Will Retail’s Next Era Be Touchless?

Data Scout is Localogy’s series that curates and draws meaning from third-party data. Running semi-weekly, it adds an analytical layer to the industry data that we encounter in daily knowledge building. For Localogy original data, see the separate Modern Commerce Monitor™️ series.

Several technologies are getting their chance to shine in the Covid-era. Some aren’t even new, but their adoption curves are inflecting as they align with new-normal demand signals. The question is if their adoption sustains in the post-covid era — a core principle of our Pandemic Silver Linings coverage.

We’ve looked at several examples over the past few months, including curbside pickup, order-ahead QSR, remote communications, and of course the pivot to all-things eCommerce. After lingering around 10 percent of U.S. consumer spending, eCommerce has shot up to almost 15 percent, says eMarketer.

Another technology that could accelerate is touchless transactions, as Neal Polachek examined recently in light of sporting events. This will apply more to the “next normal” than the “new normal” as it will be a key component of the new ways that physical businesses will have to operate as they reopen.

The category of “touchless” is broad, including things like tap-to-pay transactions — again, not a new phenomenon. It will include eye-scans at Clear terminals for airport check-in as I recently experienced. And it will include in-aisle AR to inform shoppers about products without picking them up.

Sports Tech Illustrates Ongoing Touchless Transformation

New Habits

Beyond these logical integrations and speculations, we’ve been collecting data to help triangulate our touchless future. The latest is SYKES’ survey that polled 3,000 adults about their experiences and attitudes towards a variety of contactless technologies — everything from tap-to-pay to curbside pickup.

Among the findings, there’s unsurprisingly an uptick in touchless transactions in the Covid era. Specifically, 11 percent of respondents report using touchless payments like PayPal, Apple Pay or Venmo for the first time in the last five months. This suggests mobile payments have grown 11 percent in new users since March.

Meanwhile, 37 percent of respondents ordered groceries online — including mobile — for the first time. 12 percent have signed up for meal-kit services since March; And 10 percent (17 percent in the 18-24 age bracket) have subscribed to virtual fitness classes such as Yoga, spinning or similar.

The question, again, is if this adoption sustains the long-term.  44 percent of respondents aged 25 to 34 (and 29 percent of 55+ respondents) report they will purchase more items digitally than they did pre-pandemic. 12 percent of all respondents say they’ll only use contactless payments going forward.

3 Local Commerce Technologies that Could Inflect

Ensuring Survival

A related trend that jumps out is cashier-less retail, a la Amazon Go. As we’ve examined, Amazon is intent on rolling out this functionality as a “retail as a service” powerhouse. Just like it did with AWS, this internal asset is being spun out to transform operations for third parties who want to gain a logistical edge.

But now the impetus to adopt is less about future-proofing and more about ensuring survival. In that sense, touchless retail could be one of the many “silver linings” technologies that accelerate several years in just a few months. Its adopters will end up better in the long run through forced transformation.

This accelerated adoption principle will also be the central theme of the upcoming Localogy 20/20 virtual conference. Check out more about the event here.

Will Retail-as-a-Service Transform Local Shopping?

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