How will supermarkets look like in 10 year from now ? Will employees be replaced by robots or won’t there just be any employees left ?
While points of sales are more and more resembling an extension of online businesses with experience becoming more phygital (see an exemple here) and while showrooming is taking up, supermarkets have never changed as fast as today.
The 3 phases of supermarkets’ evolution: a 10-year perspective
We predict that supermarkets’ evolution will be in three phases.
Phase 1 of the retail revolution : in the next 3 years
First of all supermarkets will reduce drastically human presence at checkout. Self-scan and self-payments solutions will be promoted to replace as many cashiers as possible. Consumers will be nudged to change their habits and to do the work by themselves :
- by reducing the number of checkout lines supermarkets will create longer queues that shoppers will be wanting to avoid which will force them into self-scanning and self-payment solutions
- supermarkets will replace existing self-scanning options by one unique solution
- early adopters will be rewarded with extra discounts or extra points on their loyalty card
Phase 2 of the retail revolution : in 3 to 5 years
Online ordering of FMCG products will become more widespread and supermarkets will increase the space dedicated to pick-ups onf online orders. The physical space within the supermarkets will need to be rethought to accomodate more space for new shopping habits. In particular the time spent in the supermarket will decrease sharply.
In 3 years from now Amazon will have a increased market share and local supermarket chains will need to invest in supply chain improvements to cope with the standards imposed by Amazon. Customers will be more impatient than ever and will have zero tolerance for delays. Orders will have to be ready within 60 minutes.
Phase 3 of the retail revolution : in 5 to 10 years
Amazon’s competition will have forced local supermarkets to cut into their costs. Labour costs will be the first to be slashed and technology will enable setting up of the first autonomous stores. The only employees left will be those that will replenish the shelves. Shopping habits will be differentiated. Regular products will be shipped and delivered at home on the same day or will be available for pick-up within 60 minutes. Last-minute purchases will be done in proximity stores that will be mostly autonomous and without human presence.
Ongoing experiments in the retail world: the path to autonomous stores
This is not science fiction anymore. Experiments are ongoing in many countries and not only retailers are testing them.
- Amazon Go was widely publicized and we dedicated an article to it.
- In The Netherlands Ahold is testing a “Albert Heijn” proximity store with no cashier.
- Bank of America is testing a branch with robots
- Wheely’s has launched a 24/7 store with no checkout.
The future of retail in a nutshell
We’ve prepared a thorough article on the future of retail. In will be published in March 2018.
In a nutshell the future of retail will be experential (see our other article on brock-and-mortar businesses that will survive), data-based, full of analytics and strongly connected to e-commerce. If you want to read more, follow this blog and look for our upcoming publication.