It’s a sign of just how quickly things are evolving in retail technology that no one bats an eyelid at the idea of ‘check-out free’ stores anymore. The first Amazon Go store, the pioneer of the ‘Just Walk Out concept’, was launched in beta form in 2016, before opening its doors to the public in 2018.
Since then, the Amazon Go model has since made it to the UK in the form of Amazon Fresh convenience stores, while Tesco has also dipped its toe in the market. As have Sainsbury’s and Aldi. As with lots of innovative new technologies, there has been a lot of hype around what is undoubtedly an intriguing concept. And a lot of suggestions that this might be the end of POS ‘checkouts’ as we know them.
But is that really the direction we’re heading in? The slow rate of roll-out is one reason to question if the future is really checkout-free. While plenty of people will have heard of the concept, not many have yet had a chance to try it out. Five years on from the technology being launched, there are still less than 20 Amazon Fresh stores in the UK, while Tesco, Sainsbury’s and Aldi have only launched one each so far. All of them in London.
For a technology that some argue will define the future of retail, that seems slow progress. Why might that be the case?
Giving customers what they want
One argument is that it’s far from clear that checkout-free is what consumers want – at least not at the expense of having other options as well. A GlobalData Consumer Views Survey in late 2021 found that 55.7% of UK shoppers said they wouldn’t use a checkout-free store even if it was in a convenient location for them. The biggest factor putting people off was the requirement to download a dedicated app to use such a store.
Another survey carried out a few months later by Sensei and the University of Edinburgh Business School found that 60% of UK shoppers were open to the idea of using checkout-free technology – but on the proviso that it was part of a ‘hybrid’ offer that also included more traditional POS solutions.
This stands out as a crucial point. Across the board with purchasing options, consumers make it clear that they don’t want to be dictated to with single options. They want choice and flexibility. They want online and physical stores. They want self-service and real people they can get assistance from. So we should not be surprised if they want checkout and checkout-free, too.
We can see clear examples of why this might be the case in the convenience sector, which is where the first forays into checkout-free have been made. Convenience retail seems perfectly suited to checkout-free technology. What could be more convenient than being able to walk into your local store, pick up a handful of groceries and walk straight out without any queuing or delays scanning in items to pay?
But there are equally obvious exceptions where this wouldn’t work for all convenience store customers. Small purchases of snacks or a newspaper are, for example, where lots of consumers still like to use whatever small change they are carrying with them. ‘Just walk out’ stores are cash-free, which alienates a lot of customers. And then there is the issue of regulated goods like alcohol, tobacco and lottery tickets, which make up a significant part of convenience store trade.
The key takeaway is that, despite the inevitable hype, the latest retail technological innovations do not as a matter of course offer the most convenient and flexible options to consumers. If you look back at the recent history of POS innovations – kiosks, mobile POS – the new arrivals haven’t come along and replaced what has gone before. They have simply offered a different option, increasing flexibility through choice. You could say the same about the relationship between ecommerce and physical retail.
You don’t need to look any further than consumers’ own opinions to understand how much they value choice in the retail experience. And they do not appreciate one-size-fits-all solutions. As we have seen over the course of five years now, single option checkout-free stores have been pretty slow to take off, and have been restricted to a single retail sector. Whether the concept survives and thrives therefore likely depends on how well it can be incorporated to complement existing POS solutions.