Global Head of Self-Service, Retail Division, Diebold Nixdorf
According to a recent McKinsey report, 79% of consumers intend to continue or increase their usage of self-checkout after the pandemic.
When COVID-19 struck, retailers found themselves scrambling to adjust. With little warning, the pandemic demanded massive changes to retail operations.
Store layouts had to be configured to accommodate social distancing. Unprecedented demand for essential products challenged inventory systems. Retailers introduced a variety of new payment methods at checkout. And, according to a recent report from Periscope by McKinsey, in a matter of 90 days, we have vaulted forward 10 years in consumer and business digital adoption.
As a result of the pandemic, many retailers discovered that they lacked the IT agility to implement changes swiftly and effectively, illuminating a challenge that the industry must address so it can thrive moving forward: the need for an open, flexible infrastructure that can adapt to rapidly evolving customer journeys.
OPENNESS IS THE KEY TO BEING FUTURE-READY
While no business is “future-proof,” retailers can take steps to become future-ready. One of the most critical steps is adopting flexible technology systems that enable retailers to adapt quickly to change -- whether due to an unexpected crisis like a global pandemic, or to ongoing subtle shifts in customers’ expectations. Flexible technology enables retailers to introduce new shopping concepts, support new types of consumer journeys, and offer new services and technologies to enhance the customer experience.
Embracing openness allows retailers to keep up with ever-changing consumer expectations. Gone are the days of vendor monopolies and rip-and-replace of existing implementations. Future-ready retailers are open to working with multiple vendors, open in their approach to IT infrastructure and open with regard to business processes. Being open accelerates time to market for new implementations and leads to higher business agility while lowering total cost of ownership (TCO). Openness can also reduce barriers to implementing new technologies in the context of existing IT systems.
In turn, it’s just as critical for technology vendors to adopt an open retailing strategy, leveraging a retailer’s best-of-breed ecosystem to manage processes at maximum efficiency. The concept of open retailing comprises an open IT philosophy and flexible infrastructure. This platform approach, which combines open API software, a modular hardware setup and a flexible services portfolio, allows retailers to upgrade their IT infrastructure at their own pace -- avoiding vendor lock-ins and premature replacement of hardware components. As consumer and staff journeys change over time, these platforms provide the flexibility to evolve technology accordingly.
OPEN RETAILING IN ACTION: SELF-SERVICE
The area of self-service demonstrates how an open approach can support innovation and enable nimble changes to customer journeys. According to the 2020 International Grocery Shopper and Technology Survey, conducted by Nielsen and commissioned by Diebold Nixdorf, 37% of shoppers experienced frustration due to time spent waiting in line.
Of those shoppers, 72% would prefer to use self-checkout when there's a line -- a preference shared by almost two-thirds of grocery shoppers in general. The survey also found that 57% of shoppers use some mobile device at least rarely while shopping in store, and 86% of them would be interested in using a mobile device to accelerate the checkout by self-scanning items. Yet the majority aren't using either their own smartphone or a self-scanning device, but actually both – with varying preferences that might depend on the type of service, local conditions and their personal attitudes toward leveraging technology.A recent McKinsey report on changes in U.S. shopping behavior found that 79% of consumers intend to continue or increase their usage of self-checkout after the pandemic.
Consumers’ desire for self-service options is clear, and in response, that technology is evolving rapidly. In many retail environments, solutions from a variety of vendors combine to create an ecosystem that includes touchless payment terminals, image recognition, voice control, smart security scales, hand-held scanners and/or smartphone apps, just to name a few. Open and nimble IT infrastructure isn’t just an internally focused idea, but also a demand for strategic partners to enable retailers to embody this philosophy. Flexible IT infrastructure supports a seamless, nimble and efficient approach to implementing self-service and other technologies to satisfy consumers’ evolving expectations.
Once the COVID-19 pandemic fades, the need for adaptability in retail will be here to stay. By embracing an open approach, retailers can increase their readiness for future changes in this rapidly evolving industry.