New research for global payments firm Adyen puts a dollar figure on the true cost of long checkout lines in store—and the picture it paints isn’t pretty.
In the past 12 months, 86 percent of consumers polled in Adyen’s study said they’d walked out of a store because the cash-wrap queue was too long, either abandoning the purchase altogether or choosing to buy at another retailer. That behavior’s driving $37.7 billion in potential lost sales on top of another $1.1 billion retailers could have earned if they’d supported the way their shoppers want to pay. Time seems to be emerging as a key metric for convenience: 48 percent said waiting five minutes or more in line to pay is too long, and yet just 35 percent of retailers offer mobile POS and even fewer (29 percent) have self-checkout lanes installed.
“Spendsetters,” a tech-savvy and heavily millennial group, told Adyen they think brands are important, and don’t mind shelling out a premium for an experience they think is worth it (45 percent). Plus, they love shopping (49 percent), especially online (42 percent), and are comfortable using digital wallets such as Paypal, Apple Pay and Google Pay.
Despite their affinity for digital wallets, 59 percent of Spendsetters said they want to pay for brick-and-mortar purchases with a store-branded app, according to Adyen. These shoppers want everything personalized to their needs, such as experiences based on purchase history and preferences (61 percent). In addition, another 72 percent expressed a willingness to shop physical stores more often if they received tailored product recommendations and coupons based on their location, as just 7 percent were satisfied with the recommendations they got from a store employee.
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Adyen uncovered a disconnect between retailers’ and shoppers’ priorities. For example, while 36 percent of shoppers said they’d shop more often if a chatbot on a platform like Facebook Messenger were available and a virtual assistant like Alexa would compel another 24 percent to purchase more frequently, Adyen found that just 13 percent of retailers have a commerce-enabled chatbot and 18 percent can accommodate shopping via smart speakers.
Naturally, Spendsetters are among those leading the demand for bleeding-edge innovation like Amazon Go and other frictionless shopping experiences. They told Adyen they’d be happy to do more of their shopping in stores with “just walk out”-type solutions (75 percent).
Frictionless shopping around the globe
While Amazon Go may be synonymous with innovative shopping in the U.S., Alibaba is helping to lead the charge with frictionless retail and payments in China. Its Futuremart store identifies shoppers through facial recognition, and to begin shopping, consumers scan a QR code with either their Tmall, Taobao or Alipay apps. Alibaba takes the concept a step further, offering discounts to shoppers who are smiling via the “Happy Go” meter.
In Japan, Panasonic and IT services firm Trial piloted the former’s RFID-based walk-through checkout experience at Trial’s experimental test store. Trial president Hitoshi Narakino said in a statement that many retail operations—and especially the payment experience—must be reinvented as Japan grapples with a labor shortage due to the twin phenomena of a declining birth rate and a rapidly aging population.