Imagine walking into a retail store and you find that there are no store managers, helpers, and most importantly, no waiting line at the checkout. Well, perhaps soon gone are the days of traditional barcode scanning and waiting in line to pay bills – autonomous stores are revolutionising the collective shopping experience.
Many retail brands ideally prefer autonomous stores, since they have faster checkout processes, provide non-intrusive environments for shoppers, and enable seamless in-store experiences. For example, in July 2022, Puente Enterprises opened Fort Worth Magazine, an autonomous convenience store at DFW International Airport and witnessed a 47% increase in average transaction value, a 25% reduction in payroll costs, and a 33% increase in revenue within the first quarter.
This blog highlights one of the domains of change in the retail industry, Autonomous Stores, discusses why they are gaining momentum, explains how they ensure frictionless shopping experience, and identifies their benefits for retail owners. Autonomous stores and five other domains of change in the retail industry are discussed in more detail in Transforma Insights’ recent report Digital Transformation in the Retail Industry.
Autonomous Stores are a sophisticated retail solution, which can result in fully automated, scan-less, and cashier-less retail stores, ensuring an effortless and convenient shopping experience.
Consumer preferences are shifting rapidly, with shoppers increasingly favouring cashier-less autonomous stores for their seamless, queue-free experience and faster, more efficient shopping, compared to traditional checkout methods. A survey by Avery Dennison of 4,000 consumers in the US and the UK found that around 37% of respondents would switch to a retailer offering a complete check-out free store experience and added that 52% of Generation Z will do the same. A GetApp survey conducted in early 2022 including over 1,000 Canadian grocery shoppers revealed that 73% considered avoiding queues the greatest advantage of checkout-free shopping, followed by 70% who valued faster grocery payments.
Rising labour shortages and increasing labour costs are other factors that are fuelling the adoption of autonomous stores, especially in developed countries. For instance, the US Bureau of Labour Statistics reported that around 924,000 retail trade vacancies were posted in November 2024, an increase of 25.7% YoY. Shortage of labour can have a detrimental impact on overall retail operations which can lead to inefficiencies and poor shopping experiences, eventually reducing profit margins for retailers.
Generally, shoppers enter an autonomous store and log in to their store account using a mobile app. The stores are equipped with a variety of sensors, cameras, smart shelves, and have digital floor plans, all of which rely on digital technologies like computer vision, artificial intelligence, and deep learning. The sensors start tracking a shopper’s movement as soon as they enter and throughout the store and log details about any products (such as shapes, size, and packaging) that are selected by a shopper so that these can be identified. Based on such details, bills are generated automatically, and the amount is debited from the shopper’s account. The shopper does not have to wait in any queue at the checkout counter and can just leave with the products, resulting in a frictionless shopping journey and enhancing customer satisfaction.
In the following sections, we discuss some of the benefits of autonomous stores from retailers’ point of view.
Since autonomous stores can operate around the clock, there is potential to increase a store’s revenue. Moreover, as they do not require human staff, retail outlet owners can save on staff costs. And an overall slicker experience is more enticing for customers. For instance, JuiceBabe partnered with Digit7 and adopted an autonomous shopping solution and reduced bill processing time by 80% and increased its revenues by 45%, while achieving 99% inventory accuracy.
Out-of-stocks products are a constant challenge for retailers, often leading to unnecessary inventory holding. For instance, out-of-stock products cost retailers in the US and Canada a combined loss of USD349 billion in revenues in 2022. Autonomous stores can help to alleviate this problem, since they are often equipped with digital technologies like AI-enabled demand forecasting solutions which help to ensure that products are always kept on-shelf. This results in better inventory management and reduces out-of-stock situations, eventually increasing a store’s profits as well.
The sensors deployed in autonomous stores can help to generate heatmaps (including data about the time spent by shoppers in various sections) and other behavioural information about shoppers. Autonomous store owners can use this information to enhance product density and refine product placement strategies for maximum impact.
Autonomous stores are transforming the retail industry by streamlining operations and enhancing customer convenience. With disruptive digital technologies like AI, IoT, and Hyperconnectivity, they eliminate traditional checkout processes, improve inventory management, and deliver a seamless shopping experience.
