Brick-and-mortar retail is in a technology boom. While innovations like self-checkout, mobile apps, and digital kiosks were already popping up in stores, the pandemic only accelerated the adoption of new technologies to connect with customers and keep them safe.
Despite focusing on face-to-face interactions and physical products, brick-and-mortar retail’s past is filled with technological innovation — though we may not think of them as such because they're so ingrained into the shopping experience today. Here's a look at some of the inventions that have shaped retail's history, and some innovations that will shape its future.
Up until the invention of the cash register in 1879, storekeepers kept a record of sales in a ledger — and if the sale wasn't recorded, it wasn't tracked. Saloon owner James Ritty knew he was losing money from unrecorded sales and dishonest employees, so, inspired by a mechanism that tracked the number of revolutions of a ship's propeller, he created a machine to track sales: the cash register. This new way of tracking sales, inventory, and loss allowed merchants to keep much more accurate records — and it’s only been improved upon since.
While purchasing goods and services on credit has been a practice for ages, having a physical card to use is a fairly recent invention. The first credit cards were issued in the early 1900s by individual stores to their customers, and could only be used at that individual store. Issued in 1950, the Diners Club card was the first credit card that consumers could use at a variety of locations. The first bank-backed credit card was issued in 1958 by Bank of America. Today, consumers use a credit card for nearly one-third of their purchases.
Barcodes and SKUs
As stores continued to grow in the mid-20th century, retailers were faced with a problem: with so many products on the shelves, it was taking cashiers a long time to ring up every item manually, causing long lines and frustrated customers. Based on Morse code, Joe Woodland designed a way for each product to be labeled with a unique code that could simply be scanned at the cash register. On June 26, 1976, the first UPC code was scanned — attached to a pack of gum — and the technology that would lead to inventory tracking systems to allow retailers to scale was born.
Based on Radio Frequency Identification (RFID) technology, the first contactless payment was the Mobil Speedpass, launched in 1997. Users could wave their Speedpass — a fob on their keychain attached to their Mobil account — across a sensor at the gas pump, and pay without having to swipe a card. This was the basis for our ability to wave our cards, phones and smartwatches at checkout today.
Technologies of Today and Tomorrow
Technologies evolve to not only streamline the shopping experience, but can add value, fun and engagement as well. We've seen quite a few technologies develop for brick-and-mortar recently, many of which are positioning retail for the future.
One of those technologies is self-checkout, where customers can scan and pay for products on their own. Adoption has risen dramatically in recent years, and in our 2021 State of Self-Checkout Experiences report, we found that nearly half of respondents (49 percent) said they use self-checkout all the time. Taking self-checkout to the extreme, Amazon Go stores allow customers to simply shop and leave, as sensors pick up what they've added to their cart and charge it to their Amazon account.
Self-service options are also becoming more prevalent as well, as customers can use self-service kiosks with interactive touchscreens to help find products in-store. Self-service kiosks also give customers the option to bypass long lines in busy cafes and place orders themselves.
Retailers are also leveraging augmented and virtual reality in order to create more engaging in-store experiences, too. Customers can scan a product label in-store and learn more about that product, or use AR to have an in-store scavenger hunt. The North Face has pioneered VR in its stores to bring customers into the outdoors and give them virtual hiking, base-jumping or climbing experiences.
Finally, we're seeing robots and artificial intelligence move from warehouses and back-end areas of retail to customer-facing usage. AI is appearing in smart stores like the aforementioned Amazon Go, as well as in clothing and make-up retailers' stores where "smart mirrors" will make suggestions on new products based on the customer's appearance. Retailers are also using robots to help with delivering great customer service, like Pepper, a California mall robot that chats with customers and answers their questions.
Embracing Technology for Brick-and-Mortar's Future
From small innovations to large ones, technology can provide a more engaging, streamlined experience for customers in your brick-and-mortar stores. Retailers looking to continually grow their business and engage their customers into the future should build on retail’s past by embracing and implementing new technology for great in-store experiences.
Read more about brick-and-mortar’s history, present, and future in The Experience-Driven Business.
Bobby Marmahat is the CEO of Raydiant, a digital signage and in-store experience solutions provider.
Bobby Marhamat is the CEO of Raydiant Screen Signage, a digital signage provider that helps businesses turn their TVs into interactive signs that drive sales, improve the in-store experience, and reinforce brand messaging. Prior to joining Raydiant, Bobby served as the COO of Revel Systems where he worked on the front lines with over 25,000 brick and mortar retailers. Bobby has held leadership positions including CEO, CRO, and VP of Sales at companies such as Highfive, Limos.com, EVO2, Verizon Wireless, LookSmart, ServerPlex Networks, and Sprint/Nextel. When Bobby's not spending his time thinking about the future of brick and mortar retail, you can find him traveling, reading, or tending to his vegetable garden.