LONDON—Tesco, one of the world’s largest supermarket operators, is among several grocers testing cashierless stores that use cameras to track what items shoppers pick up and then allow them to pay by simply walking out the door, reports The Wall Street Journal.
The retailers hope the technology, which is like that found in Amazon Go stores in the United States, will help them to cut costs and shorten lines as they face an evolving threat from the e-commerce giant.
Grocers in the United Kingdom often pioneer new technology, such as online delivery and self-payment kiosks, that American retailers eventually adopt. So, European efforts to scale up the technology will be closely watched in the U.S.
“People [in the U.S.] will definitely take note of Tesco’s experimentation, if only because it shows that someone outside of Amazon is now testing the concept,” said Chris Walton, a former Target Corp. executive and founder of consulting firm Red Archer Retail.
Tesco plans to open its self-styled “pick and go” or “frictionless shopping” store to the public next year after testing the system with employees. The mega-retailer’s 4,000-square-foot test store uses 150 ceiling-mounted cameras to generate a three-dimensional view of products as they are removed from shelves by shoppers.
In a recent demo, Tesco’s system detected shoppers as they walked around the store. It also identified a group of products when a person holding them stood in front of a screen, tallying up the total price. Tesco is considering identifying shoppers through an app or loyalty card when they enter the store and then charging their app when they leave.
Tesco told investors its method costs one-tenth of competitors’ systems, partly because it only uses cameras. Amazon Go uses both cameras and sensors to track what shoppers select. Amazon customers scan a QR code at a gate when they enter a store, then walk out when finished.
French retailer Carrefour SA is conducting tests in at least two stores where cameras track what is taken off shelves, and shoppers are charged automatically when they exit. Carrefour is working with French start-up Qopius Technology, whose cameras and software read labels on products.
It used to be difficult to sell product-recognition technology to retailers, said Vasco Portugal, co-founder of Sensei Tech, a Portuguese startup. “It seemed like crazy technology, and it sounded like magic.” But that changed after Amazon Go launched last year.
Sensei Tech charges tens of thousands of dollars to fit out stores with the computing equipment needed to track products, plus it adds on a monthly fee, said three European grocers that plan to roll out its system this year.
Meanwhile, Israel’s biggest supermarket chain, Shufersal, will deploy similar technology across all its stores if its own trial works out. “The whole notion of waiting in line will vanish,” a spokesperson said.
In a New York store, Walmart is testing artificial intelligence-enabled cameras that can recognize hundreds of products, but only to manage inventory levels. The retailer plans to test its system on a 30,000-item “real-world” store that is nearly the size of a football field, but a spokesperson said it wasn’t testing cameras for purchases.
Kroger last year launched a system that allows customers to scan and bag products as they shop and then pay by scanning a final bar code. It has looked at ideas for quicker payments but hasn’t embraced Amazon Go-style technology, a former Kroger executive said.
Challenges to the technology are expected. Customers may balk at having their movements tracked. Image-recognition technology is also expensive to run in larger stores, requiring enormous on-site computing resources. But the cost of computing power is falling, which makes product-tracking systems more commercially viable. Despite the initial excitement generated by Amazon Go, U.S. retailers are concerned about excluding low-income shoppers who tend to pay with cash. In fact, lawmakers in Philadelphia have banned cashless stories, and other cities are considering similar laws.