2021 – A year of true omnichannel disruption in retail

2021 was not quite as tumultuous a year as 2020, but there were significant omnichannel developments in the world of retail technology.

Customers began returning to stores in 2021 as COVID-19 vaccinations provided at least some protection against the virus. However, consumers did not abandon the digital shopping habits they acquired during 2020 shutdowns. Here are three ways retailers are adapting to heightened demand for an omnichannel shopping experience.

Autonomous checkout

Many convenience and grocery retailers have piloted cashierless stores since Amazon pioneered the format with its Amazon Go store model in January 2018. However, 2021 saw a surge of autonomous checkout rollouts as customers sought to combine the immediate fulfillment of brick-and-mortar with the streamlined shopping experience of e-commerce.

Convenience chain Circle K has been a leader in efforts to retrofit existing stores with different frictionless shopping solutions. In October 2021, Circle K began offering an artificial intelligence (AI)-based, fully checkout-free shopping experience in a Tempe, Ariz. store. Circle K partnered with computer vision platform provider Standard AI to offer a frictionless checkout experience designed to allow shoppers to completely avoid waiting in a checkout line and receive receipts in minutes. 

Circle has also retrofitted six existing stores in the greater Tucson, Ariz. area with checkout-free technology from Grabango. Starbucks went beyond retrofitting by teaming up with Amazon for a brand-new store concept, “Starbucks Pickup with Amazon Go,” which opened in Manhattan in November.

The store is a combination of the Starbucks Pickup format, which primarily accepts orders that are placed through the Starbucks app prior to the customer arriving at the store, and the “Just Walk Out” cashierless technology platform supporting Amazon Go.

Turning into tech platforms

Retailers with a sophisticated proprietary technology lab can develop disruptive, omnichannel solutions that provide them with a competitive advantage. If an in-house-developed solution is good enough, retailers can even sell it to their competitors.

Amazon, is the most prominent example of a retailer which transitioned to tech provider, with solutions such as its Amazon Web Services (AWS) proprietary cloud computing platform, as well as the previously mentioned “Just Walk Out” autonomous checkout system. Other examples of retailers plunging into vendor waters include Target’s Roundel digital ad network and Walmart’s GoLocal same-day delivery service.

Retailers that operate as technology platforms also sidestep the need to bring in consultants, integrators, or value-added resellers. They can develop the exact features and functions they need, while minimizing or eliminating any integration that might be required with existing infrastructure.

Ultrafast delivery

While ultrafast delivery services that fulfill orders in less than 15 minutes are nothing new, before 2021 they were mostly offered in the U.S. on a highly localized basis by smaller platforms. But European fast delivery startup Gorillas, which fulfills online grocery orders in 10 minutes or less, debuted in Brooklyn at the end of May. And Philadelphia-based Gopuff, which provides speedy delivery (in as little as minutes) of immediate everyday needs, is expanding on the West Coast. 

Other examples include Jokr, a 15-minute delivery platform which launched in New York City, and has since initiated operations in Boston. In addition, Buyk recently launched in Manhattan with a promise of fulfilling online and mobile orders in 15 minutes or less, and several other services have followed.

Now the major third-party delivery platforms are starting to get in on the disruptive action. Ahold Delhaize USA is expanding an omnichannel partnership launched with on-demand delivery platform Instacart to provide virtual storefronts which enable delivery of fresh grocery and CPG items in as fast as 30 minutes through Instacart’s Convenience Hub.

Meanwhile, Instacart rival DoorDash is introducing ultrafast grocery delivery in New York City via its DashMart online convenience storefront. Opened in August 2020, DashMart offers household essentials and local restaurant products for on-demand delivery. DashMart stores are owned, operated, and curated by DoorDash, and stocked from both national and local retailers.

Editor’s Note: This is my last Retail Insights column of 2021. It will return Jan. 7, 2022, with a look at technologies poised to disrupt retail in 2022. Thank you for reading and sending comments, and I wish you Happy Holidays and New Year.