By Pragati Verma, Contributor
At retail stores powered by Moby Mart, there’s no staff, no cash, and no checkout line. Instead, there is an autonomous supermarket on wheels—on demand. Like an Uber, users can call up a Moby by using an app on their smartphones.
To enter the physical store, registered customers swipe a QR code on their device. To make a purchase, shoppers scan groceries and other items into the app, and as they leave, the store automatically charges their credit card. And while there is currently no sales representative on staff, engineers at Moby Mart are working on adding an artificial intelligence powered holographic shop assistant to help with purchases.
Founded by Swedish designer, Per Cromwell, the 24-hour solar-powered mobile store technology has the potential to change the way consumers think about shopping. It is also shaking up the grocery industry at large. “Are you a retailer?” the Moby Mart website provokes, “Contact us and find out about the future.”
Swipe, Grab, Go
While Moby Mart’s floor-to-ceiling glass storefront may look futuristic, a beta is already up and running in Shanghai. According to Cromwell, the city was an easy choice, as mobile users there tend to trust a purely digital exchange.
Chinese retailers, such as Alibaba, have already set up smart stores that use machine learning, biometric recognition, and sensors to track customers and their purchases, he explained. And several more smart stores are expected to arise in China over the next couple of years.
“China is way ahead in embracing this autonomous shopping experience,” Cromwell asserted. “This is probably driven by the popularity of mobile payment systems, such as Alipay and WeChat Pay.”
By next spring, Moby Mart will also be active in the United States and Sweden. For Cromwell, this expansion is intuitive. “This is a more efficient and cheaper way to cater to people looking for products for immediate consumption, such as milk and bread,” the Swedish designer said.
But Cromwell is not the only innovator banking on local autonomous stores to change the face of the grocery business. Amazon, with its recent acquisition of Whole Foods, is betting on the success of Amazon Go stores, where customers grab what they want and walk out, the system later billing their Amazon account.
BingoBox, a 24-hour cashier-free convenience store that just raised $14 million plans to set up 5,000 smart stores within the coming year. And Hangzhou Wahaha Group, one of China’s largest beverage companies, launched a partnership with DeepBlue Technology that will unveil one million TakeGo automated vending machines in the next 10 years.
Flipping the Cost Model
Moby Mart’s emergence into the digital retail scene could fundamentally alter the way people engage with retail products and service. And in doing so, it could also reshape the cost dynamics of convenience stores.
“Staff, restocking, and real estate are the three biggest costs in retail,” Cromwell explained. “Our stores are mobile and can go to areas where customers live, work, and shop without paying high rentals of prime locations.”
For example, a Moby could be parked outside of a business area during the day, in a residential area at night, and move to a football stadium during a match—all depending on user demand. “You pay for one store and can sell to customers in [any number of] locations,” Cromwell said.
These unmanned stores also offer more cost-effective and efficient ways to restock. Instead of human employees, Moby Marts use sensors and data analytics software to track inventory. When stock runs low, the self-driving vehicle can simply return to the warehouse to replace the entire shelving unit with a full one.
For this reason, Cromwell points out, the Moby Mart model is much cheaper to run—especially in prime real estate locations. “With a one-time investment in a mobile store, you don’t need to worry about growing rents denting your margins,” he added.
Moby Mart currently sells its carts to retailers for a hefty price—$250,000. As Cromwell and his team develop future models, they expect the price of each vehicle to drop to closer to $60,000.
The New Brick and Mortar
Traditional brick and mortar retailers, too, are restructuring their operations to embrace automation. Family-owned grocery store Shnucks, based in Missouri, Illinois, Indiana, Wisconsin and Iowa, brought in Tally, a slender 30-pound gray robot with two blinking eyes to its St Louis stores.
Made by Simbe Robotics, the robot maneuvers freely around the store, looking for out-of-stock items. It then reports data to the store’s backend operations to replenish missing items.
According to Schnucks vice president of IT Infrastructure, Dave Steck, the robot partners with its human teammates by feeding them real-time information. “This makes it easier for people to do their jobs and keep shelves full for customers,” Steck said.
The ability to collect real-time information about products and customers using IoT and data analytics, could open new opportunities for brick and mortar stores that must compete with the growth in online shopping.
“Technology can change the game for offline stores. Smart, physical stores will be able to minimize friction in buying and create a personalized experience which, until now was only available online.”
— Per Cromwell, Moby Mart Founder
According to a 2017 report by the Food Marketing Institute and Nielsen, physical grocery stores are at a “digital tipping point,” with consumer spending on online grocery shopping set to grow five-fold—to $100 billion—within the next decade.
“Technology can change the game for offline stores,” Cromwell said. “Smart, physical stores will be able to minimize friction in buying and create a personalized experience which, until now was only available online.”
Stores that use emerging technologies, such as artificial intelligence and machine learning, to track inventory and gather data on shoppers’ purchase histories, Cromwell asserted, can soon after offer customized deals and suggestions—just like online stores. Yet for Cromwell, the idea that robots and autonomous technologies will help brick and mortar stores take over the online world, is missing the point.
“Technology is key to bridging the divide between physical and virtual worlds,” Cromwell insisted. For him, the future of grocery sales—and retail in general—is rooted in a seamless integration between the online and offline experiences. To do this right is to provide logistics and data across the value chain.
“We need a new model of retail, where you order online and a physical store comes to your neighborhood, at a pre-decided time, and recognizes you with face-recognition technology before it lets you [select] the product,” he said. “I believe that mobile and autonomous stores is where the two models will merge and create a truly omnichannel experience.”