Robo retail on the horizon

AikoChihira-robotAre instore customer service staff about to become obsolete?

With robots starting to take over some back-end functions in retail, many wonder if they’ll also sooner or later take over customer interfacing roles as retailers try to cut costs and improve the customer experience.

As PwC digital services leader, John Riccio, points out, retailers are already using robotics. For example, self-service checkouts are a basic form of a robot. But at present, he said most robots in retail are currently working in back of house functions, doing physical and repetitive tasks.

“We see plenty of automation and automated guided vehicles in the warehouses of Australian retailers, which are picking and distributing items.”

Amazon, of course, is a well-known pioneer in using drones, a type of robot, and is trialling them for delivery.

“In fact, Amazon uses some form of robotic process automation (RPA) in every end-to-end transaction, from ordering on its website through to picking the item from the warehouse, invoicing and shipping,” observed Riccio.

Internationally, too, there is a greater move towards the instore use of robots for stock control.

Simbe Robotics in San Francisco, for example, has developed Tally, a robot programed to walk the aisles and take stock levels in one-third the time needed by humans, enabling quick and efficient restocking. Its next step is likely to be sending the data directly to delivery centres for ordering and replenishment.

Similarly, Bossa Nova Robotics, also in San Francisco, is testing its robots, which analyse stock on the shelves and collect data to optimise inventory, in five of the world’s leading retail chains. And, RF Spot in Los Altos, California, has an instore sensing robot that has been used to track and maintain apparel inventory at Tesco stores in the UK.

However, the use of robotic automation elsewhere in the retail industry in Australia is still in its infancy, according to Anton Rossouw, an innovation entrepreneur at Exaptec, which specialises in telepresence robots, which allow users to feel as if they are present at, or to have an effect on, another location.

“In terms of adoption, we are seeing many early innovators in other industries use robots to telecommute from remote places,” he said. “This includes universities and schools for students and lecturer or teacher access, medical facilities, hospitals and aged care for remote access to medical professionals and patients, as well for attending conferences and meetings.”

Outside of Australia, Rossouw said there were some exciting case studies on the use of telepresence robots. In the US, for example, he said Salt Lake City-based Standard Restaurant Supply used telepresence robots across multiple stores to visit remote locations and talk to managers, staff and customers, thereby improving operational efficiencies and reducing travel expenses.

Spreading like robots
The robotics industry is a large and fast growing business. According to the Robotic Industries Association, 31,464 robots, valued at US$1.8 billion, were ordered by North American companies in 2015, up 14 per cent in unit terms over 2014.

And while some of what’s happening internationally may be little more than eye candy or gimmicky, there are some moves to towards enhancing the customer experience that Australian retailers would be wise to keep an eye on. For example:

  •   Best Buy and Lowe’s are using robots to help people find items and, in some cases, to take them to the aisle where the item is located. The Lowe’s OSHbot can speak and understand both English and Spanish.
  •      Budgee is a rolling shopping basket that follows people around and is controlled by a transmitter worn by the shopper.
  •      SoftBank originally introduced its humanoid robot, Pepper, as a store greeter, but is now taking steps towards artificial intelligence, placing Pepper at food stores in France to suggest recipes and assess customer satisfaction.
  •      A robot named ‘Du Mi’ helped people order food and make payments at KFC’s first intelligent robot concept store at an exhibition in Shanghai in April. Du Mi, who has a rectangular head and vase-like shaped body, was smartly attired in a red waistcoat doubling as overalls.
  •      Toshiba’s first humanoid robot has started working at the information desk of the Mitsukoshi department store in Nihonbashi, Tokyo, helping customers to find their way around. This female robot, named Aiko Chihira, speaks only Japanese, but can also use sign language.
  •   Geneva airport has trialled mobile robots to direct passengers to services such as currency exchange, toilets and rail connections.

Human touch remains
However, Brian Walker, founder and CEO of Retail Doctor Group, is quick to point out that retail very much remains a human-to-human experience.

“Robots will play a bigger part in the customer experience as they gain more intuitive intelligence and exhibit some form of reasoning,” he said. “We are really only at the start of the journey.

“From a retail point of view, robots are interesting when they can either enhance the customer experience, or reduce costs – for example, the cost of staff, production and inventory.”

PwC predicts that globally the use of robotics in sales and customer service will rise significantly in the next five years.

“Customer service will rise from eight per cent to 24 per cent and sales from six per cent to 20 per cent,” anticipated Riccio.

“In Australia, it seems most of the interesting robotics activity is in the financial services. Banks seem to be quite ahead of the curve. For example, ANZ has been using RPA to enhance its customer service capabilities. This is more about ‘intelligent automation’ than about mechanical robots. There’s also the strong emergence of ‘robo-advice’ services in the wealth management sector.

“I imagine retailers here will also be more focused on developing this customer service aspect than on delivering physical robots to front of house. A recent PwC study shows that RPA has the potential to dramatically improve the customer experience by, among other things, reducing errors (and therefore complaints), extending service hours, speeding up processing and freeing up staff to focus on customers with trickier issues that genuinely require human intervention.

“Retailers may also look to invest in chatbots (computer programs that mimic human conversations as a way of interacting with customers) for their e-commerce function.”

Rossouw noted that robot technology is advancing fast internationally, with more intelligence and sensors being added and the robots becoming more autonomous.

“We expect to see many more examples of retail service robots emerge in 2017 and will be watching the competitive forces with interest to see which units will be most popular and how prices will drop with increased demand,” he said.

He anticipated that the next generation of mobile robot technologies would include more embedded artificial intelligence, learning capabilities and be able to respond in more social ways with customers.

“These robots will be able to be programmed for enhanced retail customer experiences with abilities to have conversations about suitable products, where to find products, explain product features, lead customers to shelves and check on prices, specials and stock levels,” he said.

“We also expect to see personal robotic shopping carts features to become available. For example, service robots that will be able to follow customers with a shopping basket to add items into, tally up subtotals and answer product queries.”

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