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smart grocery cart

April 9, 2024

Big Tech Set Its Sights on Reinventing Checkout. Consumers Said ‘Not So Fast’

When it comes to technology and grocery shopping, one primary focus for grocery chains and technology providers in recent years has been the checkout experience.

Amazon and various other technology companies have been developing platforms to enable consumers to skip the checkout counter. These platforms aim to transform the shopping experience into something akin to walking into a giant pantry, loading up your cart, and then walking out without going through a checkout line.

Others (including Amazon) pushed technology into the shopping cart, enabling customers to check out products as they walked through the store, get coupons and ads for special deals, and learn more about items via a built-in touchscreen.

And then there’s online grocery shopping. After two decades of slow adoption by both grocers and shoppers, a pandemic forced every major grocery chain to invest heavily in enabling the easiest of all grocery buying options: letting us shop at home and have our groceries delivered to our door.

Meanwhile, everyday consumers continue to do things the way we’ve always done things. It’s a lazy Sunday, and you’re in no hurry? Get in line and chat it up with the cashier and bagger. Are you hurrying to return to work or arrive home in time for dinner? Jump into the self-checkout line and get out as soon as possible. Too busy to head to the grocery store at all? Order online and have stuff delivered to your home.

In other words, grocery shoppers are not a monolith. Most of us change our behavior depending on the current situation.

But what about Just Walk Out? It’s a radically tech-forward evolution of checkout, but one in which Amazon appears to have widely overestimated just how many people would use it and how easy it would be to implement. As I said in last week’s Food Tech News Show (FTNS), self-checkout fits most shoppers’ needs when they are in a hurry, and there aren’t that many situations where consumers feel they need to skip checkout altogether.

As for self-checkout, it definitely isn’t perfect and could be made a much better experience. As Scott Heimendinger said on the FTNS, self-checkout can sometimes be unnecessarily difficult, almost like plugging in a USB. Amazon and others should probably spend their time using technology to make self-checkout work better.

We love robots - FTNS

Target is doing something about self-checkout, changes which it claims will allow shoppers to get out quicker. According to the company, self-checkout lines with cameras were able to check out twice as fast as self-checkout lines without a camera. Of course, their motivation is mostly somewhat self-motivated, driven by the retailer’s desire to limit theft, so my guess is there’s a good chance they can bungle the rollout if it doesn’t deliver clear benefits and customers are feeling spied on.

All that said, while some shoppers may not like it, the combination of computer vision and self-checkout might be the future, particularly if it makes the self-checkout experience less painful than it currently is. Because of this, Amazon should look at repurposing its Just Walk Out into a self-checkout accelerator, not a platform for making shoppers feel like they are shoplifting. For now, however, they’re emphasizing the rollout of their Dash shopping carts, a solution that is unclear if shoppers are asking for. Others, like Instacart, are also betting big on as well. The company had a blog post touting their progress today, saying they plan to have ‘thousands’ of shopping carts deployed by the end of 2024.

Just Walk Out and other light-touch self-checkout will thrive in the near term in shopping contexts where a consumer needs one or two items and is in a hurry, such as airports and stadiums. One of the smartest implementations I’ve seen with self-checkout is at Costa Coffee at SeaTac airport, where they had a Mashgin AI-powered self-checkout station with a dedicated line for customers who just wanted drip coffee. In other words, a quick and low-touch checkout solution for a product with a high degree of certainty where customers are often in a hurry.

The bottom line is that everyday shoppers will continue to shop the way they’ve become accustomed to, choosing between three primary methods: full-service checkout, self-checkout, and delivery. More advanced technology should primarily focus on improving these existing modes. New technology that allows (or forces) consumers to change their behavior should only be used in scenarios that make sense.

Otherwise, consumers will reject it, and retailers will be forced to retrench, just like we saw last week with Amazon’s pullback of Just Walk Out.

September 7, 2023

On Eve of IPO, Instacart Bolsters Grocery Tech Platform, Including New Features For Caper Smart Shopping Cart

Today, Instacart rolled out a slew of new updates to its grocery technology platform, updating capabilities across its white label turnkey digital commerce platform, its AI-powered search capabilities, and new features for its Caper Cart smart shopping cart. The new feature-set rollout marks further integration of the string of acquisitions the company has made over the past couple of years as it refashions itself from a pioneering personal-shopper service to a technology arms dealer for grocery retailers.

One of the key upgrades was around the company’s white-label commerce platform, Instacart Storefront. The company, which counts Costco among others as customers for the Storefront platform, gives access to Instacart’s machine learning technology, access to its white label mobile app, and a variety of other features. The company also talked up its ability to connect the online and app experience to in-store shopping via list sorting by aisle, highlighting in-store promotions and discounts, and enabling customers to use store loyalty cards.

This spring, Instacart rolled out generative AI conversational search via its website and now has added it to the in-store experience via the app. According to Instacart, the app will give customers access its ChatGPT integration via search, alongside Instacart’s own product data and proprietary AI models.

And finally, the company announced a slew of upgrades for its Caper Cart smart shopping cart. The new updates will allow customers to order made-to-order items like deli sandwiches or custom cakes directly from their Caper Cart, and will also enable retailers to offer incentives like coupons and points for completing actions like adding certain items to a cart or trying the Caper Cart for the first time. The company also is rolling out a Caper Cart dock, a permanent charging and storage place for Caper Carts.

These moves are further evidence of a strategic pivot I wrote about two years ago, in which Instacart transitions itself into a provider of technology solutions for grocery retailers:

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.

… 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.

And, right on time, the new product suite comes just as the company is set to price its IPO as soon as next week.

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