Retail Automation: What Technology is Transforming the Future of Retail?

In an industry driven by cutting-edge technology, evolving consumer behavior, and bold innovators, see what new automations are driving change that will last.

State of Retail in 2020

 Retail has arrived at a watershed moment.

Margin pressure is mounting: Retailers face rising labor costs, more expenses in their e-commerce supply chains, and making larger investments to combat competition. As a result, more than 81 major retailers have filed for bankruptcy from 2015 to 2019, with an additional 14 already filing in 2020, including well known retailers like Tuesday Morning, J.C. Penny and Pier 1.

Meanwhile, consumers expect more and more from retailers. Digital natives and disruptors continue to raise the bar of personalized service and convenience. Customers now seek retailers that save them time and meet all their needs in one place, ultimately “outsourcing” the work of searching for the products they want.

In fact, in a recent study by National Retail Federation, 83 percent of consumers say that convenience when shopping is more important now than it was five years ago. It’s no surprise then that 80 percent of online shoppers in the U.S. now want same-day delivery to be an option at checkout, and nearly 70 percent of consumers have used buy online pickup in-store (BOPIS) in the past six months.

In this context, automation emerges as essential to the evolution of the retail industry.

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How will automation in retail transform the customer experience?

In the realm of retail, automation describes using technology to automate or semi-automate the retail experience, like with self-checkout kiosks or order pickup lockers. Retailers moving away from typical cost-reduction strategies can use automation to support their margins. At the same time, automation lets retailers maximize their operation’s efficiency, meeting consumer demand for personalized service, speed, and convenience.

Ultimately, automation in retail improves the customer experience, reduces costs, drives sales, and fuels long-term growth. At Bell and Howell, we help retailers implement automated solutions into their customer engagement models to stay on top of evolution in the retail industry.

Keep scrolling to see examples of how retailers are automating their experience to meet customer demand.

Dark Stores

 

With dark stores, traditional retail stores are converted into local fulfillment centers. These mini warehouses shorten delivery times and provide a faster, more convenient shopping experience, especially in densely populated areas.

Bed Bath & Beyond, Walmart, Kroger, and even a number of fashion brands, like Kendra Scott have converted a number of their stores to mini-fulfillment centers. These efforts streamline the process of gathering and preparing customer orders for delivery or pickup, ultimately maximizing operational efficiency and cutting labor costs.

 

Robotics and Lockers

 

Automated pickup solutions like smart lockers provide secure, fully integrated systems to simplify product pickup and create a better customer experience. The Home Depot and Walmart are leading the charge for streamlining the in-store pickup experience for customers in the home improvement and retail sectors. These solutions save customers time, prevent them from paying higher rates for direct shipping, and protect against package theft.

 

Fulfillment Centers

 

Many retailers have automated both customer and associate fulfillment systems in order to reduce order processing times and lower operational costs. Kroger Co. recently partnered with British online grocer Ocado to build as many as 20 automated warehouses in the U.S. for online grocery fulfillment.

These customer fulfillment centers feature digital and robotic technology that, according to Ocado, saves one hour of labor for every 50-item order—no small feat for a segment of retail with thin margins.

 

In-Store Experiences

 

Combining digital with human-centered experience, retailers have leaned into adopting in-store automation. From automated customer support, to personalized in-store marketing (like digital signage and online order fulfillment), technology has evolved to meet changing consumer expectations.

Kroger recently implemented Kroger EDGE, a new, cloud-based signage solution for retail shelves. This IoT-enabled display connects to customer’s shopping list in their smartphones via Bluetooth, where it presents digital pricing, promos, nutrition data, and even notice when a product is local-made.