How Robots Are Changing the Game for Brick and Mortar Retailers

By Pragati Verma, Contributor

Every day, sleek tower-like autonomous robots with two blinking eyes roll down the aisles at several family-owned supermarkets, Schnucks, based in Missouri. Called Tally, the 62-inch robot looks for out-of-stock, misplaced, mislabeled, and incorrectly priced items, safely navigating store aisles among customers and associates.

Whenever Tally finds the store is running low on an item, it quickly informs employees to restock the shelves. The robot can detect people and objects, such as boxes, shopping carts, and shoppers in its way. If it sees a shopper in its path, it waits for them to pass before starting to scan items on shelves again.

After testing Tally to perform scans three times a day for six weeks, Schnucks discovered that its stores had better insights on how their inventory was processed and managed. That was hardly surprising to Brad Bogolea, co-founder of Simbe Robotics, the startup that created the shelf-scanning and auditing robot, Tally. Instead, what enthused him was the positive employee reaction.

“Let’s face it, manually tracking inventory is nobody’s favorite task,” he quipped, “The workers were able to engage in meaningful customer service and tackle other tasks more efficiently.”

The Upside of Free Time

While Tally’s insights helped Schnucks’ store management better understand its inventory, for Bogolea, the most compelling result had to do with expanding employment.

“Because of the new efficiencies in the store, they were able to hire more employees,” he said. “[They could] determine areas where they truly needed to focus their workforce—whether it was customer service, restocking, or warehouse management.”

Schnucks is not alone in putting robots to work in its store aisles. After testing Bossa Nova robots in a small number of stores in Arkansas, Pennsylvania, and California, Walmart announced plans to expand its use of the robots to 50 locations across the country.

“The shelf-scanning technology frees up time for our associates to focus on what they tell us are the most important and exciting parts of working at Walmart: serving customers and selling merchandise,” said Walmart’s director, corporate communication, Justin Rushing.

“The shelf-scanning technology frees up time for our associates to focus on what they tell us are the most important and exciting parts of working at Walmart: serving customers and selling merchandise.”

—Justin Rushing, Walmart’s Director of Corporate Communication

Retail technologists like Bogolea expect robots to collect insights and redesign in-store customer experience in the offline retail sector, which saw about 6,955 store closures last year—the highest recorded rate of closures in the U.S., according to retail think tank, Fung Global Retail and Technology. Expecting to see 15,000 to 20,000 robots in retail stores in the next five years, Bogolea said, “We hope that retail robotics can be effectively used at scale to create a better shopping experience for everyone.”

It’s not hard to see what makes Bogolea so optimistic. As retailers roll out robots, they expect to maintain stock levels just right and reduce inventory issues that are a huge financial drain on the retail sector. In 2015, retail research company IHL Group released a study that found overstocks, out-of-stocks, and needless returns-of-stock items cost retailers worldwide $1.75 trillion each year.

The data collected by these robots can also be processed, analyzed, and shared with store or chain managers, giving management deeper insights. According to Bogolea, this data can be “cross-tabbed to illuminate performance by shelf position, aisle location, promotion, store location, region and more.” For instance, store managers can rotate product placement and compare robot-collected data to make more informed decisions about where to place products, how to best engage consumers, and the optimal number to stock per item.

Robots like Tally also continuously create maps of the store. “Through these maps, retailers can make better informed planograms—the ideal placement of products on shelves in order to maximize sales—as they know which aisles are most frequently trafficked,” Bologea summed up.

For him, retail robots will help optimize the physical footprint of brick-and-mortar, but that’s not the end of their value. Their sensors will also collect insights into shopping behavior and purchase patterns that, coupled with data analytics algorithms, can be used to offer personalized, one-to-one shopping experiences, not unlike online.

Changing the Game

This ability for brick-and-mortar stores to develop personalized shopping experiences allows them to better compete with online retailers, said Per Cromwell, co-founder of Moby Mart, a startup that makes autonomous, staffless, and mobile convenience stores.

“No online store can replicate the ‘touch-and-feel-the-product’ experience of a real-world, physical store,” Cromwell said. “But an offline store can now offer the frictionless and customized experience of the online world.”

Moby Mart, which has roots in Sweden and China, aims to do this by tracking customers’ purchases, just like in the online world—fine-tuning its product mix and customer experience. As Cromwell pointed out, “this hybrid retail model can change the game for brick-and-mortar stores.”