ShopriteX: crossroads of invention

Grab your groceries off the shelf and walk out. That’s the basis of the newest example of retail innovation to enter SA, piloted by the Shoprite Group.

The supermarket chain launched Checkers Rush last month. The store is entirely automated and cashless. Inspired by Amazon Go, the first Checkers Rush — located at its office space above its flagship Checkers Hyper store in Brackenfell, Cape Town — is available for use by Checkers staff on a pilot basis. The company says it’s a way to shop with "no queues, no checkout, no waiting".

Customers scan their phones on entry to the store, shop and go. The company uses artificial intelligence cameras to identify the products taken off the shelves and bills users’ bank cards as they leave the store.

When it first launched in the US in 2016, Amazon Go also piloted the service with its employees first. It used tech such as computer vision, deep learning algorithms and sensor fusion for purchases, checkout and payment.

Shoprite says hundreds of hours of test footage are required to train the algorithms, so it remains an experiment for now.

Checkers Rush falls under a new business unit in the group, ShopriteX, a digital hub that combines data science, technology and innovation to enhance customer experiences. Its mandate includes e-commerce, rewards and personalisation.

ShopriteX employs 250 data scientists and e-commerce and personalisation experts who work alongside Shoprite’s IT division, bringing it to a combined team of more than 1,000.

This is about "precision retailing", and it’s where the group’s growth is expected to come from, says Shoprite CEO Pieter Engelbrecht. "ShopriteX will use our rich customer data to supercharge a ‘smarter Shoprite’ and ultimately fuse the best of digital with our operational strength across the continent."

His comments confirm how big companies have hedged their growth on the collection of customer data.

A spokesperson tells the FM that technology is playing a greater role than ever before: "[We use] lots of applications, not just for consumers but also to assist the business with real-time stock management." Technology plays a large part in how it improves its business operations.

In a country with high unemployment, there are fears that greater automation in the retail sector will replace people’s jobs. Checkers employs 140,000 workers, many of whom are low-skilled cashiers and packers.

And concerns about privacy, in this new rush to acquire customer data, are growing.

Bronwyn Williams, a futurist at Flux Trends, says Checkers Rush invites us to question the trade-offs between privacy and efficiency.

"While the checkout system is indeed convenient, it is interesting to note it is being rolled out to employees first, rather than customers. This implies that the system may be more about attempting to reduce shrinkage [theft] than about convenience," she says.

"How comfortable would you be with your employer having your credit card on file, with prior authorisation to deduct balances?" asks Williams.

It is reminiscent of the system used in China to automatically issue fines to jaywalkers and other perpetrators of misdemeanours, and therefore a glimpse of a future where law and order becomes more and more a case of "computer says no or go", she says.

"That said, from a convenience point of view, perhaps it makes sense to launch the system to the captive audience of staff first; after all, self-checkout shopping for customers may well, in time, be viewed in a similar way to upgrading your home theatre system from VHS to DVD — an improvement along the way to a more automated, more digitised future," says Williams.

So if Checkers Rush is rolled out to the public, will shoppers bite? Williams is not convinced about Checkers’s strategy, given its excellent one-hour home delivery service, Checkers Sixty60.

"From a customers’ point of view, is it not more convenient to simply order from Checkers Sixty60 instead of arranging transport, finding parking and wrangling a trolley? The future of retail is bipolar; retailers need to either double up on convenience or double down on a very human, very tactile experience that is worth leaving the house for."

Shoprite’s latest figures show that Sixty60 has been downloaded more than 1.5-million times, and more than 1.5-million orders have been delivered in under 30 minutes in the past year.

Sixty60’s growth correlates to a report from Mastercard that online shopping has more than doubled in the past two years. According to the "Online Retail in SA 2021" report, total growth for online retail in 2020 was R30.2bn.

Arthur Goldstuck, World Wide Worx MD and principal analyst on the research project, says: "The most astonishing aspect of this total is that it is more than double the R14.1bn reached in 2018. It is also 50% higher than the total forecast for 2020 three years ago, when online retail was expected to reach R20bn by 2020."

The study shows that categories experiencing the highest growth are clothing (56%) and groceries (54%), as well as data and airtime top-ups.

Shoprite says the customer response to Sixty60 has been "exceptional", thanks to its fast service and ease of use. It has plans to further personalise the app.