Close Ad

The Spoon

Daily news and analysis about the food tech revolution

Smart carts

Instacart Acquires Smart Cart and Grocery Checkout Technology Startup Caper AI

Today Instacart announced they had acquired Caper AI, a smart cart and grocery checkout technology company. Instacart confirmed to Techcrunch they paid $350 million for the company.

In Caper AI, Instacart acquires a portfolio of automated checkout and smart cart technology solutions, many of which are deployed in major national grocery retailers across North America. One such retailer is Kroger, which began deploying “KroGo Powered by Caper” smart shopping carts at a store in Kroger’s hometown of Cincinnati, Ohio, earlier this year.

Caper’s latest generation smart carts feature machine vision that allows shoppers to place the items in the cart and bypass counter checkout altogether.

Caper also has an automated checkout solution targeted towards smaller format stores. The company’s AI Counter utilizes a scale and machine vision to recognize up to 10 items and automate the checkout process.

According to the announcement, Instacart plans on integrating Caper’s technology into the Instacart app as well as both its in-store and online experiences for its grocery partners. One interesting potential application hinted at is a shoppable recipe integration with Caper’s smart carts: “Over time, Instacart expects to integrate Caper’s technology into the Instacart app and the ecommerce websites and apps of its retail partners, allowing customers to build online shopping lists and browse recipes ahead of time and check off their lists as they go. And, for Instacart shoppers who shop on behalf of customers, they can also utilize the carts to find items more efficiently and bypass long checkout lines.”

With the move, Instacart adds another tool to a growing arsenal of e-commerce and in-store technology solutions targeted towards grocery providers at a time many are beginning to question their relationship with the company. Over the past decade, Instacart has provided many grocery chains an easier glide path for moving into e-commerce and in-store shopping automation, areas with steep learning curves that grocers with tight margins have historically been more than happy to outsource. However, some grocers see Instacart’s in-store shopping service as taking too big a cut and possibly disintermediating them in the process.

However, as Instacart grows its enterprise technology solutions, I expect we’ll increasingly see its flagship shopper service decoupled from its technology as it looks to serve larger retailers who want greater control over the customer relationship. Since the start of the pandemic, many grocery retailers have started to roll out and standardize around their delivery services, which means a fast-growing market for technology solutions. My guess is Instacart is anticipating this as it rolls up some of the best-in-class independent solution providers as it prepares for an IPO soon.

In short, this move and others are part of Instacart evolving into a more diversified omnichannel grocery technology arms dealer.

WalkOut Retrofits Shopping Carts with Cameras and Screens for Cashierless Checkout

For retailers looking to explore cashierless checkout, there are two big models emerging: retrofit the store with cameras and computer vision, or retrofit the shopping carts with smaller versions of that same tech. Tel Aviv, Israel-based WalkOut falls into the latter category. It provides retailers with kits that not only transform existing shopping carts into mobile cashierless checkout stations, but also a personalized advertising and recommendation platform.

WalkOut’s retrofit kit contains cameras and a touchscreen base that install onto existing shopping carts. The system uses computer vision to recognize products placed in the cart. (Bulk items are weighed on a separate scale and a sticker with a barcode is printed out for the system to read.) WalkOut’s system does all the image recognition on the edge and not in the cloud, so there is not a lot of data transfer gobbling up a store’s bandwidth. The cart keeps track of what you put into it and tallies your total when you’re ready to leave. When it comes to checkout, stores can choose from different options such as a traditional cashier or a standalone checkout stand for payment.

In addition to providing cashierless checkout, the touchscreen also acts as an advertising and recommendations platform. The screen can be used to guide people to specials currently offered, or personalized recommendations can be shown if a shopper logs in with a store’s loyalty card.

Like with other cashierless checkout options, WalkOut smart carts can also give retailers insight into inventory levels and how customers shop. WalkOut shows retailers what items people are putting in their carts, a customer’s journey inside a store and analytics on which ads and promotions are effective.

WalkOut is certainly not alone in the smart cart space. This sub-sector of the cashierless checkout market is bustling with activity. Caper, Veeve, Tracxpoint, Storewide Active Intelligence, Imagr, Nomitri, SuperSmart and even Amazon all have smart cart cart solutions available to retailers.

Adopting smart carts can be an appealing proposition for retailers because it allows them to experiment with cashierless checkout without needing to permanently install cameras and sensors inside the store. Grocers can test the new system out with some carts to see how it works before making a decision. Kroger, for instance, began testing smart carts on a limited basis in its hometown of Cincinnati, Ohio at the beginning of this year.

WalkOut is currently in trials with a number of undisclosed European and U.S. retailers. The company was founded three years ago and has raised and undisclosed sum of pre-seed and seed funding.

Cashierless Checkout Startup Imagr Expanding into Europe, Says Pilots Cost €65,000

New Zealand-based startup, Imagr announced today that it is expanding its cashierless checkout services into Europe and opening an office in Amsterdam, The Netherlands next month.

Imagr is part of a rising cohort of cashierless checkout startups that create more automated retail experiences for shoppers. Imagr’s particular solution uses smart baskets and shopping carts equipped with cameras to recognize items placed inside. The carts tally up everything the shopper keeps and charges the user automatically in conjunction with the Imagr mobile phone app.

Up until now, IMAGR had focused on the Asia-Pacific region, providing its checkout technology to three stores across Aukland, New Zealand and Tokyo and Osaka Japan. According to a press release emailed to The Spoon, Imagr has finalized deals with two European retailers.

In addition to its European expansion news, Imagr provided something we haven’t heard from other cashierless checkout startups: pricing information. Imagr says that full store system pilots of its smart cart solutions start at €65,000 (~$77,600 USD).

Smart carts is its own robust subsector of the burgeoning cashierless checkout market. Smart carts don’t require the physical installation of cameras into the stores themselves. Instead, a retailer swaps out their existing shopping carts for the more high-tech smart carts. Because there is no buildout into the store, smart carts could prove to be appealing to retailers looking to experiment with the technology. Other players in the smart cart space include Caper, Veeve, Tracxpoint, Storewide Active Intelligence, and Amazon.

Cashierless checkout has had a busy year so far in 2021. AiFi partnered with European convenience store chain Wundermart to build out 1,000 stores. And here in the U.S. Standard Cognition raised $150 million for its solution.

With the global pandemic pushing retailers to create more contactless retail experiences, we’re going to see a lot more expansion announcements from cashierless checkout startups around the world.

Kroger Using Smart Shopping Carts Powered by Caper

With the news last week that grocery giant, Kroger is using Caper’s technology, smart shopping carts are now officially a thing to watch out for.

Winsight Grocery Business broke the news last week that Kroger has quietly started testing its new “KroGo Powered by Caper” smart shopping carts at a store in Kroger’s hometown of Cincinnati, Ohio. The high-tech shopping carts feature a touchscreen, barcode scanner and scale that allow for a more automated checkout process.

Shoppers scan the barcode of items they place inside the cart, which automatically keeps track of everything being purchased (there are safeguards in place is a user tries to put something in without scanning it). Produce and other fresh items are weighed on the built-in scale on the cart. If an item is removed, the user manually deletes it from the running list on the touchscreen. KroGo users have a separate checkout station that communicates with the cart to automatically tally up the total bill shoppers pay.

Interest in this type of automated checkout has accelerated thanks to COVID-19 pandemic. Automated checkout removes the cashier from the grocery shopping experience, eliminating a vector of human-to-human interaction. This is particularly important when it comes to keeping the spread of germs in check, given how many different people a cashier interacts with on a daily basis.

But Caper Co-Founder and CEO, Lindon Gao, told me by phone this week that his company’s smart cart technology got a boost from another source: his competition. “Amazon Dash has really brought this concept more to the market,” Gao said, speaking of Amazon’s own smart cart tech, “It has validated what we have done all along.”

In addition to adapting to new pandemic realities and the shot of validation from Amazon, the retailers Caper are working with also want to enhance the shopper’s experience. And according to Gao, Caper’s built-in touchscreen on the cart does just that.

“The screen is the holy grail,” Gao said. That’s because shoppers don’t need to download an app in order to use the automated checkout. Everything is there on the cart. Additionally, Gao said that people most people don’t shop while looking at their phones, but the on-cart screen travels with them up and down the aisles.

The screen also provides new advertising and promotional real estate for the retailer. A store can advertise specials, upsell companion items (frozen pizza + ice cream!), and push out possible recipes based on what’s in the cart.

Moving automated checkout to the cart can also mean faster adoption by retailers. Other cashierless checkout solutions like those from Grabango and Zippin require stores to be retrofitted with cameras and sensors. That can take time and be costly, especially for larger stores. A retailer adopting smart carts just needs to deploy new carts and don’t require shoppers to download an app to make the automated checkout work.

As such, there are actually quite a few players in the smart cart space. In addition to Caper, Veeve, Storewide Active Intelligence, Tracxpoint, and Imagr, all have various takes on the technology coming to market.

Given all this activity, smart shopping carts are definitely a thing we’ll be watching out for this year.

Veeve’s Smart Shopping Cart Is for Both Consumers and Grocery Employees

One question that comes up when you talk about cashierless checkout is, What do you do with all the cashiers that are no longer needed? Veeve, with its smart shopping cart, thinks it may have an answer.

Based in a suburb outside of Seattle, WA, Veeve makes a smart shopping cart tricked out with cameras and sensors that keeps track of of what you place in it and charges you automatically upon exiting the store. The Veeve cart also has a touchscreen that can guide you to items in-store, present recipes and alert you to deals.

Those features aren’t entirely new. Caper also creates a similar type of cashierless checkout shopping cart. What Veeve does a little differently is that in addition to being available for consumer use cases, its shopping carts can also be a tool for store employees (like former cashiers).

I spoke with Veeve Co-Founder and CEO Shariq Siddiqui this week by phone and he explained that Veeve carts can be a way for stores to create their own Instacart-style shoppers. For example, I could place an order using a grocery store’s app. That grocery list is sent to the Veeve cart where an employee can use it to pick out and assemble the order either for curbside pickup or delivery. In addition to retaining employees, the store doesn’t turn a customer (and all of their data) over to a third-party like Instacart.

Siddiqui also outlined a scenario where everyday shoppers could earn a little extra money by picking up groceries for other people. So if I’m going to my local market, I could get someone else’s shopping list on my cart and deliver those groceries on my way back home.

Siddiqui said that Veeve, which raised $2.5 million in seed funding last November, is still finalizing its business model. But because it works with independent grocery stores, it leases its carts out on a monthly, per cart basis that is “cheaper than a cashier.”

Veeve also has a more advertising-forward business model where it takes a cut of any sales generated by recommendations or upsells delivered via the cart’s on-board touchscreen. This could be done either in partnership with the store or with a big CPG brand with lots of products across store aisles.

I asked Siddiqui why a store should go with a smart cart solution rather than a broader in-store installation of cashierless checkout tech. “The ROI doesn’t make sense when retrofitting store,” he said. “The capital expenditure has a 20 year ROI. You’re just not going to do it. Amazon can do it. Walmart can do it. But the average metropolitan market, that is not a realistic proposition for them.”

The question now is whether Veeve’s dual-use smart cart will be enough of a proposition for stores.