Is retail cashing out on PoS?

Last month saw Sainsbury launch the UK’s first till-free store, with its Holborn Circus store in London undergoing a complete refurbishment to remove the checkout area and tills. The three-month trial at the store, where 82% of transactions were cashless prior to the start of the trial, allows shoppers to pay for items with their smartphone and leave the store without having to go to a checkout.

Often, waiting to pay at tills can create friction in the sales process, so removing the hurdles between the customer and the point of sale (PoS) will make queuing a thing of the past and offer a more convenient service for the consumer.

However, there are important process and operational considerations that need to be made, such as loss prevention, theft and managing age-restricted items, which may deter more retailers from adopting a till-free approach. Arguably, Sainsbury’s has made a brave move in adopting new technology to trial the removal of tills from its stores and with so much competition on both the high street and online, it is vital that retailers find new ways to innovate to give customers a seamless shopping experience. The initiative has stirred up much debate about whether it is likely that other retailers will follow suit – so, does this trial mark the beginning of the end for PoS?

Changing the way we shop

The way we shop continues to evolve in line with technological advances, whether that’s in terms of contactless payments or the scan and shop capabilities that we have seen introduced by some stores in recent years. For some, till-free stores are therefore the next natural progression and a sign of the times. With each innovation, shopping in bricks-and-mortar stores has become more convenient and the introduction of till-free stores could be the most convenient development to-date, making the experience faster and smoother. For retailers, it also has the added benefit of freeing up employees to spend more time on the shop floor assisting and engaging with customers, rather than being tied to a till bank.

However, if till-free stores are to become mainstream, retailers have a huge amount of work on their hands. So far, the uptake of the app that allows shoppers to pay at the Sainsbury’s store has been disappointing, demonstrating the amount of cultural and societal changes that need to be made. Culturally, consumer habits dictate the way in which most of us shop and any deviation from the standard will take some getting used to which isn’t going to happen overnight.

Is the future till-free?

The introduction of till-free stores requires retailers to think about the societal, operational and physical implications of doing so. The removal of tills, and even cash, from stores completely isn’t going to be straightforward and retailers must consider operationally how it will work. For Sainsbury’s, this has resulted in removing all age-restricted items from its till-free store, meaning that shoppers are unable to buy alcohol, cigarettes or medicine, for example. Consequently, the experience for shoppers looking to buy those restricted items is far less convenient. Another consideration must be theft and loss prevention. After all, if customers don’t need to interact with staff members or tills, how can you ensure they pay for everything in their basket? Therefore, the physical security of such stores and how retailers can protect their business must be thoroughly thought-out.

A further barrier to till-free stores being adopted across the board is that it’s not something that will be suited to everyone within the industry, whether due to the nature of the brand, the goods being sold or the demographic. Luxury retailers, for example, where part of the experience offered and expected by customers is having items packed and wrapped, may not benefit from this technology. Similarly, brands with older clientele may find that their customers are resistant to change and value the face-to-face nature of the traditional shopping experience. Therefore, removing the PoS could alienate this valuable customer-base and send their business elsewhere.  

Adopting new technology

In reality, one solution won’t be right for every store, so it’s about retailers finding out what works for them, with different models being used dependent on the brand and the people they are serving. Fortunately, there are myriad ways to innovate and offer customers the best experience as shown by the different technology solutions on display up and down the high street, whether that be the use of e-receipts or offers being pushed to customers in-store on mobile apps.

Brands, such as Adidas, have even launched superfan apps which act as VIP loyalty schemes providing highly engaged customers with special offers. This technology is likely to be adopted by an increasing number of retailers in order to push deals and offers to segments of their customer-base.

The high street isn’t alone in finding ways to use technology to innovate with Tottenham Hotspur’s also paving the way. The football club’s new stadium operates a cashless model which has helped to improve the fan experience on match days. The use of cashless systems means fewer and shorter queues and faster service, which is vital to manage the significant peaks on match day.

Sainsbury’s experimentation with technology is a welcome addition to the high street, demonstrating how technology can enhance the customer experience and could be just what is needed to reinvigorate the high street. That said, it’s clear that going till-free won’t be suited to every retailer and PoS is here to stay. Ultimately, retailers must continue to find new ways to innovate that allows them to offer their customer-based a greater level of experience.

However, retailers should be wary of jumping straight to technology solutions. Instead, the more important discussions being about what business problem the retailer is trying to solve or what experience they want to provide. Once that has been determined, they can then begin to think about how to solve it from either a technology or non-technology standpoint and build from there.

Chris Griffiths, managing partner for customer experience, REPL Group