Will all retailers soon go cashier-less?

Discussion
AiFi product recognition and tracking - Source: AiFi
Mar 06, 2018
Tom Ryan

After reportedly five years in development, the first Amazon Go opened in January, raising speculation over the practicality and adoption rate in the industry of cashier-less stores. Last week, a start-up said it is getting ready to deliver the “first scalable checkout-free solution” suitable for mega-retailers and affordable for mom and pops.

Describing itself as a “computer vision technology,” AiFi’s founders previously worked for Google and Apple on projects like 3D Touch and Google Glass.

Using AI (artificial intelligence) algorithms, sensors and camera networks, AiFi’s checkout-free technology will track shoppers as they move through the store, recognize shoppers as individuals and secure payment through a companion app, much like the tech used at Amazon Go.

AiFi could save shoppers billions of hours waiting in lines while offering retailers improved inventory management data as well as valuable insights into consumer shopping habits and product preferences. According to the company, the technology aims to provide a “comprehensive understanding of shopping behaviors and gestures (even identifying abnormal gestures), and the ability to identify people who are shopping together as a group.”

AiFi promises to be able to track up to 500 shoppers and “tens of thousands of SKUs.” The technology, which will be available via a subscription, also doesn’t require any major retrofitting. With little reliance on hardware, the AI costs are expected to scale to make it accessible to small stores.

According to TechCrunch, the company is planning to outfit a demo store in the San Francisco Bay area along with conducting a pilot with a larger grocer in New York that will open by the end of the year. The company has so far received $4 million in seed funding.

Said Steve Gu, CEO, AiFi, in a statement, “The shopping experience now demonstrated and widely promoted by Amazon is just the tiniest taste of what the AiFi technology will do for retailers — with shops that range from tiny to huge.”

While AiFi said AI should free up cashiers to do more creative tasks, many articles covering the introduction discussed the possibility that jobs would be lost. Also explored were the tradeoffs of privacy consumers would make in exchange for avoiding checkout lines. Wrote Rhett Jones for Gizmodo, “Have fun being followed by personalized ads and never having to interact with a stranger again.”

DISCUSSION QUESTIONS: Does it make sense that the underlying technology behind AI that supports cashier-less stores would be highly scalable? What advice would you give to big and small retailers should the technology come within reach?

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"More than the size of the retailer, the implementation of this technology will be governed by the retail vertical."
"Cash as a means of payment is not going away any time soon. Thinking of the future in strict binary terms is not very helpful and can even be ruinous."
"Scalability is not the issue for AI that supports cashier-less stores. There are many other challenges that make this more complex to execute..."

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45 Comments on "Will all retailers soon go cashier-less?"


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Mark Ryski
BrainTrust

The Amazon Go store reportedly had hundreds of sensors, scanners and cameras – it took years to develop and still wasn’t perfect at launch. I’m very skeptical that early stage entrants like AiFi are robust and accurate enough to be viable. I would advise all retailers to proceed with caution on this front – affordable, accurate solutions are still years away.

Seth Nagle
BrainTrust

Great points Mark, additionally I’m curious to see how AiFi technology will track the one-off shopper from the basket — the kid that sneaks off and tosses in the extra bag of cookies or the husband that branches off from the group to grab the salad for the BBQ.

There are lots of scenarios that need to be played out first before grocers can feel confident as every penny counts in this business.

Max Goldberg
Guest

Cashless stores may be in our future, but many consumers rely on cash and dumping that option means losing their business. Retailers should explore AI technology, but be aware of consumer preferences and not rush to adopt technology that may not fit the lifestyles of many of their customers.

Lyle Bunn (Ph.D. Hon)
BrainTrust

Truly stated, Max. Consumers do vote with their wallet, no matter the payment they pull from it. We are all addicted to points, and cards make this seamless.

Jon Polin
BrainTrust

While some shopping behaviors are debated — some consumers prefer in-store vs. online, some prefer big boxes vs. mom-and-pops, etc. — this technology is a runaway win. Do any consumers like waiting in checkout lines? My advice to retailers of all sizes is that when this technology is truly viable and scalable: grab it — free up your customers from the tyranny of checkout lines.

Chris Petersen, PhD.
BrainTrust

AiFi will save customers countless hours, and dehumanize the experience. Customer experience is situational and depends upon context. When the shopper knows exactly what they want, and speed is at the top of their list, AiFi-type stores provide convenience and value. However, when shoppers are less sure about choices or need assistance in making selections (e.g. apparel or technology) knowledgeable staff become highly valued. There is no single best solution for every situation or customer scenario. The best advice for retailers selling “high touch” products and services is to double down on staff who can differentiate experience in-store as well as service after the sale.

David Weinand
BrainTrust

Perfectly stated Chris. It’s all contextual. I would say that for convenience stores, that technologies like AiFi have a real application that will likely rule the day in the not-so-distant future. Other formats need to be careful as the customer experience is how they need to define their store strategy.

Celeste C. Giampetro
BrainTrust

Piling on to David’s comments as well. I couldn’t agree more that the consumer experience must match up with the store’s value. Tech is great if it improves the customer’s experience with your store. I, for one, don’t mind waiting in lines. I heard a great joke just the other day waiting in line from a kid and her mom in front of me, and it made me laugh all day.

Phil Masiello
BrainTrust

Every time I shop, I wish this technology was already implemented. The technology, once proven, will absolutely be scalable. I believe there are going to be issues with theft, inventory management and product management. But once those are worked out, it will be off to the races.

Once this is ready, in order to get the most out of this technology retailers must pay attention to the information it is providing. By watching customer shopping behavior patterns, it will enable retailers to build more efficient layouts and shopping experiences. The obvious benefits are around product mix and product placement.

The benefits to the customer are speed and convenience.

I absolutely believe it will become a reality and I can’t wait.

Byron Kerr
BrainTrust
Byron Kerr
Head of Amazon, Tuft & Needle
6 months 16 days ago
Completely aligned with your sentiment. The key to getting this out in the market before it is perfected is DATA. It’s much easier to refine and tweak with real-time use, and the quicker AiFi and others have access to real-time use/data, the quicker they can iterate and build a more robust, scalable solution. For B&M to continue to thrive in the growing eCommerce/convenience-first world we live in, they must provide experiential shopper experiences that remove frustration and increase loyalty. The retailer that I rarely hear mentioned in this conversion is Apple. They’ve had a “Scan and Go” concept for years now: want an iPhone case and know where to find it? Pick it up off the shelf, scan and pay via your phone, and GO. They are a great example of building a hybrid approach where you can engage a Genius or Sales Rep when needed (and for bigger ticket items), conduct self-awareness/learning of products via demos, and purchase lower ticket items on the go. Would love to see how they evolve this concept in… Read more »
Dave Nixon
BrainTrust

The scale issue will not be out at the edge with the sensors and the array of capture devices. The scale issues will show themselves with analyzing the TSUNAMI of data and making real-time and predictive decisions based on it. Very few companies in the world truly have the ability to manage that level of analysis. I know this for a fact. Teradata is one of them and was built over 30 years. The industry throws around terms like “AI,” and “machine learning” and “predictive” and “scale” like it is easy. It just isn’t.

This is great stuff though and startups like these will further disrupt the retail “channel” but I am skeptical of such bold claims as these.

Brandon Rael
BrainTrust
While the transaction-focused, behind-the-counter sales associate or cashier may become obsolete with these new technological innovations, it’s time to unleash the power of this resource and evolve them into brand ambassadors. We all could agree that in our mobile world, the traditional cashier paradigm is phasing out, however, the challenge for retailers both big and small is what to do with these resources once their roles evolve. If you empower these sales associates to roam the sales floor with a mobile iPad-like device, they can evolve into the Apple store model of being a brand evangelist, product specialist and a cashier. With the right consumer insights at their fingertips, they can be on equal ground with the already digitally-empowered consumer. The challenge for retailers is to provide an outstanding in-store customer experience. What better way to provide this then to leverage your existing workforce, empower, train and provide a defined career path as brand ambassadors. This is all part of the evolution of the retail model. Automation will not solve retail’s challenges by itself. Rather,… Read more »
Dr. Stephen Needel
BrainTrust

Brandon, very hopeful — and highly unlikely. If this technology becomes available, most of these people are out of a job. Nobody wants to be sold to in a grocery store.

Brandon Rael
BrainTrust

I do agree that it’s an optimistic perspective and more than likely there will be significant reductions in staff at the grocery stores.

However, I am very confident that the empowered sales associate/brand ambassador will resonate very well within the fashion, luxury, beauty and lifestyle segments.

Phil Chang
BrainTrust
Phil Chang
Retail Influencer, Speaker and Consultant
6 months 16 days ago

This is an interesting way to keep your store staff in places that matter most. If the technology is available and affordable, moving the human cashier away from the till and to the floor where they can interact with consumers is better for the retailer, the staff member and the consumer.

The key is “affordable.” Large retailers *may* be able to afford this, but small/medium retailers will struggle with implementing this. To add to this challenge, companies like Square, Lightspeed etc., are already creating a great cash-out experience, meaning that cashier-less is going to have to be very competitive for retailers to switch.

Bob Amster
BrainTrust

It is not the AI that has to scale. Cashier-less environments require numerous sensors and cameras that send information to the AI algorithms. Deploying these is not a trivial expense and, if ever, the expenditure will not be affordable by all retailers for a long time.

Chris Buecker
BrainTrust

Yes, absolutely. This is going to be the future. Who likes to stand in line? The consumer appreciates frictionless shopping during his purchasing journey. Also e-commerce giants like Alibaba and JD.com are in the race to roll out the first fully automated store for commercial use with cashier-less solutions included. My advice to retailers would be: Jump on this train and try it out in a test market. If successful, start soon with the rollout. It will not only increase efficiency but it will also draw lots of media attention.

Harley Feldman
BrainTrust

The underlying camera technology, as Amazon has found, is not scalable without cost impact. The challenge in recognizing more products that are densely stored along with the humans moving through the store requires a lot of cameras. The other challenge is recognizing 100 percent of the products in the store. In the RFID space, one of the lessons learned is 100 percent read rates are important to having accurate data in support of getting to a complete picture of consumer demand and recording the sales. The camera solution will require the same accuracy in the future. I would advise retailers to track the technology and determine if it works for them. Sellers of shoes, lingerie and other personal items will be unlikely to use the automated checkout technology to the exclusion of associates helping the consumers.

Art Suriano
BrainTrust

Yes, this is a great convenience, and it will be unstoppable because that’s progress and we are already seeing technology taking over in all areas. However customers are all different, and so are their likes and dislikes. Paying through an app will be the perfect method for many but not everyone. Look at how many drivers still refuse to get an EZ Pass. Retailers need to remember the more they take the human experience out of the equation the more they are reducing what should be an excellent customer experience. And the thought that this would allow cashiers to do other things? Does anyone really believe that? The first thing most retailers will do is eliminate the cashier jobs. The smart retailer will be the one who will offer this as an option for those who want to use it and not the only choice. Some people still like talking to the cashier.

Ron Margulis
BrainTrust

More than the size of the retailer, the implementation of this technology will be governed by the retail vertical. Luxury and discount retail channels will have human cashiers longer than others due to the desire for interaction and upsell on the high end and cost on the low end. Middle market retailers like DIY/hardware, pet and select mass, grocery and drug are more likely candidates for early adoption because of customer demands for quicker service and the potential crossover with e-commerce.

Ken Cassar
BrainTrust
Ken Cassar
Vice President, Principal Analyst, Rakuten Intelligence
6 months 16 days ago

It seems inevitable to me that the cashier largely goes away in the long run. In addition to Amazon Go and folks like AiFi, we already see widespread use of self checkout and mobile scan and go technology. The implications on trip behaviors are very interesting; if a shopper can get in and out of the store without friction, we could see a higher number of smaller trips in an average week, which could radically reshape the grocery industry.

Tom Dougherty
BrainTrust

Anything that simplifies the customer experience has legs. This has the added benefit of being personalized.

We are looking at the NEAR future, not the distant future. It is an economy and as such, will inexorably move towards less interaction. It’s what shoppers want.

Kai Clarke
BrainTrust

I have my doubts that we will “soon” see more cashier-less stores. The immense amount of cameras, scanners, AI and embedded smart technology at the shelf-level, in the store and in the backroom, makes this a daunting task at best. Add to this the cost and it becomes even more questionable. Oh yeah, the millions behind a small-footprint Amazon store with limited selection that is still buggy causes even more concern. Proof of concept is one thing. Real proof on a large scale is another. “Follow the money” is the best rule here. Only time will tell, but it is clearly not going to happen soon.

Gene Detroyer
BrainTrust

Let’s stop pretending that the cashier is part of a positive shopping experience. Given a choice, would any shopper choose to go to a cashier when alternatives are available?

I am not a tech guy and don’t know how long this transition will take. I suspect faster than any of us can imagine. But any retailer that does not take this seriously will be left behind.

Today’s shopper wants speed, ease and convenience. Tomorrow’s shopper will demand it even more.

David Weinand
BrainTrust

I’ll still take a cashier all day over the current options for self check out (unless it’s 1-2 items).

Doug Garnett
BrainTrust

Do shoppers want their stores to be cashier-less? I don’t think so. Cashiers provide tremendous added value for many stores and types of stores. Amazon chose to set up their first Go store using a convenience store — where shoppers will be most open to it.

Should retailers want their stores to be cashier-less? I don’t think so. For all the vague discussions of “experiential” stores, one primary experience which strengthens shopper loyalty is good interaction with store help like a smart, effective cashier.

Given this, what’s up with this startup? My hunch is they’re a dash for the cash. This fits the classic story for raising capital — promise far more than can actually be delivered, promise something that sounds like it’s out of a sci-fi book, base it off of something Amazon did, claim that it scales and let the investments roll in.

Retailers should be cautious about jumping on this bandwagon. We’ve all seen this kind of big tech promise fall through.

William Hogben
BrainTrust
Retailers with three or more cashiers are unlikely to shut down all registers for some time — rather they will keep a register so they can accept cash and handle the miscellaneous cases where full self-service is unavailable. The technology behind tracking shoppers and what they pick up IS highly scalable — because it’s based on machine learning the larger the scale, the bigger the training set and the higher the potential accuracy. Will AiFi outdo Amazon Go and Standard Cognition and Accel Robotics and the other vision-based checkout startups? Maybe — it all depends on the accuracy they’re able to demonstrate. Amazon’s five years of development doesn’t speak to the difficulty of the technology, more to the difficulty of identifying and closing the edge cases and gaps created by real-life shopper behavior. It’s hard to predict whether AiFi or Amazon Go or the others will scale without understanding the accuracy of the system and the maximum density of shoppers — at some point the shoppers themselves start occluding the cameras. Our original business plan… Read more »
Neil Saunders
BrainTrust

I doubt it. I agree that technology will reduce the number of cashiers in the medium term, but even over the longer term, cashiers will still have a role to play – not least because some consumers prefer interacting with other humans!

Mohamed Amer
BrainTrust
Cash as a means of payment is not going away any time soon. Thinking of the future in strict binary terms is not very helpful and can even be ruinous. Reality is always a hybridization of past, current and future processes and technologies. That said, anything that contributes to reducing or eliminating the checkout queues in retail will be wildly embraced by consumers. As to AiFi’s specific situation, they have several elements on their side: timing, technical pedigree of the team and a subscription monetization model. On the downside, there’s dependence on a single technology element — AI based on visual sensors. Also a concern is their ability to scale at the store level considering square footage, number of shoppers and the nature and number of SKUs as well as scalability across hundreds or thousands of stores in a chain. Another is the apparent limited amount of funding to date given the size of the opportunity and all the associated moving parts. It’s also not clear how the captured sales and consumer behavior data will… Read more »
Herb Sorensen
BrainTrust

This is an absolutely astounding grasp of the entire problem. I especially appreciated the comment on “visual sensors.” Too often, tech people overlook that the door to the shoppers soul is through their eyes, and the best way to SEE what they are seeing, is through our own “eyes,” one place removed via cameras. AI + cameras simply makes our own “seeing” potentially unlimited as to time and place. You might be interested in: “How To Observe, Measure And Think About Shoppers.

Mohamed Amer
BrainTrust

Thank you Herb for the commentary and the link. I liked your article and found your treatment of “time” insightful. Lots of food for thought in this visual maze.

Herb Sorensen
BrainTrust

“Will all retailers soon go cashier-less?” The answer is absolutely YES, with a single caveat on the word “soon.” If “soon” can mean “in the next 20 years,” the answer is certainly yes. But then, how long did it take for the iPhone (and successors) to stitch the ENTIRE world together?

Paula Rosenblum
BrainTrust

In a word … no. It’s too easy to defeat and thus shrink will rise. AI isn’t smart enough to detect a customer determined to steal.

Dr. Stephen Needel
BrainTrust

If we eliminate the checkout line – how am I going to know what’s going on in the world via the National Enquirer? 🙂

Dick Seesel
BrainTrust

Some stores will never be suited for a cashier-less system (most obviously, retailers like Nordstrom) but it has application to plenty of other stores. It’s a question of scale and how long it will take for enough early adapters to drive the cost of these systems down for everybody else. Think about the evolution of RFID: It’s been hailed as the next big thing in inventory management but has taken seemingly forever for even big national chains to adopt the technology. I don’t expect this to be any different given the short-term capital expense involved.

Lee Peterson
BrainTrust

It’s going to happen. The US is already at 80% for non-cash payments’ share of total value of consumer payments (CNBC Report). So it’s just a matter of time. But like anything in retail, especially in the US, speed of execution depends on your customer.

Case Study: We opened a high-end grocery store in a wealthy suburb just outside of Chicago called Standard Market. The owner’s vision was cashless. There was literally pandemonium the first day due to the fact that many of the older customers had cash only. Nightmare, and adjustments were made.

Moral of the story is: go there as fast as you can, just don’t destroy your customer base on the way. (It’s a fast evolution.)

Ralph Jacobson
BrainTrust

We’ve been talking about going cashless for years. I believe it will happen eventually, however, there is still a large population of unbanked consumers who will favor cash for the foreseeable future. Yes, the AI technology will get its bugs worked out quickly and more competitors will join the fray.

The one prediction I will make is that years from now, when cashless/”staffless” stores are the norm, a disruptor will enter the market with real, LIVE humans to offer assistance in their stores and the talking heads on TV will be amazed at the idea.

Steve Montgomery
BrainTrust

Cashier-less as a concept for retailers sounds great. However, the reality is far more complicated. There has to be a broadly accepted app. If not, then consumers would have to have many apps on the phones and remember which app works at which stores. The expected squabble between retailers seeking to secure consumer loyalty via these apps is likely to prevent that from happening. Consumers also have to be willing to sign up for the apps.

Finally, as Amazon Go early stores have shown, going cashier-less does not mean a large reduction staff.

Craig Sundstrom
Guest

I’m not sure this is really a “technology” issue, i.e. if this doesn’t work it will be because the model doesn’t reflect reality, more than it will be about some kind of technical problems.

Is this what the world is waiting for? I’m not sure, but the only way to find out is to test it. I’d wait on the results of the few demo stores before making any kind of prediction(s).

Dan Raftery
Guest

While I’m 100% behind the progress being made in technology at retail and have been waiting patiently for Arthur Anderson’s Store of the Future to arrive, I’m skeptical when an advance this large is so glowingly touted by its owner. Just can’t shake the memory of similar announcements (remember Webvan? viaLink? ThumbFind?) that did not deliver on the hype.

Since $4 million is peanuts these days, it sounds more like a marketing pitch to VCs than a system ready to fly in the real world. If they do launch broadly, I hope they have all the angles figured out so the “system beaters” don’t cause too much shrink for the poor retailers involved. (System beaters — you know who you are.)

Ken Morris
BrainTrust

Scalability is not the issue for AI that supports cashier-less stores. There are many other challenges that make this more complex to execute than traditional retail software applications: the art and science of building the rules for the AI algorithms, integrating all the systems (the cameras, the sensors, the network), training customers and dealing with hard to scan/weigh items.

The technology vendor and or retailers that are first to market will have an early adopter advantage.

Conceptually, busy consumers will thoroughly embrace this new process, as convenience is highly valued. But this technology will not fly in every location of the country, as the loss prevention aspects of this technology have not been quantified to the best of my knowledge.

Min-Jee Hwang
BrainTrust

I say retailers should proceed with caution. Self-checkout kiosks are prevalent in stores, but they haven’t eliminated the need for regular checkstands. Testing it out is a good call for retailers that want to reduce friction, especially if they have a large budget for trying out new technology. At the end of the day, checkstands have withstood the test of time for a reason. This technology will have to work seamlessly and be affordable before it has mass appeal.

W. Frank Dell II
BrainTrust

To get rid of the cashier, you first much change the payment form and then process. Retail has been moving away from cash since the ’50s. Cash and house credit accounts were the norm. Then came checks, which much of the world never used. Credit cards and debit cars now account for the majority of retail transactions.

The evolution of self-checkout reduced cashiers by 75% and they only accept credit and debit cards. If there is no cash or checks for the cashier to accept, their job is simplified. For some formats like convenience stores the cashier is not very busy or productive.

A store without cashiers may be possible. Publix and Wegmans are outstanding supermarket chains where customer interaction is a very important element to the shopping experience. Supermarket and department stores having no service/cashier will likely fail. Online shopping rarely has human interaction, but still has a self-checkout process. Limited formats could go cashierless, but not all forms of retail.

Tony Orlando
BrainTrust

The simple answer is no. In spite of all the technology, some stores simply can not afford all of this, and many customers still like a well run front-end with a friendly smile and someone to help you out to the car. We have all the credit card and social media stuff, which is great, but I’m sorry, my store will stay as it is for our cashier situation. If I’m wrong, so be it. Old-fashioned service is what I prefer. When I go out shopping and that makes me out of touch with reality, grab me a glass of wine and I’ll debate it with my tech friends and see how it turns out.

David Katz
BrainTrust

In an evolving retail landscape, many things are changing. From compression of supply-chain, to online migration and other changes to consumer path to purchase. In this environment it’s important to remember that some things will not change. Customers will continue to want … better products and better values, faster deliveries and frictionless payment experiences.

If consumers decide that cashier-less stores reduce friction, stores without this service will be seen as unfavorable.

It’s not matter of if … it’s a matter of when.

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Braintrust
"More than the size of the retailer, the implementation of this technology will be governed by the retail vertical."
"Cash as a means of payment is not going away any time soon. Thinking of the future in strict binary terms is not very helpful and can even be ruinous."
"Scalability is not the issue for AI that supports cashier-less stores. There are many other challenges that make this more complex to execute..."

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