After the Civil War, American retail boomed. Due to a shortage of staff, merchants often hire strangers to assist customers in collecting payments. With little control over transactions, theft and embezzlement of cash is rampant. Things took a turn for the better in 1879 when the Ritty brothers patented their “integrity cashier” — which effectively marked the birth of the point of sale. Since then, technology has continued to reshape the point of sale, but it remains the focal point of all retail.
At the same time, e-commerce is redefining the point of sale by providing a complex, integrated experience from browsing to checkout. Will technology bridge the gap between online and brick-and-mortar stores? A quick recap can give us a better idea of the road ahead.
Attract and retain is the name of the game
All retailers want to provide an atmosphere that attracts customers, encourages them to browse, and makes checkout easy. Opinions on the ideal store layout to achieve this, including grids, racetracks and free-flowing floors, have varied over the years. But a checkout is still the destination of all customer traffic.
The point of sale has evolved with new payment options and additional services. First came cash, then checks, and then a dizzying array of card and digital payments, all of which added convenience. Commerce is also seizing the opportunity to offer new services by offering credit and installment options, an old idea that has now been further developed. In the 1870s, Singer sewing machines were sold for “$1 less per week, $1 per week” with “installment plans”—an early manifestation of what millennials call “buy now, pay later.”
The point of sale is an opportunity to increase customer convenience, add value and create a positive brand impression. If you do it right, customers will come back for more. But how is e-commerce disrupting and evolving the point-of-sale experience?
The rise of e-commerce
Central Bank Digital Identity
Online shopping already accounts for around 19.6% of global retail sales, and this share is expected to grow to a quarter of total global retail sales by 2025. [1] People love to shop online, but mobile commerce has exploded, accounting for more than 52% of all e-commerce spending by transaction value. [2]
Omnichannel retail is coming of age
The surge in online sales has unleashed unbridled creativity. The customer experience has been reimagined and technology is raising the bar of possibility. People are back in stores as the world recovers from the pandemic, but retail has changed forever. The physical and digital worlds have converged, and people expect the same sophisticated experience in stores as online, with easy browsing, minimal latency, and seamless payments.
As online shoppers, people are used to self-checkout, and many retailers offer self-checkout for efficiency. However, the transition to self-checkout has not been easy: it brought challenges related to product scanning, age verification and an increased risk of theft. Also, some customers are reluctant to work at the checkout, which they see as the retailer’s job. Can technology help?
Connected store
Like all businesses, brick-and-mortar retailers need to embrace technology to work smarter, deliver a great customer experience, and control costs. Retail is fast becoming an ecosystem activity for many players along the value chain.
For example, retailers can leverage the power of IoT to automate and optimize inventory. With the right technology, retailers can turn to just-in-time inventory control. In practical terms, this means that there is enough inventory to fulfill an order without having to keep a warehouse. Retailers can also share inventory with customers and notify them when items are sold out or in stock. Everyone benefits.
The Checkout of Tomorrow
Smart Shopping provides shoppers with an app to scan, pack and go in-store. This provides a personalized fintech approach to in-store shopping that can enrich it with recommendations, price comparisons and other useful data. If buyers are willing to serve themselves, they can take advantage of online stores.
In-store self-service kiosks
As retail stores become more digitized, brick-and-mortar stores can leverage touchscreen displays to create a more connected, interactive shopping experience. Digital kiosks allow shoppers to browse, order and check out online, and allow retailers to display inventory, compelling content and advertising.
Store kiosks are validation of interactive sales and provide a way to up-sell, notify customers of future promotions, and gather feedback.
Mobile cash registers and cashierless
Many stores are investing in employee mobility technology to improve customer experience and increase efficiency. Tablets enable retailers to bring omnichannel in-store experiences to life. From delivering customized offers to customers to making payments, mobile shopping assistants can provide a truly connected personal experience.
Natural development is contactless, shoppers simply collect their items and leave. There are already examples in supermarkets where a combination of cameras and weight sensors can monitor which products customers pick up and then charge them via an app when they leave the store. While this is novel and convenient, it’s likely to be limited to groceries or items that don’t require personal touch.
What’s Next – The Metaverse?
Essentially, the metaverse is a parallel digital reality in which we work, play, and shop. It claims to completely replace today’s Internet. While it’s still in its infancy, shopping on the Metaverse promises to provide a better experience than any brick-and-mortar or e-commerce store. It promises to connect the two and create an eventual third distribution channel.
The Metaverse is a work in progress, but retail has come a long way since the Ritty brothers pioneered point-of-sale. While the way we shop will continue to change, attracting and holding is still the name of the game.
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