In another sign that mobile self-checkout isn’t just a fad, 7-Eleven, the world’s largest convenience store chain, has hopped on the hot mobile scan-and-go bandwagon and introduced its own test service to allow customers to skip the checkout line.
After a three-month trial at its Irving, Texas, headquarters store this year, the retailer is testing its Scan & Pay service in 14 more stores in nearby Dallas, with plans to expand it to more cities next year, said Gurmeet Singh, 7-Eleven’s chief digital officer and chief information officer, adding that the company built the prototype technology in-house in just five weeks.
“Americans are spending 30 billion hours waiting in line,” Singh said in an interview. “We asked, ‘How do we disrupt that and redefine convenience?’ We saw a great adoption and feedback.”
With the move, 7-Eleven joins retailers like Dollar General, Kroger and Walmart’s Sam’s Club that also have their own mobile scan-and-pay services. Customers scan barcodes on products such as 7-Eleven’s Slurpees and salads with their phones and pay for their purchases using the 7-Eleven app. The retailer’s service is also integrated with its 7Rewards loyalty program so customers can automatically earn and redeem any available points or coupons when they pay.
The self-checkout service excludes items that require cashier assistance, such as hot foods, financial services and age-verified items like alcohol, tobacco and lottery tickets, 7-Eleven said.
The service also holds international promise, Singh said. “We have a lot of interest from global licensees,” he told me.
The convenience store chain has a total of 67,000 locations in 17 countries worldwide, including nearly 12,000 in North America. About 50% of the U.S. population lives within one mile of a 7-Eleven, the company said.
It had a 28% share of the U.S. convenience store market last year, more than four times the 6% share held by No. 2 Wawa, according to Euromonitor.
With consumers’ increasingly on-the-go lifestyles and growing demand for products and services that save them time, convenience stores and other smaller-format stores are among the bright spots in the brick-and-mortar sector. As a case in point, Amazon last quarter added five more Amazon Go checkout-free stores. The Seattle giant is reportedly considering opening as many as 3,000 Amazon Go stores by 2021.
A Nielsen study released in August said smaller stores, seeing higher growth than larger ones, now represent 25% of fast-moving consumer goods (FMCG) sales and 70% of shopping trips globally. “Shortcuts and automation” are top of mind for consumers, the study said.
When asked if 7-Eleven has plans to adopt Amazon Go-like computer vision and AI technology to be totally cashier-less so consumers don’t even have to scan product barcodes, Singh said that’s not the priority now.
“Our focus is on making consumer experiences better,” he said. “It’s about making them more frictionless. For us, it’s about speed for the customer. I don’t need to involve another set of technology if I can solve the speed issue. It’s really about ‘how do I skip the line?’”
Interestingly, the company’s test found that once consumers get used to the mobile scan-and-pay service, they use it even during off-peak hours when there aren’t any lines, Singh said.
To meet the other convenience needs of today’s consumers, 7-Eleven this year introduced the 7Now delivery service in markets including Dallas, New York and Washington D.C. It has also experimented with using augmented reality to engage shoppers. In addition, in a move that’s reflective of the broader market trend, Singh said 7-Eleven had hired more digital product managers, software engineers and data scientists schooled in artificial intelligence and machine learning to design better customer experience.
“The future of 7-Eleven relies on great merchandisers, operators and the geeks,” he told me. “Everything is under the umbrella of redefining convenience. We are thinking like a software company.”
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