In our always-on world, consumer expectations in retail have skyrocketed. With the advent of sub- two-hour delivery, where consumers can search for a product, read the reviews, and then get it ordered and delivered within hours, shopping at a physical store can seem like a chore. In fact, in our past research on digital’s impact on retail, we found that consumers would rather wash dishes than go to a retail store.1 Today, consumers increasingly expect that efficient and engaging online experience to be replicated in-store.
At the same time, retailers across the world are facing an onslaught from ecommerce players such as Amazon and Alibaba. We found that while large traditional retailers such as Walmart are fighting their ground by digitizing
and automating their physical stores, only 40% of retailers consider automation a strategic imperative. With nearly half of consumers stating they would shift purchases from a non-automated store to a store with automated technologies if they have a positive experience, automation has become a real battleground.
Fortunately, the technology exists to enhance the customer experience and make physical stores attractive destinations. Automation can help consumers meet whatever their needs are – getting in and out of a store quickly, discovering new and exciting products, or providing an enhanced interaction with a sales associate. It will also help traditional retailers to fight back and ensure they are not driven into irrelevance or obsolescence by the digital natives muscling in on their turf. The fact that our research shows that many retailers are lacking automation at scale means there is a real urgency to accelerate.
This report explores four key themes:
1. Why automation in retail stores appeals to consumers and what technologies they are most comfortable using in-store
2. The benefits that companies are reaping from automating retail stores
3. Why in-store automation depends on winning customer trust and confidence
4. How organizations should think about accelerating and scaling in-store automation.
To examine this topic, we launched an integrated global research study across 10 countries and two dimensions:
• The consumer view: We surveyed more than 5,000 consumers, with the majority of them having visited stores that use automation technologies. The aim was to build a richer understanding of what consumers want from automation.
• The business view: In addition to conducting one-on-one interviews with retail executives, we surveyed 500 of the industry’s executives across five sub-sectors – grocery, fashion/apparel, electronics, home improvement, and quick-service restaurants. The goal was to understand their perceptions of the benefits and challenges of implementing automation in stores.
In this research, we define automation technologies as the in-store use of robots, sensors, cameras, digital signage, electronic shelf labels, or mobile apps to help customers with questions and product information, make payments, enhance the quality of interactions with sales associates, and improve in-store operations such as replenishment, inventory,
and facilities management. More details on the research methodology can be found in the appendix.