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Dec 7, 2017 | 4 minute read
written by Harry Chemko
A bad checkout experience can lead to an abandoned cart and a tarnished brand image. Surveys show that 70% of customers get irritated by slow or chatty cashiers, and 49% hate seeing closed lines at peak hours. Keep them waiting for 2.5 minutes, and they get annoyed. Keep them waiting for 5 minutes, and half will just leave the store – and likely never return. (Retail Customer Experience).
Retail companies have tried to manage this pain point with barcodes, RFIDs, and self-checkout counters. But why not eliminate the checkout altogether? Here are some ways leading companies are using checkout-less shopping to create a frictionless shopping experience.
“When checkout is working really well, it will feel like stealing,” says Michael Chui, a partner at the McKinsey Global Institute. And no ecommerce technology comes closer does that better than checkout-less shopping.
Take Amazon Go’s “Just Walk Out” shopping experience.
You log into the app, enter a brick-and-mortar store, get what you want, and leave. What kind of sorcery is this? It’s the same artificial intelligence and machine vision found in self-driving cars. Sensor technology and video scans track your movement across the store. The data is synced with the handheld device, and when sensors (and face recognition) confirm you’ve left, the items are added up like in any other online shopping cart. You are charged based on your preset payment preference, whether that’s a credit card, PayPal, Apple Pay or bank account. This requires set-up on the part of customers, so they will likely only do that for stores they visit regularly.
As early as 2013, Walmart’s wholesale division, Sam's Club already had a “Scan and Go” app that let customers scan product barcodes and then pay at a special fast lane. With the 2016 update, people can pay straight from their phone. Within seconds, they receive an e-receipt to show to the “greeter” at the store in order to exit.
Sam’s Club still has traditional cashiers, but the app is useful for skipping lines especially during peak hours. Between shopping trips, the app also notifies customers about promos and sales related to their preferences and/or previous purchases. The traditional cashiers allow customers not yet enabled for a checkout-less experience to still spend at Sam’s. As they see the convenience of checkout-less shopping, they may convert over, and cashiers can help with that conversion.
There may be no way to completely eliminate lines because there will always be people who won’t have the right app. These people will still need POS systems, but not necessarily a human cashier. And the corner grocer (unless it’s a 7-11) won’t have the $ required to set up the technology necessary to facilitate checkout-less shopping so there will be lines there too.
Pay for a meal without even opening your wallet. Apps from companies such as Chipotle, Taco Bell and Starbucks take your order and process the payment in cloud. Your food or drink is ready when you arrive at a dedicated pick up point, and the only thing you need to do is eat.
Google also launched its “Hands Free” payment in some restaurants in the California bay area. Customers can order, and just say “I’ll pay with Google.” Cashiers then verify your identity by asking for initials and viewing your picture. Some stores also have in-store cameras that snap a photo and verify your identity on the spot using facial recognition.
Checkout-less shopping doesn’t just change the way people pay for their items. The technology changes the customer experience and opens new marketing opportunities.
“Our current dominant payment technologies have separation between the shopping experience and the payment experience,” says Tom Davis, president and COO of CSCU and Payments Review. “Since these newer forms of checkout-less shopping can happen within merchant controlled environments, in-store experiences can be blended with online and mobile experiences. This not only has advantages for loyalty, but can provide valuable data for several other purposes including target marketing and reducing shopping cart abandonment.”
Video analytics can now monitor what you buy, and what you return to the shelf or leave in your basket. Sensors can analyze movements across the store: where you go first, which aisles you spent the most time in, what you looked at and left (and may be interested in getting during the next sale). This is similar to the insights gleaned from clickstreams—and a powerful way for retailers to create personalized, data-driven shopping experiences.
To find out more about cloud-based ecommerce technologies, visit elasticpath.com