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Three Ways in Which the Pandemic Disrupted Old-Fashioned Retail


Feb 25, 2022 - 9 minute read

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Wayne Swallow Independent Consultant

Wide-ranging Director level experience spanning 30 years in wholesale/retail, logistics, IT and operations. Wayne is a strategic Advisor with responsibility for new business across Retailer and POS estates, worldwide. A former MD of one of the UK’s largest Point-Of-Sale companies and previously the IT Director for Nisa Retail. Wayne brings a wealth of strategic and multi-faceted expertise.

See all Wayne's posts

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Table of contents

  1. Opportunities for Optimisation — New Retail Technology
  2. What Makes a Truly Unified Omnichannel Solution?
  3. Final Thoughts

For more than 140 years, the cash register has dominated the in-store checkout experience.  Invented in 1879 in Ohio, USA to help record and reconcile sales, the ‘till’ as it’s become known, has been a dominant fixture in the retail environment worldwide ever since. Perhaps until now.

There’s no doubt that it’s been a long time coming and, in many ways, it’s extraordinary that we’ve accepted doing things is such a cumbersome, antiquated way for so long. Imagine, in 2022, suggesting customers fill their basket, only to queue up to unpack it again, have it all scanned by a store employee, after which you have to pay, present a physical loyalty card then re-pack your own items before leaving the store! Taking this a step further, many of us write a shopping list and navigate stores with a paper list or, more often these days, a smartphone notepad or text message shopping list. In the age of 5G, automated vehicles, commercial space travel and a thriving e-commerce infrastructure, it’s extraordinary that in-store retail remains so antiquated and disconnected.

Although the market was ripe and poised for innovative change some time ago, with emerging pioneering technologies from the likes of Amazon (Just Walk Out) and Ubamarket (Scan, Pay, Go), it wasn’t until 2019 and the emergence of COVID-19 that things really started moving at pace. In fact, the pandemic had three distinct catalytic effects on in-store innovation. Firstly, it forced consumers to embrace technology in general, rapidly and universally — transcending generations (everyone and their grandmother was quickly comfortable with WhatsApp, FaceTime, Zoom and Teams, for example).

Secondly, customers were increasingly driven towards e-commerce as well as visiting smaller, local convenience stores for impulse buys, top-ups and emergency purchases like never before. Whilst in these stores, customers also got very used to social distancing and became increasingly conscious of not wanting to touch anything — and that included self-checkout screens. Thirdly, multiple lockdowns as well as stock and staff shortages put a huge strain on the retail sector, which is still the case today.

For all of these reasons an easy-to-use, reliable, affordable and scalable technological omnichannel solution seemed like the answer to all of the aforementioned problems.

But is it really, and is there even a truly omnichannel solution out there?

Opportunities for Optimisation — New Retail Technology

In a long overdue era of innovation, what is the best solution and what are the options currently available to retailers and their customers? What happens to existing hardware and legacy systems, and how do retailers make the transition? Is a hybrid approach the most viable and transitional way forward? How can retail groups combine in-store activity with e-commerce, and what about loyalty? Is loyalty even relevant in a fast-paced, automated world, or should AI and ML algorithms supersede it? And what about Click & Collect and home delivery? These are all crucial questions. In many ways, e-commerce has influenced the way we shop in store as well as online. It’s certainly made us more impatient and less tolerant of friction and obvious ‘pinch-points’ such as queuing, searching for items which may not even be there in the first place, unpacking items just to pay and re-pack, rummaging around for loyalty and payment cards, all topped off with a distinct lack of automated personalisation. 

In-store and e-commerce consumer journeys both have their individual advantages. In-store can be faster, much more convenient as well as more enjoyable and inspiring (popping into the local shop with a list and the ability to impulse buy and receive your items immediately is often far better than ordering online, waiting for a day (or a dreaded delivery slot) and risking several ‘replacement’ or even missing items. Yet, there are so many age-old in-store frustrations too. Imagine a world where you could leave the house with your phone; your most trusted device and the one thing you’d never venture far without, and being able to navigate the entire end-to-end shopping experience without having to touch anything or anyone. Creating your shopping list, navigating the store, scanning your items, receiving personalised offers and product information, verifying your age for restricted items, receiving loyalty points, seeing a running total of your spend, packing your items as you go and tapping to pay without queueing has surely got to be the Holy Grail of the in-store experience? For retailers, it reduces overheads, increases basket size and reduces reliance on expensive hardware and therefore legacy. The good news is that this is not only possible, but it’s also available and affordable.

In recent years, the leading, most viable solutions can be broken down into three distinct categories. Just Walk Out (JWO), Scan, Pay, Go (SPG) and improved Self-Checkout (SCO), including variations of that theme such as integrated SCOs with shopping carts (currently being trialed by Kroger) and basket-scan checkout (currently being pioneered by Uniqlo).

Amazon Go is clearly the most high-profile, pioneering brand for JWO technology, having launched their first concept store in Seattle in 2018 (and having now teamed up with Sainsbury’s for a trail store in London), but others like Tesco (in partnership with Trigo) and Aldi are now trialing alternative versions via a variety of specialist suppliers. Whilst this is highly innovative, it’s also very expensive, relying on high levels of physical hardware-based technological infrastructure (cameras, shelf sensors, entry gates, etc.,) and is also restricted by the limited number of products (SKUs) it can handle. Interestingly, JWO technology still relies on the retailer having an app as the consumer-facing registration, store entry and payment mechanism and this is often left to the retailer to create or source independently.

Other JWO systems currently suffer the same challenges and there are also occasional inaccuracies at checkout whereby items are missed. Age verification has to be handled manually too, of course. Customers are also often charged several hours later at busy times, so there’s clearly a long way to go before JWO becomes more mainstream, which in some shape or form, it inevitably will. Currently, JWO technology is most frequently deployed in sealed, stand-alone vending units or kiosks as this is a more manageable environment.

SPG is a different story and is fast evolving and emerging in more and more stores with varying levels of functionality and wildly varying degrees of success. Some of the larger retailers have attempted to build their own — Sainsbury’s being the most high-profile and successful, but also Waitrose, Asda, M&S and Lidl have all jumped on the band wagon. But are any of them any good, and are they doing what they claim to do?

The fundamental challenge with SPG technology is that it needs to be fully integrated with the store’s POS system and this isn’t necessarily a simple task. Systems that try to ‘go around’ the POS or rely on a ‘partial integration’ end up causing all sorts of stock reconciliation or real-time pricing errors. Therefore it’s so important to have an experienced technical partner to advise you and oversee both the integration and the ongoing operational aspects of the solution. On top of this, there’s a minefield of subtleties which must be considered around offers, multi-buys, loyalty pricing, reduced to sell, loose items, deli counter produce etc. In addition, if an app relies on a ‘live look-up’ of items as they’re scanned (as the M&S app does), it’s simply too slow and frustrating for customers to stick with. Of course, the scanner itself needs to be fast, accurate and somewhat forgiving, without being too sensitive because shoppers don’t want to accidentally scan additional items. These are all things that need to be considered and you tend to find that retailers who have attempted to build their own SPG solutions fall foul of many of these issues and end up in a never-ending, disproportionately expensive development cycle. The greatest challenge of all though with any new technology is uptake. Remember, the traditional till and queue system has been around for over 140 years, so it’s breaking the habit of several lifetimes which is a challenge, however good your tech may be. SCOs suffered the same challenges and still do today to a certain extent and their major flaw is the fact that the entire scanning process begins at the end of the shop, as opposed to incrementally as you shop, rendering it not much faster or easier than visiting a cashier and certainly more of a daunting prospect. Of course, at busy times, queues can even appear at SCOs too.

Click & Collect has certainly proved to be a ‘quick win’ for many retailers, particularly convenience stores during the pandemic. Various third-party suppliers such as Snappy Shopper (native app) and Appy Shop (web app) were able to quickly provide a solution which, although not always integrated with the POS, enabled retailers to trade in a hybrid technology based/manual capacity with orders coming in via the app and stores managing those orders outside of the technological infrastructure provided by the solution. Taking this to the next step, rapid delivery apps such as Instacart, GoPuff, Gorillas and Doordash, specialise in one-hour city-centre (or University campus) delivery, sourcing their products from participating local stores. One potential downside to this quick fix solution is that these (extraordinarily highly valued) third-party apps are technically collecting customer data and could then, in theory, service them directly in future, perhaps from ‘dark stores’ in much the same way Ocado does. It’s therefore a choice between quick outsourcing or investing in their own infrastructure. Perhaps the best solution is to offer both — an own-brand solution as well as multiple third-party solutions, to attract new business across multiple channels?

What Makes a Truly Unified Omnichannel Solution?

So, with all these separate options, what is the best approach for a truly unified, omnichannel solution? The retail app world is already hugely fragmented with many retailers promoting several different apps for several different disciplines — from loyalty to vouchers, payment to home delivery and none of them are linked or even integrated to in-store systems. This inevitably leads to confusion. A solution where everything can happen in one place — dynamic shopping lists, guidance, in-store product scanning, product information, loyalty, personalised offers and payment, as well as Click & Collect and home delivery, all without having to visit a till or utilise any hardware, is surely the most viable solution available today. The secret to this, though, is a fully integrated, unified approach where store systems, the POS and back-office all talk to each other in real time, creating a truly harmonious experience for shoppers and retailers alike — and the infrastructure required behind the scenes to make this happen is not to be underestimated.

Following a period of resistance, certain POS vendors and hardware manufacturers have now embraced the collaborative approach and have teamed up with specialist preferred suppliers to offer seamless omnichannel solutions for their retail customers. As SPG becomes more mainstream, retailers are increasingly leading with the consumer interface and are actively seeking POS vendors who can offer customer-facing technology to enhance and extend their service offering. The tables are certainly turning. 

It’s becoming increasingly apparent that not only is SPG economically viable and highly effective right now, but it will also evolve into something similar to JWO and may even form the consumer-facing interactive shopping list mechanism for JWO, creating a prolific hybrid solution. In any event, the beauty of SPG is that it can work with or without hardware and for that reason is a better, more affordable investment for the foreseeable future. What’s more, the ‘behaviour’ pattern data derived from SPG apps is highly valuable to retailers who want to attract and reward shoppers with touchpoints before, during and after their store visits.

It’s important to note that there is still very much a place for traditional tills and SCOs for the time being, and that the most effective approach would be to reduce the number of manned tills and SCOs whilst introducing an end-to-end omnichannel SPG app to work in tandem, migrating customers incrementally from the older mechanisms they’re already used to and giving them access to a far more informative, frictionless mechanism. Statistically 75% of people who use the SPG app use it again, and this number is clearly set to increase as the process becomes more mainstream (Ubamarket 2021). Another benefit of SPG is that it can happily operate in tandem with existing store systems.

Final Thoughts

In summary, whereas before the pandemic we were often referring to ‘the stores of the future’, we are now very much immersed in the ‘technological stores of today’. These technologies are becoming more mainstream each day as well as being both affordable and proven to remove friction for the shopper, whilst reducing operational overheads for the retailer.

There is no doubt that stores will become increasingly autonomous and data-driven, and that retailers and POS vendors who embrace this notion will future-proof themselves in a rapidly evolving marketplace where hyper-personalisation and a frictionless experience will become increasingly expected by customers.

2988 HC Digital Transformation 476X381
Wayne Swallow Independent Consultant

Wide-ranging Director level experience spanning 30 years in wholesale/retail, logistics, IT and operations. Wayne is a strategic Advisor with responsibility for new business across Retailer and POS estates, worldwide. A former MD of one of the UK’s largest Point-Of-Sale companies and previously the IT Director for Nisa Retail. Wayne brings a wealth of strategic and multi-faceted expertise.

See all Wayne's posts

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