We have a tendency to make predictions about the future. Many of us may still remember the bold prophecies that one day humans would no longer need to eat food: instead, we would get all the nutrition we need in pill form.
We are seeing similar predictions today: that soon, no one will need to drive a car, visit a shop – or even write a shopping list. Thanks to the wonders of automation, everything will be taken care of for us. But unlike yesteryear’s visions of the future, we now have the technologies to make many of these fantasies come true.
So, how close are we to a fully-automated retail experience – one that entirely removes people from the process of planning, ordering, selecting, packing and delivery of our groceries? Just as importantly: is this a future that consumers actually want?
Retail automation today
End-to-end automation of the retail experience seems within touching distance, and we certainly have many of the key systems already in place. It’s worth looking at these technologies’ current capabilities to see how close we are to the dubious dream of fully-automated retail.
Most shoppers will be somewhat aware that robots and software are involved in the complex logistics of grocery supply chains, ordering and fulfillment. Looking at the supply side – the most ‘invisible’ aspect of the process to the ordinary consumer – we have the futuristic warehouses of companies like Ocado, where thousands of robots pick and pack products like a scene from a sci-fi film, with not a human in sight.
Robots roll near-silently along rails, filling stacks of crates up to 20 levels deep, each doing in minutes what it would take a team of humans hours to achieve – and with a much higher degree of precision. These smart little trolleys can work 24 hours a day without a break (except to recharge), providing efficiencies undreamt of only a few years ago, and significantly speeding up the fulfillment process.
Moving to the retail environment itself, the last year has seen some fascinating developments in the way that people go about their daily shopping. There’s the much-hyped Amazon Go concept – the “checkout-less” supermarket where, thanks to a host of sensors and deep-learning technologies, shoppers can browse, fill their baskets, and leave without queueing up to pay.
Other challengers are taking the concept further. Bizarre as it sounds (and looks), Shanghai is beta testing a self-driving ‘corner shop’ called 24 x 7 Moby Mart where the store actually comes to you.
For all the genius involved in these technologies, there is one part of the fully-automated retail experience that hasn’t yet been properly cracked: removing humans entirely from the purchasing process. Teams of brilliant engineers are currently working on this problem – but is it an experience that consumers actually want?
Anticipation – the missing link
We’ve already become used to machines influencing consumer buying decisions – and more recently consumers have even come to rely on these technologies. Examples include algorithms that suggest products customers would enjoy based on previous buying or browsing behavior, or that make intelligent substitutions when their chosen item is out of stock.
What we’re less aware of is how retailers are able to use these technologies to boost customers’ shopping baskets with targeted promotions, or with subtle prompts to stock up on certain products that they haven’t bought for a while.
These algorithms are getting smarter all the time. Many will be familiar with Amazon’s tactic of offering a discount if they subscribe to its Prime service, but there are other ways to convert one-off purchases into long-term value. Voice or touch-based ordering features provided by devices like Alexa are about more than the user’s convenience: it is also a step towards being able to predict consumers’ desires and order automatically – or, at least, to prompt them to make a purchase based on their intimate knowledge of consumption patterns.
One example is the Amazon Dash Wand, which enables you to scan your near-empty shampoo bottle, which will then be automatically re-ordered – from Amazon, of course. What’s fascinating is that advances in machine learning and AI could soon use contextual and behavioral parameters to anticipate our needs. Using a wide array of information – from the recipes you research online to your brand preferences, your consumption patterns to the weather – technology could soon order your shopping without any input from you, the consumer.
These advances are unarguably impressive and spell a bright future for the retail industry. However, we’re finding that some consumers still prefer the reassurance of human interaction – and this need should not be ignored.
For instance, in 2015 Morrisons reintroduced human-staffed checkouts for small shopping baskets – a move away from the wave of automated, self-service tills that have swept the nation. It turns out that people quite enjoy their everyday interactions with the smiling, familiar checkout operator; advice from a knowledgeable shop assistant; or just bumping into a friend in the local supermarket queue.
So, while the way we shop might be becoming increasingly automated, retailers would be wise not to forget the power of people. With the future of retail nearly here, the real question is how to ensure it remains appealing and convenient for future consumers.
Associate Partner, Infosys Consulting
Manu Tyagi is an Associate Partner at Infosys Consulting and currently leads our customer relationship management practice across Europe. Manu has over 18 years of experience in the retail and consumer goods industry with a strong background in defining and solving complex business problems for leading clients. He leads, designs and delivers large, strategic business transformation programs across Europe. Manu is based in our London hub and is regularly featured in the media discussing industry trends.