Smart checkout tech will process $387bn in 2025, says study

The value of transactions processed in retail by smart checkout technologies, where the fixed checkout process is replaced by a frictionless model, will reach $387 billion in 2025.

That is the headline finding from a new report by Juniper Research, transactions of this type will total $2 billion in 2020.

According to the report, ‘Digital Retail Technologies: Adoption, Implementation & Strategy 2020-2025’, the rapid growth will be driven by retailers seeking sustainable business models in the wake of the Covid-19 pandemic.

Juniper said smart checkout technologies provide much simpler user experiences by removing traditional checkouts, embracing a ‘just walk out’ approach.

Amazon’s own ‘Just Walk Out’ technology has supported its Amazon Go stores for several years, enabling customers to swipe an app or credit card on entry, take what they need, and leave without visiting a physical pay point. The technology recognises what has been taken from the shelves and charges the customer accordingly.

Amazon now licences its tech infrastructure to other retailers for use in their own stores. Other retailers have developed their own systems, while Tesco is trialling its version for staff at its UK headquarters.

Juniper said growth in the use of this technology will centre on the convenience segment, where it noted product lines are simpler and implementation costs are lower. It added that such roll-outs will also occur in larger retail chains that can afford the significant investment costs involved.

The report predicted retailers’ drive for efficiency will lead to investments in artificial intelligence (AI) of over $23 billion by 2025, up from just over $5 billion in 2020. Meanwhile, the industry’s need for standardised data for analysis will propel RFID’s deployment, according to Juniper, which said RFID shipments in the sector will surpass 32 billion in 2025 – up from nine billion this year.

Research co-author, Nick Maynard, commented: “To compete with eCommerce disruptors who heavily rely on AI, traditional retailers must adopt AI rapidly to boost efficiency.

“If they fail to do so, they will face a highly commoditised retail market with an outmoded, uncompetitive business model.”