The rise of artificial intelligence

The rise of artificial intelligence

Today's shoppers demand convenience, so how will AI innovation help shape the future of grocery shopping?

Date:

Thu, 05 Oct 2017

Source:

Make Innovation Happen

(Image source: Starship technologies)

Online shopping, home delivery services and grocery shopping without staff and check-out services: today’s shopper demands convenient, quick and simple shopping experiences. From Alexa to automated home delivery services, artificial intelligence (AI) will be a key innovation in the future, even within the retail sector. 

According to Phil Sealy, Principle Analyst for the market research firm ABI Research, the number of businesses using AI is predicted to grow from 7,000 in 2017 to 900,000 in 2022. By using AI technology, the entire food supply chain could be improved, making grocery shopping more efficient. Amazon Go, Moby the mobile store, self-stocking technologies in warehouses or robots and drones used for home deliveries are innovations that are currently being trialled around the world. AI could be the next wave of consumer shopping.

The future of grocery stores

The three biggest costs in retail are staff, rent and restocking. To improve cost-efficiency in the retail sector, start-up companies have been investing in possible solutions to counter these challenges. 

Morrisons improved its product availability by using the AI technology Blue Yonder to stock shelves, an efficient algorithm system that predicts the exact levels of stock required in each of its 491 stores, across 130 categories and 26000 SKUs. According to Morrisons, there has been 30% less product gaps since using this innovation, also enabling them to improve their predicted Christmas sales. The advantage is that no jobs will be lost by using this technology as employees would spend more time on the shop floor.

Amazon Go opened their first entirely automated store without staff in Seattle in 2017. The slogan ‘No lines. No checkout. (No, seriously.)’ promotes their view of the future for grocery stores. The ‘just walk out’ technology uses cameras, sensors and recognition technologies to make no-cash, no-checkout line and even no-checkout possible for shoppers. Shoppers use an app to enter the store and they then buy products via the app that is linked to a digital shopping card. They are then able to walk out of the store. Amazon plans to open 2,000 grocery stores in the next decade, with plants to soon open Amazon Go stores in the UK. 

Another innovation is Moby, the mobile store that stocks its own shelves and drives itself without needing staff. Launched by Wheely’s, the mobile store is currently performing trials in Shanghai. The store is solar powered and drives itself to customers and spare spots. It is open 24/7 and is accessible via an app. 

According to the consumer behavioural analysts Cancas8, a survey of 2,300 people in the UK found that 50% said that they would not go shopping in a staffless grocery store, while 22% said they would. The main reasoning against it is the frustration and malfunctions of self-service machines.

The future of home delivery services

Not only could there be innovations in retail stores, but innovations in home delivery services are rising constantly. Driverless delivery vans trialled by Ocado, drone air delivery investigated by Amazon Air or delivery robots trialled by Tesco could be part of the food supply chain in future.

The starship robot, a six-wheeled buggy invented by Skype co-founders Athi Heinla and Janus Friis, was launched 2014 in Estonia. A robotic delivery driver for local distribution, Tesco has successfully trialled this robot home delivery technology in London this year and they plan to roll out this technology wider very soon. Based on mobile phone technology, the automated battery-powered robot can carry up to 20kg of grocery bags with a maximum speed of 4mph and up to an radius of 3 miles within one hour. The technology uses nine cameras, diverse sensors and a GPS system to track the target location. It also contains security measures, such as a lock system, sirens and cameras to protect the robot from theft. Customers are able to monitor the progress on a smart phone until the groceries arrive at the destination. To unlock the robot, a code is sent to customer’s app. The Starship company promotes their technology as an environmental friendly option of home delivery that has zero CO2-emissions and is cost-saving, with the costs 10-15 times less than current delivery systems.

Growth opportunities

From automated truck platooning, driverless busses and finger vein payments, the UK is on its way to an innovative economy. Artificial intelligence is a concept that could improve the efficiency within the food supply chain. There is still a lot of research and trials needed to approve technologies so that innovations, such as robots and Amazon Go, can be used on a daily basis. But in future, automated stores and home deliveries, used via smart phone apps, could be the typical way of shopping.

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