Is the retail future checkout free?

Is the retail future checkout free?

7-Eleven has become the latest Australian retailer looking to make the retail experience checkout free, with the trial of a new app that allows customers to go “cardless and cashless”.

Announced last week, the trial follows in the footsteps of grocery retailer Woolworths and of course Amazon Go in the US.

The 7-Eleven trial is also raising major questions about the future of retail. So, let’s examine who’s looking to eliminate the checkout and which verticals are more likely to embrace checkout-free convenience.

The 7-Eleven trial

Announced on May 29, the 7-Eleven trial is being held at their concept store in Richmond and sees customers pair their cards with a smart phone app, scan items using their camera and simply walk out.

The cardless and cashless concept has been in the works for the past 12 months, and according to 7-Eleven CEO, Angus McKay will help eliminate queues while allowing staff to focus more on customer service and the retailer’s growing food offering.

“Nobody likes to wait, so eliminating queues was part of the mission for this mobile checkout,” Mr McKay explained.

“The store feels more spacious and customers avoid being funnelled to a checkout location creating a frictionless in-store experience.”

The trial is being used to fine-tune the experience, with no specific timeframe for when it might roll-out on a larger scale.

Meanwhile, 7-Eleven told Inside Retail the likelihood was cardless and cashless would be implemented on a larger scale alongside more traditional payment methods, rather than being the only way to pay.

And 7-Eleven isn’t the only one trialling a cashless system.

Others trialling checkout-free

In September last year, Woolworths became the first Australian retailer to trial the checkout free concept at its Double Bay location in Sydney.

Like 7-Eleven, the system relied on a dedicated app that allowed Woolworths Rewards members to scan product barcodes with their smartphone and pay for them using an app linked to their debit or credit card.

The technology is different to Amazon Go in the US where customers have a dedicated app but aren’t required to scan items. Instead they scan the app on entry and simply walk around the store selecting items that are added to their cart and automatically paid for as they leave.

Amazon’s approach utilises a combination of images, weight sensors, and input data that identifies products and determines when they’re removed from the shelf, adding items to a virtual cart as the consumer shops in the store.

Who’s going checkout free

At the moment, the checkout-free experience is being explored by retailers where convenience is key, and others have been watching on with interest, as Smart Company recently noted.

“Where a product is high volume, low human touch, I think this technology will do well,” chief executive of the Retail Doctor Group, Brian Walker told Smart Company.

He further noted convenience stores, general merchandise retailers and discount department stores would be the most likely beneficiaries of the technology.

This opinion was backed by University of Tasmania’s Louise Grimmer, who noted convenience was a competitive landscape.

“Retailers of all sizes will be watching this development very closely and paying attention to customer reaction to this type of technology,” she told Smart Company.

“As the technology becomes more commonplace, it will become cheaper and more cost effective for retailers of all sizes.

“We will see more and more of this type of approach to providing the most convenient shopping experience for customers.”

The checkout won’t be replaced entirely

While more and more retailers look to lower their labour costs and explore a checkout-free future, many experts agree it’s not likely to replace the traditional checkout entirely.

In the US, for example, certain cities have even outlawed stores that are completely cash and card-free, with the view cardless and cashless payment options discriminate against consumers who don’t have a smartphone or online account with the retailers that operate them.

Meanwhile, Ms Walker told Smart Company not all retailers would be suited to the checkout free experience.

“You aren’t going to buy a Louis Vuitton jumper by scanning with your phone,” she said.

“Shoppers who don’t have smartphones or who aren’t confident using this type of technology will still prefer to shop in the traditional way.”