Shop in the palm of your hand. How retail around the world got smarter
Traditional stores are becoming more user-friendly and responsive, going online and looking for new tools to attract visitors. Mikhail Gleba, CTO at IXR, a developer, integrator, manufacturer and supplier of complex digital solutions for retail, talks about what innovations and trends are affecting the development of international retail today.
Stopped in, took and left
Retailers around the world have been testing the smart store format without sellers for several years. Leadership in this area has been secured by the American Amazon Go network. You can get into such a supermarket by registering in the application of the same name and linking a bank card to it. Then the buyer can safely put the necessary goods in his pocket or in “smart” carts. Thanks to the presence of cameras based on computer vision and sensors both inside the baskets and throughout the store, any action with the product will not go unnoticed. When the customer leaves, the store automatically debits the money from the account.
The growing interest of American buyers in this format becomes sufficient reason to increase the number of chain stores, according to Amazon. According to a Piplsay survey, almost 60% of consumers want to see such a store near their home and see the expansion of the network as a threat to such large retailers as Walmart and Kroger. By the way, Walmart has already announced its readiness to transfer stores to a full-fledged self-service scheme by the end of 2021.
In Asia, Japan plans to strengthen its influence in the offline store market. Local chain FamilyMart announced the opening of thousands of unattended convenience stores by 2024. The first test store has already started operating in Tokyo.
Even though it costs 20% more to open a standalone store than to open a classic store, the costs pay off by reducing labor costs. Japan, by the way, has long faced a labor shortage due to an aging population. In contrast, in China, there are enough resources, so projects with automated stores never took off. In general, according to the Japanese, the opening of standalone stores can be a good idea for “unprofitable” areas where the emergence of conventional supermarkets is not economically feasible.
In South Korea, stores without staff are still being tested by large telecom companies: SK Telecom, KT and LG Uplus. This format allows visitors to shop and pick up items late or around the clock, like the LG Uplus store in Seoul. At this point, the client can independently become a subscriber of the company or purchase gadgets, having received a QR code for the desired service remotely in advance.
The trend for the development of remote services was picked up in Europe as well. The sports network Decathlon in Germany has launched a self-scanning system for goods using Scan, pay, leave phones. Thus, the business is striving to reduce contacts between buyers and cashiers in a pandemic.
Show your "face"
The use of biometric data in retail (bio-acquiring, customer identification and others) is a separate actively developing global trend that is becoming a part of everyday life. According to Google AI experts, by 2023 more than 2.6 billion users worldwide will use the pay-with-a-glance format.
For example, in China, buyers are required to go through a face scan when purchasing a SIM card. In addition, since last year, a recognition system has been launched in local pharmacies, which prevents the sale of certain categories of drugs to unwanted persons.
In Russia, the interest of retailers and their partners in biometrics is also high. Bioequiring services are introduced not only by retail chains (Perekrestok, Magnit), but also by coffee shops: a recent example is CoffeeBean in Moscow.
In addition to biometrics, the business is also developing the direction of payment by QR code. This service is especially popular in China and South Korea. In Russia, interest in it is also growing: now QR codes are generated on many payment receipts. But Sberbank went even further by implementing the Pay QR service, which allows accepting payments without using a bank terminal. Retailer Wildberries has also released an app that allows you to pay for purchases using a QR code through a fast payment system.
When cameras know everything about a store
Russia ranks third in the world in terms of the use of CCTV cameras in retail. The share of "smart" cameras with video analytics is at the level of 10-15% today, and this figure will grow. Such systems are able to compose a portrait of a buyer, analyze his behavior and solve business problems.
A successful case of using this technology belongs to the American retailer Walmart. He has built an Intelligent Retail Lab (IRL) from one of his supermarkets, which includes a network of AI-enabled cameras. The system informs the store employees about the availability of goods on the shelves and when the stock of products needs to be replenished.
Face recognition technologies built into the cameras allow you to expand analytics capabilities: you can count unique visitors - evaluate the "return" of specific customers and exclude employees from the sample. Thus, with the help of M.Video cameras, it was possible to track lonely visitors who need help in the hall.
Do customers really need innovation?
Perhaps, if not for the pandemic, retail would not have made a rapid technological revolution in a short time. Rapidly changing conditions also affect the buyer's decision-making process. If purchases can be made quickly and safely, this is perceived by society only positively.
Surveys confirm that an average of 50% of shoppers worldwide use contactless payments - a figure that will increase by 30% in the near future. Approximately the same indicators are accounted for by supporters of ordering through apps, slightly less (44%) by social networks.