Identifying facts versus fiction in retail robotics
2020 was a year of uncertainties in more ways than one and 2021 are likely to be just as unpredictable. What is certain is the e-commerce growth that the retail industry has and will continue to experience. During the month of June 2020, overall retail web traffic generated almost 22 billion visits, up from 16.07 billion global visits in January.
Furthermore, the number of consumers utilizing alternative shopping options continues to grow, leaving retailers the task of figuring out how to manage the increasing number of orders they need to fulfill while also ensuring enough workers are available to provide an enhanced in-store shopping experience. How retailers manage these shifts in consumer buying habits and utilize their labor is key to remaining competitive and improving operational efficiencies. Robotics is a way to do both, but it is controversial. Here we delve into some facts and some fiction when it comes to utilizing robotics in retail.
Fact: Robots coupled with human workers drive efficiencies
Retail as an industry has the lowest labor productivity, with other industries outpacing it since 1987. Worker output by the hour is not enough for retailers to keep up with the rapidly changing industry and growing consumer demands, which is why many are considering automation. When used alongside human workers, mobile automation (also known as robotic or automated guide vehicles) hold the potential for driving increased efficiencies and helping stores improve workflows. Although some concerns have been voiced regarding robots and the potential they hold for replacing store associates, the truth is that the real value of robots is not linked to the number of shelves they can check stock availability for and how quickly. The real benefit robots offer is in their ability to augment and complement human workers to help retailers analyze their inventory and improve store performance. As one writer from the Harvard Business Review recently put it, “The real benefit of retail robots is the opportunity to capture more granular data about the products on the shelves and customer buying patterns.”
By adding mobile automation to their current operations, retailers are able to dedicate store associates to higher skilled tasks, leaving mobile automation systems to complete more manual and repetitive tasks that would otherwise take up associates’ time. This increase in productivity gives retailers the resources to focus on delivering a better customer experience and drive improved satisfaction, loyalty and safety in-store.
Fiction: Robots are a costly investment
In recent years, Robotics as a Service (RaaS) has taken hold, with many companies recognizing the need to incorporate automation quickly and cost effectively. This shift from incurring capital expenses (CAPEX) to operating expenses (OPEX) has helped decrease the cost of investment for mobile automation. This allows more retailers the opportunity to pursue intelligent automation as a viable solution to improving productivity. Furthermore, allowing companies to pay a monthly subscription fee for their mobile automation system as opposed to buying them upfront creates a lower risk solution and makes it more favorable with retail decision-makers who have yet to incorporate automation. RaaS overcomes risk uncertainties and addresses the lack of experience that some companies have by outsourcing that expertise. And by offering this in a subscription format, RaaS increases agility and flexibility for retailers so they can adapt and scale as needed. It also provides protection for the investment and allows for the disposal and upgrade of the mobile automation system after the initial contract expires. This helps avoid the need to hold lagging technology for a prescribed depreciation period. For solutions like mobile automation, this can be approximately five years. At the end of the day, choosing to invest in RaaS over other costly robotics options offers tremendous value for retailers and could take as little as one month to drive contributions to the bottom line.
Fiction: Robots lack customer acceptance
One thing is certain, consumers have high demands, and those demands are growing. As the use of robots has increased in retail environments, the industry has seen a shift in how shoppers view new technology. According to Zebra’s 13th annual Global Shopper Study, 74% of shoppers agreed that the use of technology can help retailers provide a safe, comfortable, and more convenient shopping experience. Consumers recognize the value retail technologies provide in improving the customer experience. More than anything, these shoppers are looking for skilled customer service, customization and convenience when they walk into brick-and-mortar stores. Failure to provide this level of service will result in retailers losing market share to competitors.
In addition to elevating the shopper experience, robotics can also be designed to navigate in such a way that they seek to “blend” into the background, reducing any concerns stores may have over customers running into them. As Donald Norman said in his book, The Design of Everyday Things, “good design is actually a lot harder to notice than poor design, in part because good designs fit our needs so well that the design is invisible.”
By Mark Thomson, director of retail industry solutions, EMEA, Zebra Technologies
