The appeal of cashierless stores? Speed and short lines

Dive Brief:

Of the consumers using unattended retail, which includes vending machines, cashierless stores and self-serve kiosks, nearly half use it because it's faster than traditional retailers, according to a recent report from PYMNTS.com and USA Technologies. More than 34% of customers say unattended retail channels offer shorter lines, and 33% say the option allows them to avoid speaking with employees.
The report estimates that about 20.6% of American consumers are interested in non-traditional unattended shopping experiences, but only 6.1% of consumers purchase from them. Out of the shoppers that do use these retailers, 81.7% of consumers want to buy health products through these channels, and 64.1% say they want to buy beauty products, per the report.
Among shoppers using unattended retail, 29.6% use debit cards, followed by credit cards (27.3%) and cash (25.8%). However, if given the opportunity, 34.4% of shoppers indicated they would prefer using credit cards as their primary payment method, followed by debit cards (24.4%) and cash (21.6%).

Dive Insight:

The report from PYMNTS.com and USA Technologies sheds more light on how consumers want to pay for goods and what they're seeking from cashierless stores and other unattended retail environments. The report found that 78.1% of consumers who use digital wallets want to purchase goods from unattended retail channels, and 69.5% of digital wallet users would actually pay more for products if unattended shopping options were made available.

This latest report suggests that cashierless retailers and other unattended retail channels have a long way to go before reaching all of the customers interested in their services. Amazon has been leading the way in cashierless tech expansion through its Go stores, and 7-Eleven is testing out its own cashierless concept in Texas.

As retailers like Amazon and 7-Eleven test and introduce their own cashierless stores, startups are wracking up funding to provide similar technologies for competitors. Zippin, an emerging cashierless tech provider, raised $12 million in December 2019 to open new locations. Trigo, a checkout-free tech provider, raised $22 million last September to expand its technology to larger grocery stores. Plus, Standard Cognition, an AI-backed autonomous checkout company, secured $35 million in funding over the summer to expand its U.S. and international footprint.

For now, consumers aren't buying as much from Amazon Go than they are from other convenience stores, a 2019 report from Earnest Research found. However, the PYMNTS.com report notably points out that, at least for health and beauty brands, cashierless stores and other unattended retail channels present another opportunity to reach consumers.