More than 300 exhibitors with eyes on the transformation of the food retailing and consumer goods industries—and the opportunities that transformation promises them—packed the exhibit hall at the Groceryshop conference this month in Las Vegas. What follows are highlights from the show floor.
Retailers have invested some $28 billion in e-commerce and fulfillment options but, according to Robomart CEO Ali Ahmed, haven’t yet solved one of the trip’s core problems: How does a virtual shopper pick their own fresh goods?
What if the store came to you? Ahmed showed off the Milpitas, Calif.-based company’s driverless and cashierless store, which consumers can summon in the manner of an Uber car. The same app will unlock its doors, revealing a selection of goods, and arrange for payment.
The company is gearing up to launch shortly with Stop & Shop, and it is prepared to announce another partnership soon, according to Ahmed. The plan with Stop & Shop is to have the vehicle stocked from a hub store and primarily roam within a range of that store’s neighborhood, lessening logistical headaches that would come with high-speed highway travel. Ahmed envisions hundreds of these vehicles in every major city over the next decade.
Doug Koontz is director of content, strategy and analytics for Edge by Ascential, the London-based firm providing a suite of data-driven insights for retailers and brands. Assessing neighbors on the show floor, Koontz divided the presenters into three broad categories: digital shelf tools; in-store analytics; and “shiny things” such as robotics and automation.
While digital shelf marketing is not new technology, “it is new for those who thought this business would never take off online," he said, predicting more widespread adoption of operational aids in stores, such as tracking technologies and inventory. “We’re underdeveloped on that front."
The rise of micro-pick technologies and robotics indicates that the industry is starting to admit that “you can’t do grocery e-commerce from a 1-million-square-foot warehouse in the middle of Indiana,” Koontz said. “What are the tools and infrastructure we need to effectively do it closer to the consumer?”
As e-commerce offerings such as click-and-collect gain users, efficiently orchestrating service has emerged as a challenge, said Jeff Baskin of Radius Networks' FlyBuy.
FlyBuy, based in Washington, D.C., uses location technology and an associated app to loop in retailers preparing orders and the customers coming to retrieve them, helping to reduce wait times for shoppers while improving efficiency and assuring fresh, prepared and frozen items are picked at the right moment to improve quality. It is being deployed by grocers such as Walmart and Lowes Foods.
A similar “location-as-a-service” offering from Glympse, also on the show floor, launched at Albertsons Cos. stores this month, the Seattle-based company announced at the show.
When it comes to checkout-free technology, is bigger better? As Ran Peled of Israel’s Trigo Vision sees it, size does matter.
The reason computer vision technologies have until now been deployed in small stores, many with fixed inventories, is that they haven’t overcome the computational challenges that big and dynamic stores such as supermarkets present, he said.
“I think the differences between the sizes of the stores you are serving is going to be a very telling element of who's going to scale and get better clients,” said Peled, whose firm is working with a grocery chain in Israel and is reportedly in a partnership with Tesco in England. A $22 million new capital investment was announced at the show.
Why should supermarkets consider this technology? For one, Amazon is headed that way, Peled said. He also insists grocers could stem share loss to alternate formats and win back big baskets that have gone to digital alternatives once they solve consumer pain points that come with congested checkout lines.
Martin Karafilis and Marcel Herz have taught a checkout lane how to recognize what’s on it. Their Tiliter solution utilizes a camera that can recognize fruits and veggies, saving shoppers the torture of PLU codes at self-checkout and providing retailers with a guard against fraud. The Munich-based company has already rolled out its units in Australia and was looking for more adoptees.
At least two exhibitors on the Groceryshop floor were wondering: Why retrofit an entire store for frictionless commerce when a souped-up grocery buggy can do the same?
Veeve, founded by former Amazon engineers in Seattle, has rolled out an AI-powered shopping cart that can recognize products dropped into it and provide retailers with data regarding the shopper's journey and provide them with offers as they go. It is now testing in a Seattle store called India Market. Located just down the aisle, the Brooklyn-based competitor Caper announced it has gathered $10 million in new funding expected to speed a rollout of thousands of its carts to U.S. stores in coming months. Shoppers using Caper carts in test stores are seeing average baskets climb in excess of 10%, co-founder Ahmed Beshry said.
The challenge of executing e-commerce picking efficiently requires a hand with a brain, said Leif Jentoft, co-founder of Somerville, Mass.-based RightHand Robotics, demonstrating the company’s Rightpick2 picker. The robotic arm can recognize products, learn about them, and lift them and place them using the appropriate suction, gripping and AI software. This can address a supply chain pain point in warehouses and pick centers focused on e-commerce, Jentoft said.
Steve Hornyak, the newly named COO of the recently rebranded robotic micro-fulfiller Fabric, predicts that 20% or more of the supermarket industry will eventually go to some form of automated picking as they come to realize that is their best path to profitability in e-commerce. “I see massive adoption coming the second half of next year, accelerating through 2021, and full-bore in 2022,” he said.
The company, which has established U.S. headquarters in New York, has also refined its vision for grocery, saying it would now pursue private “white-label” facilities on the properties of supermarkets vs. an earlier ambition to provide robotics as a service to the channel. Grocers seeing 200 to 300 e-commerce orders a day ought to consider micro-fulfillment, said Horyak. Centers require 15,000 to 20,000 square feet and cost about $3.5 million to get up and running.
Fabric provides what Hornyak called “phenomenal” proprietary software and robotics he promised “soon would become the worst nightmare” for competitors in the space.