Does retail automation signal the end of personalisation?

David Buckingham is CEO at Ecrebo. David joined Ecrebo as CEO in March 2017 where he oversees the company’s global presence, international growth strategy and technology offering. With over 25 years’ experience within the retail and CPG insights and analytics space, David has held senior leadership positions at leading retail insights and analytics providers including Kantar Retail, IRI, Loyalty Management Group and i2c. Prior to joining Ecrebo, David was President of Aimia Shopper Insights in New York, where he headed up its North America division.

Over the last two decades, technology has changed the face of retail, from the in-store experience and the payment process, to the advent of ecommerce and omnichannel retailers. But much as technology has revolutionised the shopping experience, it has also had a significant impact on jobs in the retail sector.

As far back as 2016, Deloitte predicted that 60% of retail jobs would be automated within the next 20 years. While this estimate is not disputed, some experts believe that these jobs wouldn’t necessarily be lost, but would instead evolve. Regardless of the sentiment, it’s clear that the likes of artificial intelligence, robots and automation are transforming the retail industry. And one of the most notable examples of this in action has been the cashierless store.

Cashierless stores, more convenience, less human interaction

The concept, pioneered by Amazon in the U.S. back in 2018, allows shoppers to select their items in-store and then pay for them via an app. The entire process is automated, meaning shoppers walk out of the store without ever having had to interact with a member of staff or use the checkout to pay for their goods.

Having now rolled out more than a dozen Amazon Go stores across Seattle, Chicago, New York and San Francisco, Amazon is also reported to have secured a UK site in London.

The benefits for shoppers are clear – convenience and speed. No queues and no waiting. And retail’s increasingly tight margins mean that anything that improves the shopper experience yet saves money at the same time means retailers are onto a winner with this approach. It’s no doubt then that cashierless stores are on the rise, having already spread to the UK (Sainsbury’s), the Netherlands (Decathlon), Canada (Walmart) and China (Bingobox). Unwilling to risk being left behind, recent reports suggest Tesco has partnered with a start-up that uses artificial intelligence to deliver checkout-free stores – and could well be next in the now-obsolete queue to go cashierless. In fact, 28% of retailers that responded to an IDC survey are testing cashierless technology, according to The Wall Street Journal.

So, on the face of it, everyone’s happy. But, crucially, what’s missing is the human touch.

According to PwC research, 75% of consumers say they would actually like to see more interaction with store staff as technology advances. So much as it’s a convenient way to shop, it completely removes human interaction from the whole shopping experience, making it purely transactional.

The balance between technology and personalisation

This presents a conundrum for retail marketers when it comes to how they can deliver the best customer experience in-store using personalisation. Even though retailers are removing human interaction from the equation, marketers still need to know their customers, understand their needs and behaviours, and engage with them in meaningful, relevant ways.

So how can retailers, and marketers specifically, overcome this challenge?

The answer lies in data. To be able to shop in a cashierless store, shoppers need to first download an app which means retailers can collect a wealth of transaction data. This data can be used to leverage customer insights, such as how frequently the shopper is in-store, which items they purchased, and how much they spent.

So, rather than being a challenge for marketers, this actually presents an opportunity. Marketers can build up long-term pictures of their customers to better understand them. They can use these insights to develop targeted, relevant and personal offers based on their past and current purchases, frequency of visits and other insights gleaned from their shopping behaviour.

So, in addition to enjoying the convenience of cashierless stores, shoppers still get to experience the personalised element, helping to boost engagement and loyalty.

But despite these stores being ‘cashierless’, that doesn’t necessarily mean staffless. Customer service is still an essential ingredient of any retail environment, and often a key differentiator. Staff that would have manned the checkouts can be deployed elsewhere, assisting shoppers where needed, locating items within the store or being available if anything goes wrong. There’s also an added benefit; interaction between staff and customers actually helps create an emotional connection with the brand and helps build brand loyalty.

The retail road ahead

There is little doubt that technology will continue to transform the retail space. While there will always be a demand for both speed and convenience when it comes to the customer experience, the need for human interaction will also remain. The key challenge for retailers and marketers, then, becomes finding that balance between the use of technology and personalisation.

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Find out more about Digital Marketing World Forum (#DMWF) Europe, London, North America, and Singapore.  

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