Get in Line: Why Retailers Need to Buy Into Smart Store Automation

In today’s high-tech, high-touch world, shopping in a brick-and-mortar store is as old school as it gets, right? Think again. From the nearly ubiquitous self-serve checkout stations at grocery stores to new cashier-less store technology, in-store automation technology is transforming nearly every aspect of the traditional retail experience.

Retail automation isn’t a new concept, but the technology that enables these “smart stores” is becoming more mainstream than ever before, and consumers are embracing it. In fact, a recent Capgemini study on smart stores revealed that 66 percent of consumers believe that automation can improve their shopping experience.

The good news is that companies don’t need to have an all-out automation strategy. There are many ways to incorporate automation into stores, and even relatively simple implementations can yield impressive benefits for both customers and companies.

From Painful to Personal

Anybody stepping into a store on Black Friday (or considering recent events, this past March) knows what comes with that territory: long lines, out-of-stock merchandise, and overworked or unavailable sales associates.

This frustrating experience is often not limited to major shopping holidays. However, automation technology can reduce these pain points and help to deliver fast, easy and personalized in-store experiences.

One might think it’s hard to get more personal than having a sales associate on the floor talking directly with shoppers. However, technology has the advantage of giving the customer more control over the experience. With the right technology implementation and supporting operations, the customer can choose how much they want to engage, how long the transaction should take, and even how they want to pay — whether via their own device, a touchless option (e.g., voice or facial recognition), or the swipe of a finger.

It always comes back to the experience. Consumers have always wanted shopping to be seamless, convenient, and enjoyable. In today’s changing environment, they also want it to be safe. Automation provides value to the consumer because it checks all these boxes. Not only does it make customers happier by removing frustration, it provides plenty of opportunities for retailers to create a more immersive, enjoyable and safe experience.

Imagine, for example, a shopping experience that allows the customer to avoid touching surfaces in-store, but still enables them to get the product information and help they need. Perhaps they can even check out using their mobile device, voice interfaces, or other automation technologies.

By taking advantage of these new automation tools, retailers can make their stores more efficient, interactive and engaging — with the ultimate goal of providing the most memorable customer experience possible.

Unexpected Rewards

From a purely business perspective, more rewarding shopping experiences lead to more revenue. According to Capgemini’s recent study on smart stores, consumers reported that they're likely to spend as much as 21 percent more time in stores that have compelling automation functionality. And new Capgemini research exploring trends in contactless customer experience shows that 62 percent of consumers expect to increase their use of touchless interfaces.

Additionally, there are other important sustainability benefits that are important to more than half of consumers. Simple automation steps, such as emailing receipts to customers rather than printing them, can considerably reduce paper waste. Indeed, 63 percent of consumers prefer to shop with retailers that reduce the need for consumables.

Facilities management presents another prime opportunity to lower carbon footprints. For example, internet-connected sensors can regulate in-store lighting, ambient temperature and product refrigeration. These regulations can deliver significant cost savings and environmental benefits as well.

Challenges to Consider

There’s no doubt that automation abounds with advantages, so retailers should be eager to roll up their sleeves and tackle implementation. Before initiating a plan, however, it’s important to be aware of potential hurdles and how to overcome them.

Customer Value

A big part of customer skepticism is unfamiliarity. When self-checkout was first introduced for grocery and general merchandise stores nearly 15 years ago, many consumers initially weren’t too keen on the change. Their reticence was understandable: The systems were often plagued by technical and process hiccups that needed refining. Moreover, it was a completely new type of experience; many consumers saw it as a lower level of service when compared to interacting with a live person at the checkout counter, and they didn’t readily see the value in the new-fangled technology. This is a genuine concern that retailers should take to heart. It’s worth noting that 63 percent of consumers feel retailers implement automation technologies only to cut costs rather than to improve the shopping experience. Therefore, when introducing any new technology into a retail environment, education must be a top priority.

Unchartered Territory

Despite the range of benefits from reduced costs to enhanced customer experience, our study found that surprisingly about a quarter of retailers are actively working on implementing store automation, and between 33 percent to 40 percent plan to include this technology within the next three years.

Why are retailers moving so slowly, and will recent events encourage accelerated adoption? Many retailers prefer to start small and then test, so they might be doing a pilot in a single area but don’t yet have the top-down strategic directive to implement a broader implementation.

Smart store automation offers a wealth of exciting new opportunities for retailers to not only reduce costs and improve employee productivity, but it can also serve as a differentiator and encourage businesses to be more sustainable and to reimagine their entire customer experience.

Shannon Warner is a Capgemini Invent consulting partner leading the retail, consumer products and distribution sector for transformation advisory in North America.