Retail IoT: Co-op adopts smartphone checkout tech in stores

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Co-op shop, scan and go

Shoppers at Co-op supermarkets will soon be able to checkout their own purchases via their smartphones, in a bid to avoid time-consuming queues.

A new app, built on Mastercard’s ‘Masterpass’ secure mobile payments technology, will allow shoppers to use their phone to scan barcodes as they walk around Co-op stores. On finishing, the amounts owed will be deducted from their connected accounts with a single click.

The technology will be introduced alongside conventional self-service tills and manned checkouts.

A Co-operative approach

The Co-op is one of the world’s largest consumer co-operatives, owned by millions of members. As well as being the UK’s fifth largest food retailer, with more than 2,500 local, convenience, and medium-sized stores, it provides legal and financial services.

The Co-op has said that it has seen the use of cash in its food stores diminish rapidly as alternative payment methods have become more popular. Cash transactions have fallen by more than one fifth over the last five years, and by 15 percent in the past 18 months alone.

Matthew Speight, director of Retail Support at the Co-op, said:

Our ambition is to harness technology to deliver the shopping experience that our diverse customer-base requires – when, where, and how they need it. It is all about consumer choices and convenience.

Choice and mutual benefit stand at the heart of the Co-operative’s approach to business at a time when omnichannel retail – linking clicks, bricks, and location-based services – is the goal for many retailers.

In a fiercely competitive space where established supermarkets are locked in battle with new low-cost rivals, the Co-op is eager to differentiate itself as the most convenient of convenience stores.

“We recognise that there are many communities where customers pop in to their local Co-op and enjoy a friendly chat – it’s all part of the service,” said Speight. “Whereas for others, perhaps with a train to catch or on the school run, every second can count as consumers seek increased convenience.”

The quest for frictionless payments

At our Internet of Banking and Payments conference last November, Mastercard spoke about how payments are becoming increasingly frictionless.

The transaction services provider is currently re-positioning itself as a technology company, and sees itself as the perfect partner for the service-based Co-operative approach. Elliott Goldenberg, head of digital payments at Mastercard UK, said:

With the Co-op we are bringing our online and mobile capability, Masterpass, into the physical store, and offering consumers who want a fast and frictionless buying experience, a secure and reliable way to pay.

“By scanning products using Co-op’s mobile app, shoppers can checkout using payment card details securely stored within Masterpass, and leave the store with both the Co-op and them knowing they have paid.”

The ‘shop, scan, and go’ initiative is being trialled in a store at the retailer’s support centre in Manchester. Co-op plans a further trial at a store in Reading – UK home to a number of technology companies, including Microsoft.

If the trials are successful, a wider rollout of the scheme could begin as early as this summer, said the Co-op.

Internet of Business says

Frictionless shopping is becoming increasingly important to customers. Many use their smartphones for their shopping lists, while others compare online and in-store prices from other retailers as they browse.

Flipping between these choice-led processes and the Co-op app could be a convenient way to shop, not to mention an incentive to buy and save valuable time. The result could be greater loyalty to the Co-op brand – the Holy Grail for all retailers, especially in the squeezed mid-market – and a more efficiently run business.

Convenience is the key, not just for cash-rich, time-poor consumers, but also for anyone who is juggling work and family commitments, or living on a tight budget.

For Co-op and other retailers, the opportunities for streamlining go far beyond payment itself. For example, there is scope for integrated shopping lists in the app that check-off items as they’re scanned. Meanwhile, the ability to link membership or loyalty cards to mobile shopping apps would be a welcome departure.

Behind the scenes, it stands to reason that there could be further benefits in terms of more efficient supply chain and stock management processes.

In urban areas, there has been a shift in food-shopping habits, away from the weekly ‘big shop’, and towards a daily top-up approach that requires less planning and results in reduced waste. Co-op’s new service could be at the centre of these more user-focused trends.

Doubtless competitors will be watching with interest to see how secure the system is, what the impacts are on shopper numbers and the bottom line, and whether the system is used or abused.

Read more: Retail IoT: Why Vodafone’s digital fitting rooms are a good fit for Mango

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The post Retail IoT: Co-op adopts smartphone checkout tech in stores appeared first on Internet of Business.

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Vodafone is working with high street fashion retailer Mango on a programme to roll out digital fitting rooms to the company’s biggest stores worldwide.

In the new fitting rooms, shoppers can request different sizes and colours onscreen, and see a curated selection of accessories, complementary choices, or alternative outfits and – crucially – add them to their shopping carts.

The new in-store retail experience is based on a digital-mirror system, designed by Mango and developed by Vodafone in collaboration with Spanish smart systems and IoT specialists, JogoTech.

Saving choices on a smart watch

In the fitting rooms, clothes-tags are scanned – by barcode or RFID – and shoppers are able to contact floor staff directly from the digital mirror, which can switch between mirror and display modes.

Shop assistants receive the customer’s requests in real time on digital watches – and shoppers are also able to use their watches and smart devices to save the details of any outfits they like.

Retail transformation

This is the first phase of a digital transformation project for Mango that is designed to blend online, mobile, and in-store shopping, creating new ways for customers to engage with, and relate to, the brand.

Mango announced earlier this year that sales via mobile devices exceeded those from PCs or laptops for the first time over the Christmas period. Meanwhile, smartphones now account for seven out of ten visits to its online store.

The company now wants to blend the mobile channel with its real-world stores to deepen customer engagement, said Mango’s chief client officer Guillermo Corominas: “This is a really exciting project for Mango. We see the future of retailing as a blend of the online and the offline.”

Vodafone’s Internet of Things director, Stefano Gastaut, added, “This project helps put more power at the shopper’s fingertips and will bring Mango closer to its fashion-conscious shoppers and offer them more options and experiences than a conventional fitting room.”

Mango’s other technology partner, JogoTech, improves business processes by applying technologies that generate “quantifiable added value”, it says.

Its own JogoRoom system blends the digital fitting room concept with analytics and stock control for retailers. It also offers them in-store management facilities, such as the ability to assign requests from the fitting rooms to different zones on the shop floor, or to different assistants’ digital watches.

Smart outfits

Mango isn’t the only organisation looking at smart fitting rooms and enhanced applications for digital mirrors.

A shopper compares two outfits.

In the US, designer clothing giant Neiman Marcus is rolling out a similar system in its stores. Using the digital mirrors, shoppers can see 360-degree views of new outfits, save multiple options onscreen, and switch the colours without physically changing clothes – aka “trying on without taking off”, an augmented reality application.

Neiman Marcus has partnered with ‘memory mirror’ specialist, Memomi, which develops applications across a range of retail types. These include shopping for new spectacles, and previewing different beauty options on their own faces, without having to sit for hours having the makeup physically applied.

Meanwhile, Samsung digital mirror technology has been deployed in hair salons in South Korea, allowing customers to see themselves with different hair styles and colours. The system uses augmented reality, OLED displays, and Intel’s 3D RealSense cameras.

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Internet of Business says

Digital mirrors are not a brand-new technology. For example, in Hong Kong lingerie specialist Rigby and Peller has been deploying smart mirrors since 2015, while Novotel has been installing iFace mirrors in its hotels since 2014, to provide guest information and entertainment. There are many other examples.

However, this new ability to offer customers choice, deepen engagement, cross-sell, and speed up the in-store experience could be transformative for any retailers that can afford the up-front investment, and to link it with their internal stock systems.

Deployed strategically, digital mirrors could be a critical element in smart manufacturing and supply chains, matching stock to demand while reducing waste.

They may also be a data-gathering goldmine – subject to sensitive and transparent handling of customer data, especially when it comes to video. Indeed, the implicit presence of cameras in changing rooms may be a disincentive for some shoppers, and this will need careful management and control. Some retailers deploy them on the shop floor, rather than in private areas, for this reason.

That aside, digital fitting rooms may help retailers to solve a number of problems. One is that many shoppers go into a traditional fitting room once, try on items, and then either buy or leave, losing any opportunity for the retailer to engage with them during those critical moments.

Another is that economic uncertainty is keeping shoppers away from stores, especially those in the stretched mid-market, where differentiation and service are key to customer loyalty. Retail is increasingly about niche and depth on the one hand, and speed and convenience on the other. The mass of retailers that are caught in the middle need help to retain their customers.

In the UK, for example, the Office for National Statistics reported in January that the underlying pattern in retail sales is one of slow growth: just 0.1 percent, with declines across most main sectors. This is why many big names are turning to technology to help.

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New types of retail experience are certainly spreading, particularly in the US. For example, FindMine (“Sell more, work less, stay true to your brand”) is a New York-based venture that uses AI and machine-learning to help shoppers find their ideal outfits online. Luxury menswear retailer John Varvatos already deploys it on its ecommerce platform.

Elsewhere, a range of different apps allows buyers to measure rooms in their own homes and use augmented reality to apply furniture, fittings, and decor to those spaces. As always, the IoT is about data, personalisation, and more efficient, targeted, cost-effective systems.

So blending bricks and clicks with innovative IoT implementations is looking good for retail, especially for shoppers whose hands are always on their mobiles, at home and in the street.

Read more: PAL value chains: how IoT transforms manufacturing and supply

The second annual Internet of Supply Chain (Germany) conference takes place on 15-16 May 2018 in Berlin. Click for details, and to sign up.

The post Retail IoT: Why Vodafone’s digital fitting rooms are a good fit for Mango appeared first on Internet of Business.

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