From Pipe Dreams To Golden Opportunities: Where EV And Retail Tech Overlap
Electric vehicles (EV) might still be a small part of the automotive world but are experiencing hyper-growth. Early adopters responsible for creating and driving the technology can give themselves high marks. You might say the same for those who have embraced autonomous checkout for retail locations, such as grocery stores. Hold on — what could EV cars and a frictionless checkout process possibly have in common? Well, to start, they’re both technology visionaries, approaching adoption without focusing merely on cost and focused on long-term ROI and an exceptional user experience.
Visionaries are unique that way. They are confident customers need and want what they’re offering — they just don’t know it yet. It’s why they often lead start-ups and are embraced as industry leaders. They also tend to have a bold way of thinking that can transform pipedreams into golden opportunities.
How The EV Revolution Disrupted The Status Quo
Until Tesla shook up the automotive world, manufacturers had been building vehicles in essentially the same way for nearly a century. Together with Toyota, Tesla became a pioneer in the EV world. The two companies recently hinted they might work together to develop a small electric SUV platform where Toyota would provide the SUV’s skeleton to Tesla, which would provide the electronic control platform and software technology.
It’s true that up until recently, Tesla ranked second to Toyota in valuation. It’s also true both companies disrupted the automotive business and marketing worlds. But where Tesla takes the lead is in its investment in innovation, its vision, and perhaps most importantly, its willingness to take enormous and often costly risks.
Like all disruptors, Tesla was met with varying degrees of pushback from its competitors. Today, however, as the price of EVs and traditional gas cars edge closer to parity, EV sales are meeting or surpassing SUV sales. This indicates consumers are more willing than ever to invest in a market that brings them value.
Staying Relevant In The Modern Retail Industry
The retail world is no stranger to tech disruption, either. Just as with the automotive industry, there were tried-and-true retail strategies in place for decades. While the pandemic has fundamentally shifted the way retail operates, changes were happening in the industry before it occurred. Most retailers understand if they want to remain a relevant player, they need to adopt new technologies.
Many consumers want a seamless shopping experience that satisfies their demands. Long gone are the days where the majority of consumers make a distinction between online and offline shopping. Whether it’s surfing the web or strolling through a brick-and-mortar store, to them, it’s often just shopping. To meet their customers’ desire for a better overall shopping experience, many retailers are investing more in tech and embracing technologies like AI.
Social commerce, shortened delivery times, omnichannel customer journeys and more are what’s behind a lot of major retailers acquiring tech companies. McDonald’s is creating a drive-thru menu that factors in traffic, weather and trending menu items. Walmart acquired an AI solution that collects product reviews to make personalized recommendations to its customers.
If there’s a general theme in all this, it’s convenience. People want and expect it, and in some scenarios, like grocery shopping, they are willing to pay more for it.
Now, shoppers are going into stores with a clear intention to buy and retailers are seeing higher conversion rates. New contactless payments are enhancing the user experience.
The desire for convenience spans all generations. Consumers are continually pushing the boundaries of what technology they expect brands to use to attract and keep their business and loyalty. People want a shopping experience that’s about them, not the retailer. Brands that refuse to embrace this reality are, frankly, destined for obsolescence.
Seamless Payment Innovations
Companies like Amazon, Uber and WeChat have all woven seamless payment into their apps. In an on-demand economy, seamless payment keeps retailers at the top of their game and distinguishes them as true innovators. But while e-commerce continues to grow, it still only represents a small fraction of how consumers shop.
So, retailers with physical locations have two choices. They can maintain the status quo and reject AI-driven technologies because they think the hardware is too expensive; there’s no immediate ROI and their customers are coming to the store anyway. They also tend to be skeptical that the technologies will be viable long-term.
The other option is to explore the idea of becoming an early adopter of systems that deliver the user experience many customers say they want — even at a higher price.
If you decide to navigate a shift to seamless checkout, consider the following:
Build a dedicated team with a wide range of stakeholders to drive change and explore ROI from a retail floor operations perspective.
Invest in today’s resources to build a 10-year plan specifying a digital transformation for the entire brand, and not just for an “innovation flagship store.”
Stop trying to look at all stores as one bucket. Segmentation is essential to choosing the right technology and defining the most impactable customer experience for different locations.
By offering customers a seamless checkout experience, retailers can help improve brand loyalty, strive for operational excellence through the gain of real-time data about inventory and customer preferences — all while avoiding investing in expensive physical infrastructure changes.
An AI-powered checkout system is a scalable technology that can help deliver an appreciable short-term ROI. Just like the trailblazers who invested early in the EV industry and were willing to take the necessary risks, retailers who commit early to frictionless checkout will find they arrive at a brighter future than those who sit on the fence.