Checkout-free tech’s ambitions gets larger as opportunities multiply

For the dozens of technology companies trying to enable shopping without point of sale terminals, making it work in a full-sized store is the path to disruption. But the coronavirus pandemic flipped the script, bringing disruption well before the technology was ready.

Until recently, checkout-free shopping experiences have focused on smaller convenience stores, where foot traffic and inventory are limited. That makes 100,000 square feet — the square footage of most supermarkets — a key threshold.

At that size, it's too cumbersome to custom-build test stores, so any technology would have to work within conventional stores. Giant Eagle and Grabango will soon find out if that’s workable.

The Berkeley, Calif.-based computer vision company last week debuted a 3,000 square foot store in the Giant Eagle chain, which mostly covers the Pittsburgh area. It plans to open a 100,000 square foot location in the coming weeks, making it one of the earliest full-sized stores to support shopping and payment without stopping to check out.

Grabango/Steady State Media

Photo: Grabango/Steady State Media

Grabango and Giant Eagle, which has almost 500 locations, have been working on a checkout-free system for about a year, determining the best mix for the chain’s different footprints, which range from 3,000 square foot convenience stores to supermarkets.

Giant Eagle chose an app-based system, as opposed to a system that supports a variety of tenders in an attempt to simplify consumer usage of the checkout-free system, though the store retains other payment options such as traditional point of sale checkout or self checkout.

Consumers download Grabango’s mobile app and shop similar to a normal visit. Grabango applies machine learning and computer vision to recognize and track items, accumulating a running total. The shoppers finish the order by scanning a code in the app. There’s an option to receive email receipts and access a record of earlier trips.

By using computer vision, an app and AI, the two companies also hope to avoid steps that would add friction to a traditional shopping experience, such as a dedicated check in, or the use of biometric authentication such as facial recognition.

The supermarket layout requires the technology to recognize tens of thousands of SKUs (stock keeping units). To do this, Granbango is installing overhead rails in the store that run machine learning algorithms, attempting to achieve redundancy while using hardware and software that the consumers do not see or engage. It's similar to vehicle recognition technology adapted for stores. The concept is gaining traction for gas station payments, and Grabango is betting it can work in large supermarkets with minimal change for consumers.

“The ‘retrofits’ of the existing stores still have the same design, and that’s conducive to a natural shopping environment. You’re just skipping the line,” said Andrew Radlow, Grabango’s chief brand officer. Giant Eagle did not provide an executive for an interview or comment by deadline.

Grabango predicts the checkout-free option will eventually surpass self-checkout since it requires less of the consumer. “Changing consumer behavior in a grocery store is difficult. Self-checkout shifts the burden from the cashier to the shopper.”

Dozens of technology companies are developing checkout-free technology, which is still largely experimental. Amazon Go and the Microsoft-Walmart partnership are the most recognizable names developing technology, though there are vendors such as Standard Cognition and Zippin that have opened pilot stores and made some early deployments.

The coronavirus has accelerated projects as developers predict consumers and merchants will be more amenable to changes that make it easier for shoppers to avoid crowds.

By linking shopping and checkout back to a mobile app, such as Amazon Go or a store-branded app supported by a technology company, the merchants can also glean more data about shopping. The apps, AI systems and item recognition technologies can track shopping history, consumer preferences and even the amount of time people spend looking at items on the shelves.

But large IT projects are required, placing pressure on firms like Grabango to minimize the amount of work needed to retrofit stores. Amazon has deployed its checkout-free Amazon Go model in a larger, 10,000 square foot store near Seattle, but has also turned to shopping cart technology, which also relies on self-scanning, for bigger environments.

“Aside from Amazon Go and boutique shops that are more a vending machine on steroids than a full-featured cashierless checkout, I am not aware of any fully operational retail implementations of a true cashierless experience,” said Thad Peterson, a senior analyst at Aite Group. “It’s a really hard thing to do, but if they get it right it could change the retail landscape.”