Smart Carts Might Change the Way We Shop
In the face of mounting challenges from other retail formats, the grocery store industry is seeking innovative solutions to improve the shopping experience and regain lost market share. Smart carts might be the needed solution. Coresight Research reported that grocery store market share has plummeted to 66.6% in 2022 from 69.7% in 2017. Moreover, an estimated market size is $1.5 trillion. This decline may seem small, but even a 1% decrease in market share can significantly impact the industry.
The Changing Landscape of Grocery Shopping
Over the past five years, mass merchants, warehouse clubs, and discount stores have steadily increased their market share. They enticed customers with lower prices and convenience. Furthermore, online shopping allows customers to avoid the hassle of physical stores. Still, brick-and-mortar grocery stores remain preferred for purchasing fresh produce, meat, and deli items.
The Struggle to Adapt
To stay competitive, grocery stores have attempted various adaptations, such as expanding private label offerings, implementing buy-online-pickup-in-store (BOPIS), and introducing self-checkout stands. However, smart carts offer a promising alternative that could revolutionize the shopping experience.
This alternative technology could benefit both retailers and their customers. The AI-powered carts allow shoppers to bypass checkout lines and have the convenience of cashier-less, pick-and-go unattended checkout. That’s similar to the systems used by Amazon Go and Fresh stores.
Smart Carts: How Does It Work?
Smart carts, also known as shopping carts or trolley carts, come in two versions: the full-cart option, which requires retailers to invest in new technologically advanced carts, and the clip-on device that attaches to existing shopping ones. The full-cart option offers built-in weighing scales for produce, enhancing convenience but at a higher cost. Clip-on devices, on the other hand, are more cost-effective but lack the built-in weighing scales.
Leading the Revolution
Veeve, founded by two ex-Amazon engineers, and Albertsons are at the forefront of the new tech revolution. Veeve’s smart carts powered stores have reported a 73% increase in basket size and reduced shopping time to just 24 minutes. Other players like Caper AI, part of Instacart’s Connected Store business, have also made strides, offering accurate weight recognition capabilities for precise item tracking.
Smart Carts Benefit All
Industry experts like John Harmon, Coresight’s senior retail/technology analyst, believe that this technology holds immense promise in revolutionizing the grocery shopping experience. By addressing customer pain points and improving efficiency, smart carts attract and retain shoppers, which could help grocery stores regain market share.
The grocery store industry is facing intense competition from various retail formats and must innovate to stay relevant. Smart carts represent a promising solution that benefits both retailers and customers alike. With improved convenience and a seamless shopping experience, this tech has the potential to become the disruptive technology grocery stores need to thrive in the evolving retail landscape.