7 Retail Automation Takeaways From Our Recent Webinar
Retail web channel OmniTalk recently hosted one of their Ask an Expert webinars that tackled a question on many retailers’ minds: How do you actually digitize a physical store, and what do retailers gain from automation? The live video event featured hands-on retail automation experts Anika Vooes, chief acceleration manager at Rewe Digital, Nitu Kaushal, managing director, cloud first intelligent edge business, Europe region at Accenture, Andre Bechtold, SVP & head of solution & innovation experience at SAP, and Trigo CRO Guy Yair.
You can watch the full session here.
Here are 7 key takeaways from the webinar:
1. Store automation: It’s not about breaking tech barriers, it’s about customer experience.
Retailers are racing to implement new technologies and infuse their stores with innovative experiences. Like everything else in retail, to do it right, the focus should be on the customers’ experience: which emerging technology is going to really move the needle where it matters and improve core in-store experiences like checkout lines and product variety and availability.
As SAP’s Andre Bechtold put it, this is the era of experiential retail, and stores are “no longer points-of-sale, but rather, points-of-experience.”
According to Nitu Kaushal of Accenture, one of the positive outcomes of an increasingly automated retail environment is the shift it enables in the retail labor model, towards roles that improve customer service. Digital should allow associates to have live interactions with customers, and retailers to personalize the shopping experience, she said.
2. Computer vision AI is at the core of physical store digitization.
“Without computer vision, (retailers) could not imagine most of the processes that we can automate today. Whatever software we build, without computer vision capabilities it’s not possible to automate the processes in a physical store.” -Andre Bechtold, SAP
According to Nitu Kaushal, her team at Accenture views computer vision as the foundation on which store digitization is activated. “Computer vision traditionally is about seeing, it’s about observing, it’s about recognizing,” she said. Add to that advanced AI capabilities, she said, and you are unlocking many data analysis functions that can transform store experiences.
“You are creating that new front-end store experience,” Nitu said. By collecting store data, retailers can drive new personalized experiences, “so essentially you are creating a much stickier consumer base overall, which is what the industry really needs.”
3. Automation ROI – it’s not (just) what you think.
Yes, return on automation investment come from reducing dependencies–and costs–of cashier labor, but the panelists also highlighted reduced shrink and sales uplift, better space utilization, and more efficient store operations as additional value streams of computer vision-powered automation.
Retail space digitization that is based on computer vision is as much about data and operational efficiency as it is about frictionless checkout. Having the right process for how to leverage this newly captured data is key, according to Nitu Kaushal. “Unlocking those data insights fully end-to-end on the enterprise level is a really important area for us because this is really where we see that the retailers can sell micro insights back to their suppliers,” she said. “They’re able to change their experience of their consumers. They’re able to do so many more things than they were able to do before, and also empower their employees with the right data insights for them to add value back into the store experience.”
4. When piloting new tech, your choice of store matters.
Trial, and even, on occasion, error, is vital to innovation. But retailers are sometimes apprehensive about the work and costs associated with testing new tech, and the impact such experiments could have on shoppers’ experiences, shrink, and revenue. That is the reason some retailers choose to pilot new technology at a test store instead of a public point-of-sale. But REWE’s Anika Vooes, who has already collaborated with Trigo to open four computer vision-powered smart stores, thinks it is the wrong decision.
“You never learn as much from a lab store as you do in a real store,” she said. “We wanted to test it in real-life conditions, with real customers who behave so differently from your employees, and with the real challenge of keeping store processes working alongside the technology.”
If you test at a lab store, Anika said, you only prove that the technology works in a perfect environment.
To minimize the impact should their first Trigo trial prove unsuccessful, Anika said, the REWE team selected a small location. “We did not have big expectations on what the technology will be able to do,” she said. “And then we started with accuracy levels that just were beyond our expectations, and we were able to get these accuracy levels up so quickly. And since then, we see it improve and improve, and we’ve grown from a less than 200 sqm store to now roughly about 600 sqm, and from a tiny assortment of 2000 items to now having 13,000 SKUs.”
5. Scale requires the right business model and change management
According to Nitu Kaushal, the large capital investment currently required to build or retrofit a smart store is a considerable barrier to entry for many retailers, but it does not have to be. Retailers, she said, can work with partners like Accenture to create a new OpEx business model for store automation rather than having large CapEx outlays on day one.
To scale successfully, Nitu said, the numbers must add up, but another key consideration is change management. “There’s a real cultural shift here – on the consumer experience side, and also a cultural change on the employee experience,” she said, adding that for retailers to successfully retain and reinvest talent, they need to demonstrate the ability to upskill and create strong career paths.
6. Adoption cannot be taken for granted.
The fact that grocery shopping is extremely habitual has made adoption a formidable challenge, according to REWE’s Anika Vooes. Having quickly gained confidence in the technological capabilities of computer vision store automation, she and her team recognized the need to shift much of their focus onto designing the right user experiences to encourage adoption. “We wanted to find out if this technology is suitable for changing the way people shop,” she said.
According to Trigo’s Guy Yair, adoption is powered by trust. “To support adoption by shoppers, we need to give them the confidence and the trust in the technology. And the best way to do it, and this is one of our lessons learned as technology providers, is that we must deliver the receipt before they leave the store,” he said. “Up until now, the industry was focusing on delivering the receipt after shoppers leave the store. We call that offline experience.”
“Getting a receipt in real time instantly as you check out of the store, that is one of the game changers we see in the market,” Nitu agreed. “This increases customer confidence and loyalty because they know that they have paid for what they have taken from the store. And therefore it increases their return visit as well.”
Another critical factor, according to Guy, is freedom of choice when it comes to payment. That is why, he said, Trigo supports multiple checkout methods including app, credit card, and cash.
7. When working with tech partners, this golden rule applies: sharing (data) is caring.
According to Anika, retailers entering an automation project must be prepared to work with tech providers as “true partners” and share information with them. “I think partnership is one of the core aspects when you’re working on innovation,” she said, adding that her team speaks with tech provider Trigo weekly. “That is how you arrive at game-changing ideas,” she said.
Big corporations, she said, tend to be hesitant about sharing information. But “opening up and sharing your insight really openly, being transparent with your partner and learning together… is how you really grow together.”