The Future of Store Automation Post-COVID-19
Our march toward automation in retail has been severely dampened by COVID-19. The economic lockdown meant a massive rethink in how consumers get what they need, which stole attention from many of the novel solutions that were making their way to stores. Consequently, the rate of in-store implementations of (and investment in) new automative technologies has slowed, and it wasn’t just limited store access.
However, in challenge, there’s also opportunity, and today’s trials are no exception. Many of the current and evolving ideas in retail robotics will gain traction and grow based on how they can answer the specific needs imposed by COVID-19. Once the dust settles, retailers will once again be in the position to expedite the rollout of such technologies as robots and fixed cameras in stores, enhance online shopping, and even consider integrating fully frictionless stores.
In 2019 — prior to COVID-19 — online grocery shopping accounted for 6% of total grocery sales, and projected to be 8-9% in 2020. The pandemic provided a boost to online shopping, which is now hovering around 15%, according to 1010data. Whether this increase is permanent or if rates fall back to previous projections remains to be seen. Our data-informed projection is that the growth will not only be sustained, but will further edge upward.
Brick and mortar actually had an initial unexpected boost from shoppers early on in the pandemic who were eager to stock up due to the uncertainty ahead. As retailers feel the losses from decreased foot traffic, their chief motivation will be to recoup those losses rather than spend money on new technology.
Safety will be a new metric by which retailers will differentiate themselves and invite shoppers back inside their doors. But as retail, especially grocery, pivots to increased online sales, retailers will have to shift their attention to operations and procedures, to keep up.
One area of focus during the mega-shift to online is impulse shopping. It’s key for retail, and especially so for grocery. Although online retailers like Amazon have mastered the art of online shopping, with advertising on their pages to drive basket size, in-person shopping still notches up better rates of impulse purchases.
Grocery retailers can still count on the faithful shopper segment that enjoys visiting their local store to peruse its aisles, hand pick their own fruits and vegetables, and custom order their meats to prepare their weekly meals or curate dinner for a special event, and whatever else that happens to meet their gaze. Grocery shopping is an experience that many enjoy and look forward to.
However, despite this preference, in the face of a global pandemic overall in-person traffic at stores will remain lower. Even if shoppers are still purchasing their online groceries from the same local spot, online sales will continue to go up.
This is the advantage that Walmart leveraged against Amazon to earn the No. 1 spot for online shopping in 2019. This is also why Amazon acquired Whole Foods and continues to experiment with various brick and mortar store formats to increase its physical presence and boost share.
And the data show their strategy is based in solid science: Walmart’s online grocery market share was at 48% in 2019 and down to 34% in June of 2020, according to 1010data. Instacart’s market share was at 25% in 2019 and up to 44% as of June 2020, taking the lead in the market, also according to what we’ve tracked at 1010data.s
Despite these category-killing market players, however, there would be no online grocery shopping/delivery without your local grocery store or a micro-fulfillment center. As delivery windows start to narrow due to increased demand as the pandemic stretches on, demand will further increase, and competition will intensify.
Technology to the rescue
How will the shift to online shopping impact what was once a growing adoption of retail-based robotics? Will fixed cameras take over? I believe COVID-19 will slow down rollout in the short term, but we’ll eventually see demand for more robotics as retailers go frictionless as much as possible.
Certainly this type of shopping, which removes barriers to shoppers — one of which is now the risk of infection or too-close interaction with another person — is only more appealing now due to COVID. We will soon see even smaller retailers heading in this direction as well, and the rollout of fixed cameras will likewise be expedited.
This is stage one. Fixed cameras will take off, and robots will be promoted to picking products from the shelf and eventually graduate to restocking those shelves as well. Smart retailers should be looking ahead to this future now, working within the now-crowded field of robot providers to use analytics insights to evolve the pick-and-restock robot.
We’ve all heard the phrase “never let a good crisis go to waste…” and while, of course, there’s much heartbreak, there is also opportunity as this virus changes our world. Here are some methods and techniques that we are already seeing in the retail experience:
- We are already seeing liquid sanitizer dispensers everywhere, at the entrance and on every aisle.
- Temperature detectors at store entrances, airports, and office buildings alike.
- Spray-on disinfectants at store entrances in an attempt to eliminate viruses that shoppers might unknowingly carry into the retailer. This could prove to be a great tool for homes and other environments as well.
- Ionizers to purify the air could become a standard fixture in any public environment. Workers could conceivably walk around and wipe every fixture and object touched (or breathed on) by a human, but that’s neither practical, cost effective or scalable — and the people cleaning are also susceptible to carrying, or catching, the virus. Why not automate the process?
- In the grocery store, butchering, slicing deli products and so on, is a perfect application for robots and automation.
- We could have robots navigating stores, collecting air samples, testing them for the presence of the virus, and disinfecting the air and surrounding objects. We already have some examples of this: Brain Corp has floor cleaning robots, and Badger Technologies announced their PatrolBot to monitor stores in addition to their inspect floors bot for spill detection.
- How about cleaning those robots? That is yet another opportunity for automation.
We can come up with many reasons to not do something, but we only need one good reason to do it.
Micro-fulfillment, the new kid on the block
As online shopping rates increase, micro-fulfillment solutions like Takeoff are getting a boost in interest. New innovations in micro-fulfillment are bridging the gap between local delivery, with its benefit of speedy delivery times, and large automated facilities, which offer robotic efficiencies.
Is there light at the end of the tunnel for robots?
For those robotic and automation solutions stalled by the latest crisis, do not be discouraged! The right time will come, and it will come sooner to those flexible enough to note the world’s changing needs and help close those gaps during this crisis and beyond.
Georges Mirza is VP, platform product management at 1010data, a provider of analytical intelligence to the financial, retail and consumer markets. He led the charge and established the roadmap for robotic indoor data collection, image recognition and analytics for retail to address out of stock, inventory levels and compliance, and has been ahead of the trends that have produced industry changing solutions. He currently advises companies on how to strategize and prioritize their roadmaps for growth. Follow him on LinkedIn or Twitter.