Supermarkets have done well in terms of turnover in the corona era. Online ordering and delivery took off in a massive way. But innovation in stores is also continuing unabated in supermarkets. In the United States, Amazon trials with a smart shopping cart that keeps track of what you put in it and automatically checks out at the end.
Smart shopping cart
Amazon is working on a smart shopping cart where the items you put in the cart are automatically added to the list of what you must pay. The car has a display and several cameras.
But it is not only Amazon doing these kinds of trials, also Kroger in the US and Edeka in Europe are piloting this kind of technology.
How does it work ?
According to Amazon, they use a combination of computer vision and sensors to recognize items that are put in the cart. Every item is automatically scanned when you put it in the cart. You go through a special checkout and you automatically pay by credit card. The carts are meant for small shopping trips, not so much for large weekend family shopping.
Another issue is, of course, groceries without a barcode, like fruit or items sold by weight. In that case you enter the article on the screen on the cart and the cart weighs it for you.
This sounds futuristic but I am not sure that we are going to see that at our local groceries. There are multiple reasons for that.
Self scanning
In the Netherlands, self-scanning is very popular, more than anywhere else in Europe. During the corona pandemic the use of scanners was higher than before. I do not have precise percentages (that is the secret of the supermarkets) but at shops where the scanner can be used without a loyalty card, it is going towards 50% of shoppers who use it. Even with a loyalty card an increase of 30% was seen because people wanted less contact with other people due to the pandemic.
Zebra for self scanning
In the Netherlands, but also elsewhere, Zebra is the technology provider for self scanning solutions to many supermarkets. The reason that they are not working on this is because the handheld scanner works so well, as well as the cost / investment involved with new carts.
A regular supermarket cart costs about 200 EUR, a smart cart will easily be multiples of that amount. And, of course, these need to be charged as well at one point. Scanners are deposited at the checkout in a charging wall and therefore always ready to go. In corona times of course after thorough cleaning.
More advanced deployments of Zebra (e.g. the Zebra PS20 Scanner), like the one at Jumbo even has Push to Talk Functionality to ask for assistance. If you have issues finding an item on the shelf you can push a button to talk to one of the supermarket’s employees to help you find it.
Data analytics
You might ask, aren’t the supermarkets afraid of people who do not scan expensive things? Theft is always an issue, but data analysis and random checks ensure that there is still a mechanism to catch people.
It could also just be a mistake, if you walk with two nagging children “I want candy!!!!” then your focus is always less. The algorithm for a random check is a secret that is well kept by the supermarket. However, at one point a supermarket manager instructed a cashier and inadvertently revealed some of the rules, specifically when they are going to call it shoplifting and involve the police.
And what about privacy? Supermarkets know what you are buying and build a database of client profiles. And that is true when it is linked to a loyalty card like Albert Heijns use of Zebra but the implementation of Dekamarkt is not linked to a card. How exactly the mechanism works is of course interesting but as said, that is the secret sauce.
Home delivery
Home delivery, by the way, has also grown significantly here in the Netherlands, so much so that Albert Heijn could not keep up with demand and quickly filled out delivery slots for the coming weeks. This is hard to scale since it needs humans to order pick, humans to drive and trucks to be driven. If you think that home delivery is something of the 21st century, you are wrong. The whole home delivery in the Netherlands started about 30 years ago already (with floppy disks to install a program for grocery shopping on your pc and a dialup modem to send the list over).
Options galore
Home delivery is going to take its share of grocery shopping but you need to have a specific amount of groceries in order to qualify for home delivery and of course a time slot for delivery. This does not do you any good when you are baking a cake but run out of butter. Some retailers are experimenting with 2 hour fast delivery, another option that might be interesting to shoppers. Pickup points and smartlockers are also popping up. The retailers need to see what fits from the perspective of their customers but also what they can support from a technical and personnel perspective.
Luckily, you have multiple options depending on your preference. You can go to the supermarket and get them yourself, with or without a self-scanning device.
Everyone must choose what suits him or her in terms of grocery shopping. If you know a very nice cashier, then especially check out your groceries with her or him.
Technology
In any case, grocery shopping involves much more technology than you might think. Let’s take the example of the Albert Heijn Self Scanning solution. I do not have detailed knowledge on their exact setup but it is not difficult to imagine the interaction with systems. When you present your loyalty card to the scanner a hand scanner is assigned to you (check to the loyalty database), your personal bargains are shown on screen on the scanner (data from a database), your shopping session is set to zero as well as the number of items in your cart or basket. When you scan an item it is added to your total and deducted from the inventory list of the store. I can go on but as you see, in the background APIs make sure that data is flowing from one system to the other. Not to mention the connection suppliers who, when they have the data about store purchases, can do just in time delivery. Connection between those systems could be using an Enterprise Service Bus functionality.
Human touch
The question is if this is a matter of technology push from Amazon. And are we now going to miss the conversation with that one nice cashier? Supermarkets are profitable because of high volumes and have razor thin profit margins. They are always looking for innovative ideas that improve client shopping experience and reduce cost. It is also a competitive market.
The question is, of course, is a Smart Cart going to be the solution? And when you talk about solutions, for whom? Is that the person who is shopping, to offer a superior shopping experience? Is the cart supposed to help the retailer, in this case, Amazon, by streamlining the shopping process, enabling more shoppers to visit, shortening lines at the checkout?
I do not rule out that this is largely a matter of gaining experience with the technology that Amazon has in house. Amazon is a tech company with a supermarket chain, Albert Heijn is a supermarket with good tech skills.
Whatever the goal is, innovation is going to continue to figure out how to make shopping more enjoyable, cheaper and faster. It looks like those three are at odds, and that is exactly the issue. How do we reconcile these three goals? An imbalance can prevent it from becoming a popular way of shopping.
But if you hit the sweet spot, you gain a big competitive advantage.
