Where Will Checkout-Free Technology Find Its Stride?
Amazon’s “Just Walk Out” technology has certainly experienced a few ups and downs since its release. When announced, the technology was touted as a gamechanger. It was convenient. It eliminated the need to check out. And during the pandemic, it looked as if it was going to be the easiest way to minimize contact.
But things haven’t been completely rosy. The consumers who use it swear by it. Businesses serve to gain from it. But many entities on both sides of the coin remain skeptical. From privacy and accuracy concerns to data ownership, adoption remains slow.
Today, we’re digging into the world of checkout-free technology, exploring the areas in which it shows promise—and the spaces where it could thrive.
An Extremely Brief History of Checkout-Free Technology
The year was 2016. The Cubs were en route to their first World Series in 108 years. A real estate mogul and reality star was running for president. And a handful of companies came to the conclusion that the future of retail was checkout-free. So it began—AiFi, Grabango, Zippin, Amazon, and likely a host of others set up shop with one goal, to eliminate the checkout process.
Utilizing a combination of sensors, cameras, and other hardware, the technology allows a customer to scan themselves into a store, grab the items they need, and simply walk out. Amazon kicked off the nationwide rollout with its Amazon Go and Amazon Fresh stores. Retailers launched pilot programs. And early adopters jumped on board.
There’s a reason that many retailers and consumers like the idea—the benefits are tangible. Customers save time. Retailers get to dedicate staff to other areas (cleaning, stocking, and service). Implementation could mean increased hours of operation without increased labor costs. And stores could open in underserved communities.
Promising Deployments, Slow Adoption
Throughout the years, retailers of all stripes have tested the waters. Giant Eagle has made good use of Amazon’s competitor in Grabango. And in the first year, the deployment saved customers 10,000 minutes. Now, this may sound exciting, but… 10,000 minutes is roughly a week. Spread across the company’s 474 locations, this averages out to 21 minutes saved per store.
Is this to say that grocery stores are not the right place? Not at all. Just maybe… not yet. It’s easy to believe that in a couple years, 10,000 minutes can easily become 100,000.
The same goes for Amazon’s Amazon Go and Amazon Fresh stores. The idea is good. The early adopters who use it love it. But it’s a solution in search of a pain point. Getting people at the middle and back of the adoption curve to take the next step is going to be a challenge.
And it’s likely the reason that Amazon has closed stores and put a pause on expanding Go and Fresh. The people who love the idea swear by it, but adoption is slow.
Four Places Where Contactless Checkout Will Thrive (First)
The problem with certain spaces like grocery stores and convenience stores adding contactless checkout technology is that maybe these spaces aren’t ready to be disrupted. It took a global pandemic and talent shortage to get people used to self-checkout. It’s still reasonably surreal to see self-checkout at a c-store; going completely cashierless may be overwhelming for some.
But there are some specific areas where contactless checkout would be ideal. As the process evolves and customers get used to making purchases in the following environments, it’s easy to see adoption in other areas.
The hospitality space could be one of the biggest beneficiaries of contactless checkout. Because adopting it could solve a wide range of pain points occurring throughout the system.
This starts with the granddaddy of cashierless technology, the minibar. Or should we say, the lack of minibar. Over the past decade, the minibar has fallen out of favor with guests and hotel owners. Items are expensive, revenues are pitiful, and the process of counting and restocking takes valuable time away from cleaning.
But it doesn’t end there. Adopting a just walk out solution can free up front desk staff, allow hotel operators to expand their selection of goods, and capture revenue that would otherwise be lost to nearby convenience stores or delivery apps.
Though the technology still has a slight hill to climb—charging purchases to a room remains a challenge—it’s easy to see hotels as a proving ground in coming years.
Looking to learn more about the reasons hotels should look into checkout free technology? Check out our latest blog!
Customers spend a lot of money to see a sporting event or concert. But annoyingly enough, they have to spend a lot of time waiting in line—and missing the event they paid for. Stadiums are all about lines. Line up to get through security and ticketing. Line up to go to the bathroom. Line up for autographs. And… line up to get concessions or merchandise.
And this is what makes contactless, frictionless checkout technology so appealing for these venues. Though it might not help alleviate some lines, it’s certain to shorten the time spent waiting for a beer or hot dog.
Perhaps the most logical area to implement the technology, many arenas have already deployed it, with Seattle’s Climate Pledge Arena, Chicago’s United Center and Boston’s TD Garden leading the charge. According to an article from Sports Business Journal, transactions can be completed in less than a minute, with the ‘raised-palm’ method allowing one fan to grab a beer and go in only 8 seconds.
Another area filled with lines, stress, and a good reason to implement contactless technology is the airport. By the time a traveler even gets through security, they’re sick of lines. And that’s before they even have to wait for their boarding group to be called.
Not only would the decision to add this technology free up airport employees, it would encourage spending by de-stressing a lot of the impulse purchases at newsstands, restaurants, and more. Better yet, travelers are already used to the process, which simply replaces a boarding pass for a credit card.
Well-known newsstand Hudson was among the early adopters of the technology, launched Hudson Nonstop at Dallas Love Field Airport in 2021. JFK Terminal 4 and food retailer SSP partnered with Zippin to launch Camden Food Express with this frictionless technology later that year. Brazilian retailer Americanas turned to the same startup to launch Ame Go in the country’s RIOGaleão airport.
Contactless technology could be coming to a university near you. After all, deploying minimally staffed, 24/7 convenience stores in residence halls and libraries makes sense.
Pulling an all-nighter? Drop by the store to grab a Red Bull and sandwich. Rough morning? Head downstairs for some Tylenol and a bottle of water. This sounds a whole lot better than trying to find the one person with a car, relying on a vending machine, or working around cafeteria schedules.
But the ball has started to roll. Virginia’s Marymount University recently announced that they have become the first higher education institution in the U.S. to have an on-campus convenience store powered by Amazon’s Just Walk Out technology.
Opened in spring 2023, the university’s Saints 24 store was designed with student input and will offer a variety of essentials including food options like freshly prepared sandwiches, wraps, salads, sushi, yogurt and ice cream, as well as other items such as toiletries, feminine hygiene products and more.
Though it’s still going to take some configuration to truly thrive, this feels like it could become a good fit. After all, the above-mentioned Marymount deployment still requires a credit card. A logical next step would be to expand the program to incorporate flex dollars and meal swipes on student IDs.
Checkout or Not, Create An Unforgettable Experience
Whether you’re leveraging the latest and greatest technology or focused on a more traditional shopping experience, it all comes down to creating a space that customers love. And that’s where we come in. We’re Morgan Li, and with eight decades of experience in the fixture business, we know what it takes to transform spaces.
From pop-up shops to flagships, big box stores to luxury brands, we specialize in creating custom fixtures, furniture, and graphics that are built to last—and that leave a lasting impression.
Learn more about who we are, what we’ve done, and how we help—and drop us a line when you’re ready to talk.