7-Eleven meets Amazon Go? How a massive retail chain reimagined checkout
Amazon Go’s cashierless checkout model has made its impact felt across the board, motivating large chains like Walmart and Kroger to respond. But the biggest threat it poses is to convenience and fast-food brands like 7-Eleven.
7-Eleven is deploying its own Scan & Pay technology at 14 stores in the Dallas area, with plans for a deeper deployment in 2019. It predicts that its scale—9,100 stores in the U.S. and 67,000 globally—will push a “redefinition” in the convenience category, according to Gurmeet Singh, Chief Information Officer and Chief Digital Officer of 7-Eleven.
Approaches to removing cashiers from the checkout process vary widely, and 7-Eleven’s deployment more closely resembles the mix of scan and self-service features that Kroger has adopted than the in-store camera-heavy strategy pioneered by Amazon Go.
Amazon's model identifies consumers by their phones but then tracks purchases through sensors installed throughout the store. That's easier to do in a new retail environment designed around the concept than in an established store that would need to be upgraded.
In 7-Eleven's version, shoppers scan bar codes on items to add to their order, and then pay with Apple Pay, Google Pay or a linked debit or credit card. The payment feature is integrated within the 7Rewards loyalty program; geofencing places the feature as an option on the consumer's app upon entering the store.
“Technology is enabling even more convenience, and competitive pressures from online retailers are accelerating the process,” said Rick Oglesby, president of AZ Payments Group. “We should expect the aptly-named convenience stores to feel the pressure first, and to react the fastest.”
7-Eleven shoppers scan a QR code upon leaving the store, and as with Amazon Go, cashiers will be on hand to handle age-restricted purchases.7-Eleven sees its model as an alternative and a way to substantially cut down on shopping time — its marketing pitch includes a promise to always be “first in line.”
“Americans spend 37 billion hours waiting in lines with a significant amount of that being in checkout lines,” Singh said. “The challenge I gave to my team was, ‘How do we disrupt this? How can we enable our customers to skip the line every time?'”
7-Eleven did not answer a question on plans to deploy a full "just walk out" store. The Dallas trial follows a smaller three-month test at 7-Eleven's store inside its Dallas headquarters during which the chain found some user challenges and made some corrections, such as integrating the loyalty app. Other chains such as Walmart have had difficulties with the scan and go model, so 7-Eleven is hoping to eliminate potential glitches before the broader rollout next year.
"Adoption is key to a new shopping experience like Scan & Pay. We learned from our test at headquarters that customers require assistance the first time they utilize the new mobile checkout feature," Singh said, adding support for all products we will be a focus for next year. "We will also be focusing on improving the first-time user experience to let customers taste the benefit of skipping the line without having to go through some of the onboarding steps."
All retailers are thinking about how to optimize customer experience, and experimenting with different approaches to shopping, said Zilvinas Bareisis, a senior analyst at Celent.
“The two things I would be looking to test during such pilots is customer psychology, such as how comfortable are they if there is no actual checkout?” Bareisis said.“Will others think that they are just walking out without paying…and security arrangements, such as how to ensure that somebody has indeed paid for all the goods they are taking.”