Never Put The Smart Cart Before The Store

Every year around this time smart carts start hitting the news. You can almost wind your watch to it. At least that is how it feels anyway. I don’t know if that is really true, but with Groceryshop around the corner this time every year, it does seem a bit more than coincidental. Well-timed PR is still well-timed PR after all.

Case in point: over the last month we have seen two separate U.K. grocers make “first” claims on the smart cart news front. First, we had Waitrose piloting its smart cart from Shopic, which was hailed as “the first time smart carts have been used in a UK supermarket.” And, then, not a week later, Morrisons came out and said that it, too, was piloting Instacart’s Caper Cart, making it the first U.K. grocer to deploy said Caper Smart Carts.

My big question though – why be first? What value is there in that?

Because in this case, and unlike Ricky Bobby, if you are first, you might actually end up being last.

And here’s why.

A Viral Video Inspired Me

Truth be told, I had not planned on writing about smart carts this week. Then, lo and behold, a video clip I put out on social media discussing Waitrose’s smart cart news in our weekly Retail Fast Five Podcast garnered way more chatter than I expected (see video here). At one point, Waitrose employees themselves were even commenting on my take. In the video, as is customary, I offered my frank and direct opinion on why I think smart carts are not a “smart” investment. And, today, I would like to further expand upon that argument. There is only so much one can say in a 1-minute sound byte.

Before I do that though, I just want to get something out on the table. To all the detractors out there, I want to say, just as I told the aforementioned Waitrose team member on LinkedIn – prove me wrong. I love retail technology. I love seeing the industry advance. If I end up being wrong, I will be the first in line to own up to it. I just do not think that, for my money, the average grocer should be investing in smart carts right now, with “right now” being the operative word, as I will explain later.

How Important Are The Problems Smart Carts Solve?

Technology is deployed best when it solves a problem. For all intents and purposes, the two most reported “problems” that smart carts solve are: 1) they help shoppers track their budgets in real-time while they shop 2) they can help to serve up targeted advertising while people shop. The first definitely meets the criteria of a problem, while the latter is anything but. The latter is something that is more desired by the grocer than the actual customer him or herself. Moreover, the first issue can also be accomplished in other ways – e.g. recording prices on one’s phone as one shops. Sure, not as easy, but it is an option.

Which brings me to my next point. If you were to ask the average shopper, “What do you value more? Having the items you want available on shelf? Getting served up great promotions as often as possible throughout the store? Having helpful, well-trained, and happy staff? Or tracking your budget while you shop?” My guess is that the average shopper would prefer all of the preceding options over budget tracking and getting pounded by ads on a cart screen.

The right place to invest is in the stores. The preeminent objective if you buy into this theory, and especially given the macroeconomic factors at play, should be to invest in technology that makes one’s stores run more productively and that saves one’s store employees time, so that store payroll can be redeployed into more value added activities. Not some new smart cart that inherently brings with it a customer (and employee) acclimation problem, too.

The Three Legs Of The Smart Store Stool

There are three areas of investment that I would prioritize before even sniffing the Silicon Valley flatulence of a smart cart: 1) Electronic Shelf Labels 2) In-Store Robotics 3) Intelligent Store Management Tools.

Taken together, these three technologies are the three legs of the stool for any smart store system design. ESLs ensure you are right priced all the time (which is paramount in today’s omnichannel world). They also reduce in-store workload and have a myriad of other use cases as well, from directing the picking location for third-party delivery services to restocking for store associates, just to name a few. All these reasons are why Walmart announced this past year that it plans to rollout ESLs to its entire fleet. 

In-store robotics, on the other hand, is the data recording engine for the entire store. By setting a robot to roam around a store at defined intervals throughout the day, grocers can get a snapshot at the same time, everyday, of the efficiency of their stores, and then take the actions that they most need to take to ensure their inventory is on shelf and that their in-store pricing is accurate for their customers.

But intelligent store management tools?

This may be my favorite of all three because it speaks to my former life, my life as store and district manager for Target. 

How Many Reports Can One Manager Read?

When I moved to the field from Target HQ, I quickly learned that I was going to be held accountable for any piece of data that could be found on what felt like 70 or so different reports. So every morning, not knowing who or when my leaders would show up in my stores, I would attempt to corral all this information. It was nerve racking as hell to say the least.

Fortunately, I had some skill with excel and was able to figure out how to put everything into a framework, one I called S-O-G-T (Sales/Operations/Guest Experience/Team). Each morning I set up automated cut and pastes to populate all the data from these various spreadsheets under one of the buckets within the framework. I then shared the framework with all my store managers and told them that I would hold them accountable to anything that flagged on my much simplified one page report.

But, here’s the thing, I shouldn’t have had to do that. Nor should anyone else.

That is where intelligent store management comes into play. With AI, the systems are now out there to keep every one on the same page across the store base and to direct actions that have the most impact (versus those that are just handed down from HQ). 

Here’s a good example: as a district manager I was oftentimes asked to go in and check for planogram accuracy, and my store managers were too. It was a total waste of time. First, robotics can do it. Second, the store teams could take a picture of any new planogram after setting it and route that picture to all of us digitally. And, third, my time was far better spent on HR-related issues, particularly making sure my stores were staffed and trained appropriately, rather than walking in and making sure that yogurt had the correct number of facings.

Schnucks Gets The Punchline To Joke

Schnucks, the grocer out of St. Louis, is a great example of a grocer that runs on these smart store principles. Schnucks has robots roaming the aisles, it has electronic shelf labels, and it believes in the principles of intelligent store management. It is the single best example of a U.S. grocer running on a smart store “platform.”

But, you know what else Schnucks has? 

Smart carts. Yes, smart carts.

Schnucks began piloting smart carts in 2023 and expanded its test of them to more stores earlier this year. The difference between Schnucks, however, and the many other grocers out there that have also piloted smart carts over the last few years, is that Schnucks literally did not put the cart before the horse. Everything else I mentioned above came first.

The Order Of Operations Matters

Schnucks got the order of operations right. Make the stores more productive, keep the employees happy, and then start the next round of experimentation. Not the other way around.

That is my point. 

Capital budgets are constrained. The question every grocer should be asking before putting money into smart carts is: “Have I checked the box on everything foundational first?” If the answer to this question is, “No,” then a smart cart pilot is probably not the wisest of investments because it ultimately could just add more work onto what is possibly an already overwhelmed store team.

I, for one, never know for certain where one company is on its smart store journey relative to others, nor should I, because companies should keep that information close to the vest, but I try to pay close enough attention to ask the right questions.

And there is a strong case to be made that grocers shouldn’t dare put the smart cart before the store.