Kagan: Old checkout lanes will choke retail stores
The old days with old ways of doing business are over. Either stores update or risk closing like countless others we have witnessed in recent years. The checkout lane is one example of an area that needs to be updated by every retailer. Either update or you run the very real risk of being a loser in a changing marketplace.
Think about all the chain store closings we have seen in recent years ranging from Borders Bookstore to Circuit City, HH Gregg, Radio Shack and so many others. Add to that all the pressure being put on countless other retailers like Macy's, JC Penney, Barnes & Noble, Abercrombie & Fitch, BCBG and countless others.
Modernization is a very real threat to the traditional retail environment. It is often said that Amazon.com is the culprit. They are, but it's not just Amazon.com. It's also countless others in the same space transforming their corner of the retail world and putting pressure on traditional players.
Amazon.com Whole Foods threaten current retail grocery business
Look at the ways many retailers are responding. Retail stores like Apple, Microsoft, Amazon.com and AT&T Mobility are redefining retail and the entire shopping experience. They have tables and chairs and sessions with employees who guide them, not sell them. There is no traditional cash register. Instead every sale is processed on a tablet like an iPad.
Amazon.com is a good way to illustrate my point. They are not content staying put. They have their eyes on countless other industries. And they want to have the same effect on those industries they had on books and every other business they are in.
The recent Amazon acquisition of Whole Foods is their first step into the retail grocery business. That is a big threat to industry leaders like Kroger and Publix. The retail grocery business should see this Amazon move into their space as the first warning shot.
Either they must adapt, or unfortunately they will face the same outcome as all the other failed leaders in other older industry segments. It's time for an industrywide remake.
Retail checkout lane desperately needs updating
Think about the checkout line as a good example of an area that needs serious updating before it's too late. In recent years grocers started the self-checkout lanes. This was a welcome addition to the shopping experience. It was innovative and helped the customer and that is good.
Unfortunately, this meant the customer was now in charge of the transaction and some stores are much easier than others. Example, Kroger is easier than Publix. It lets you use their self-checkout lanes, swipe your card and check out. You can do things out of order and the transaction still goes through. At Publix, if you don't do every step in the right order, you cannot check out.
This often leaves Publix customers angry and that's the last thing a company should want. Previously happy Publix customers now get angry. That's not good. So, innovation on its own is not enough. It must also improve the customer experience.
Kroger, Publix not keeping ip with Trader Joe's, Sprouts
So, Kroger is better than Publix, but they are not as good as other newcomers like Trader Joe's and Sprouts. These companies let you charge your purchase to your iPhone using Apple Pay or Android using one of their pay programs, without ever touching a dirty keypad. Why don't traditional grocers do this?
That is quick and easy and preferred by the customer. This is what tomorrow looks like. Constant improvement and innovation. If that's the case, why don't grocery leaders follow this path? They are still stuck in the same model of five or ten years ago.
This is the kind of innovation I see Amazon bringing to Whole Foods, which is also easy to use like Trader Joes and Sprouts. This is the path of innovation the grocery industry must be part of before it's too late.
What kind of innovation can we expect in retail?
So, if Whole Foods is already on the cutting edge, what else can we expect going forward now that Amazon is in charge? Plenty. And that's the risk every other retailer is facing today.
The message is clear. Every retailer must either change, adapt, adjust and innovate or get out of the way. The problem is, we haven't seen anything new yet from the traditional players in the grocery industry. I hope they are aware of the threat they now face. I hope they understand they are in the Amazon cross-hairs.
The warning shot has been fired with the acquisition of Whole Foods. Amazon is moving fast into retail. And not just in grocery, but in countless other sectors as well. The entire retail industry is at risk.
So, retail, are you ready? Are you aware you must either change or perish? What's your defensive and offensive strategy? What are your plans? How are you going to WOW your customers and the marketplace going forward? These are the real questions you need to successfully answer before it's too late. The clock is ticking.
Topics: Customer Experience, Customer Service, eCommerce, Marketing, Merchandising, Mobile Retail, Omnichannel / Multichannel, Online Retailing, Shopper Marketing, Supermarkets & Grocery Stores, Top 100 Retail, Trends / Statistics
Jeff KAGAN Jeff Kagan is a Wireless Analyst, Telecom Analyst, speaker, author and consultant. Over 30 years he has followed the Customer Experience through technology like wireless, wire line, telecom, Internet, cable TV, IPTV, Cloud, AI, Mobile Pay, FinTech and more. Email him at jeff@jeffKAGAN.com. www