With technology constantly growing, we've had one of our first cashier-less supermarket open this year with more following. Will this be the way forward for the FMCG and retail industry? In this blog we discuss the potential pro's and con's of using the 'Just Walk Out' style technology.
Standing in long queues at a supermarket store waiting to be served isn't something we particularly enjoy. No matter how many check out's they open, brick-and-mortar stores still can't always ensure swift movement, especially with socially distanced queues during the ongoing pandemic.
However, since Amazon opened their first checkout-free grocery store, Amazon Fresh in the UK, and are now selling their cashier-less technology called 'Just Walk Out', other companies have seen the success and want to start making the same change for their own stores moving forward using the latest technology.
The first Amazon Fresh store opened it's doors on the 4th March 2021 in Ealing, West London offering the first "contactless" shop in the UK - since then, they have continued to open up more shops around London, including:
It's available to anyone signed up to Amazon, that has the app on their phone, and must be able to scan a personalised QR code to gain entry into the store. They use a combination of computer vision, depth sensors, and machine learning to know the items that their shoppers take home - it then calculates the bill to charge their Amazon account.
Since all their stores have been such a success, it's sparked interest in other businesses around the UK. What impact will this technology have on the traditional brick-and-mortar businesses?
After looking at how Amazon Fresh works with their new stores, and other companies wanting to do the same - how does the future of the traditional brick-and-mortar industry look if we were to move toward the latest way of shopping with technology?
The biggest advantage for consumers is time efficiency. The whole idea behind the 'grab & go' process is to pick up what you need and leave. In today's fast paced society, it goes hand in hand with busy people and their time schedules. For those on a quick lunch break, running to catch a bus - knowing you can get the products you need in thirty seconds is a unique selling point and will encourage consumers to make the most of your business.
Technology isn't only benefitting the consumers, it brings plenty of advantages for the business as well. Surprisingly, theft has been reduced with any of the Amazon Go/Fresh stores as the 'Just Walk Out' technology automatically detects when an item is picked up and replaced to the shelves. With no real knowledge of where cameras are located, they have the ability to correctly scan and detect barcodes even if it's obscured, which is pretty impressive and reduces a loss of profit.
A frictionless shopping setup also helps retailers optimise their profit and loss in many different ways. It allows the companies to free up square footage for more productive use, which allows reassignment in-store for what Amazon have deemed as "more valuable activities," including restocking shelves and personally assisting customers on a better level.
Whilst there are plenty of positives from the latest technology, there does seem to be some concerns that need to be mentioned with this new style of technology being introduced within the industry.
One of the biggest widespread concerns of the innovations in automated retail is the elimination of jobs for till staff and other floor staff. This has been one of the most talked about issues when it comes down to technology development in any industry. Retailers could realise the savings of running costs in hiring and paying their staff, which would be an amount that is likely to make the latest technology extremely appealing - resulting in many job losses.
With the UK's retail sector consisting of around 2.9 million employees mostly aged between 16-25, it would definitely have a huge impact on redundancy rates in this age group. However, technology like Amazon's 'Just Walk Out' could actually create more work "behind the scenes" to ensure a seamless experience for consumers. It seems likely that it would create high-wage and high-skilled roles, especially within the tech industry and IT industry.
Another concern relates to security vulnerability towards hackers. With the entire billing and payments process being controlled by technology, without any manual error-checking, it becomes a prime target for hackers looking to compromise the system. Not only are people concerned about this aspect, but many have also stressed about their own privacy. Since the store essentially tracks every move you make, what items you pick up, the aisles you go down and even how long you spend inside the store, all linking to one account - what else could they see?
Regardless of the various pros and cons that we see attached to the concept of 'cashier-less stores', the development of technology will only continue to grow as time goes on - especially when there's always a constant need to maximise convenience in the industry of retail. Over the years we have always seen a constant development within supermarkets and retail stores - whether that's contactless payments or self service checkout's, the want and need for the latest technology doesn't end.
"The UK is the most digitally savvy market because we love click-and-collect and we shop online a lot, I think the UK customers are hungry for this technology." - Miya Knights, Retail expert and author.
It's going to be interesting to see the shift of other companies as they decide whether to take on the 'Just Walk Out' technology and how it will transform the FMCG landscape as we already know it. With the likes of Morrisons already working with Amazon Fresh and their online grocery service, what other companies are going to immerse themselves in the world of technology?