Recently The New York Times ran a piece about the race for automated retail outlets to compete against Amazon. Amazon, of course, made a huge splash when it launched its first Amazon Go stores. Now today we learned that Amazon spent nearly $23B on R&D in 2017 alone. While the "automated selling" space is limited, for now, to retail and grab 'n go stores, it will only be a matter of time before other industries follow suit. As of now, the bulk of the automated retail experience is in Asia, however Wal-Mart recently began testing in 120 of its stores price scanning and checkout of items using a smartphone camera and the Wal-Mart app.
It will be interesting to see how the consumer demand for convenience and efficiency will be coupled with newfound outrage over consumer data protection. Of course, consumer data gathering and BI have been around since before customer loyalty cards, but adding true checkout features without the use of a loyalty card are only going to increase retailers' (and marketers') toolsets in more accurately predicting shopper behavior and targeting capabilities.
Let's take this one step further in a physical environment: if a shopper grabs an item, puts it in their cart and then removes it, either in favor of a competitive product or just not wanting it at all, the retailer has no knowledge of that. Because it wasn't purchased at checkout. But with self-scan technology, retailers will be able to track items scanned and then removed. This is going to give true insights into the consideration set of physical retail locations outside of (until now) methods such as observation of shopper interviews. Retargeting non-converted customers has been common in the digital marketing space for years. If a person exhibited certain behaviors (i.e. looked at a product but didn't put it in their cart, or went to a signup form but didn't submit), marketers could track that non-conversion (I like to call it an "almost conversion") and retarget with different messaging to try and convert. However, in a physical retail environment, retailers and marketers don't know if the person was looking at multiple products in the consideration set.
Now, you might say that people won't necessarily scan an item and then put it back, so retailers may not get that knowledge. But think of it this way: many online retailers today won't show the final price of a product until it is put into the shopping cart. As retailers begin automating the checkout process, and as shoppers change their behavior, there will be many more learnings than appear on the surface.
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Photo Credit: Giulia Marchi for The New York Times