One of the big trends of 2019 was the emergence of cashierless checkout companies — startups retrofitting existing grocers with the technology that allows shoppers to walk in, grab what they want and leave the store, getting automatically charged.
So it’s fitting that as the year winds down, we look at one more cashierless checkout company. Though unlike other players in the space, Swiftly‘s cashierless technology is merely a means to a much bigger end.
Swiftly’s cashierless solution isn’t exactly the type of “friction free” shopping its rivals like Trigo and Grabango are trying to create. To use Swiftly, you must download an app to your phone, use that app to scan an item’s barcode, and then interact with a human in a special checkout lane to confirm you aren’t stealing something. While that may be more complicated for the consumer to use, the lack of hardware installation does make it cheaper for retailers to adopt.
But Swiftly is more interested in what happens after you leave the store. In addition to integrating with a grocer’s POS system, Swiftly’s system is also tied into store’s loyalty program, managing any loyalty points accrued and applying them to purchases when available. Being integrated with the loyalty program means Swifty’s system has a shopper’s purchase history, with which Swiftly can use to suggest products, whether it’s because those items are on sale or because Swiftly’s algorithms think an item might be of interest.
But even that feature is more of a gateway to Swiftly’s much broader goal, which is to leverage a consumer’s relationship with a retailer to become a product discovery service for CPG companies.
In addition to recommending specific items for one-time purchases, Swiftly also suggests shoppers subscribe to specific products. Say you want a steady stream (pardon the pun) of Hawaiian Volcano Water delivered to your door each month. You can do that in the Swiftly app, but what Swiftly is actually doing is connecting you with Hawaiian Volcano Water directly. Hawaiian Volcano Water will drop ship directly to you, but it’s wrapped up in a box with your stores’s branding. Swiftly then, is maintaining the relationship between the consumer and their retailer, and creating a new, direct connection between the consumer and the CPG brand.
I visited Swiftly’s offices in Seattle this past week where Co-Founder and CTO Sean Turner explained that his company’s solution is way for retailers and brands to outmaneuver Amazon. It’s a way for CPGs to sell directly to consumers without having to build out their own sales infrastructure, and without having to cede control over to Amazon.
With Swiftly, a CPG brand can have a direct online relationship with the consumer through Swiftly’s app via the retail brand the consumer trusts, and that CPG doesn’t have to worry as much about being undercut by the retailer.
But Swiftly isn’t the only company that’s closing the gap between consumer and consumer packaged good company. Zippin recently announced a $12 million Series A round of funding led by Evolv Ventures, the venture arm of Kraft-Heinz. As I wrote previously:
As newsy as this fundraise is for Zippin, it’s also worth pointing out Evolv’s decision to lead the round. As noted, Evolv is the venture fund of Kraft Heinz, and it’s easy to see why that CPG giant might be interested in a technology like Zippin’s. The cameras and AI in a cashierless store environment give Kraft Heinz insights closer to the consumer, with the ability to analyze what products are picked up, which ones are put back, and which products are skipped over entirely when people shop.
2019 was a year for funding and public deployments for cashierless checkout startups. Swiftly itself announced a $15.6 million seed round this past September. Look for 2020 to be a year where cashierless checkout doesn’t go full mainstream, but rather, continues a steady pace of adoption with different retailers.
For its part, Swiftly already has one live retail partnership with Zion Market, which has locations in Southern California, Duluth, GA, and Lewisville, TX. Turner wouldn’t get into specifics about revenue models for his company, but between facilitating online sales for retailers, developing direct consumer connections for CPG companies, and providing actionable data to both, Swiftly is setting itself up as a company to definitely checkout in 2020.