves and what they’re placing back.
IoT technology will also be vital in making sure each item is automatically scanned once placed into a basket. This information can then be fed into artificial intelligence technology, which in turn informs the store’s billing system and inventory departments – a process that’s crucial in allowing stock to be replenished and customers to be billed accurately.
To make the most of the data gathered, cloud infrastructure will be vital in order to create data lakes for the information to be stored and interrogated. This data can then be used to optimise stock management, reducing overall wastage while improving cost efficiencies across businesses.
For large retailers with multiple stores across the country, cloud technology allows data from all sites to be held in one central location. This allows for important analysis to be done on stock levels, so that stores that capitalise on any local events or good/bad weather forecasts by having the most relevant stock available.
Teething problems not repelling retailers
Clearly, the technological apparatus required to create a successfully functioning store is significant. So much so that technology investment could be the main barrier to mainstream adoption of cashierless stores. There are other challenges posed by the cashierless store model too.
For example, Amazon Go stores in the US do not allow entry to customers without funds in the account linked to the device they scan when they first enter the store. This is to ensure that a customer cannot leave the store with products without having the money available to pay for them.
This system disregards the fact that some shoppers may wish to browse before returning at a later date to purchase goods. This means that for luxury retailers with high-priced goods, this model may not be suitable. As a result, some finetuning may be required if the model is to be rolled out across the entire retail sector.
While challenges do exist, the potential to harness real-time insight and optimise operations remains attractive to retailers. Particularly as the challenging high street environment and changing consumer expectations means retailers are continuously looking for new ways to adapt and stay relevant.
So, while adopting a cashierless store model might necessitate significant change for retailers, their investment in trialling these systems shows that this is not stopping them exploring the possibility. If retailers can iron out the wrinkles and make the most of the innovative technology available, it might not be long until we see cashierless stores’ full adoption across the UK.
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