Since ChatGPT launched in November 2022, artificial intelligence has been an unavoidable topic. Much ink has been spilled on how artificial intelligence will take our jobs (it may displace some workers, but historically, technology creates jobs) or create a Hollywood-style cataclysm similar to Terminator or Battlestar Galactica (not out of the question, but we’re not there yet, which is why we need regulation).
A lot of artificial intelligence coverage has been theoretical: what the technology could do. But how have companies tried to implement it? And what can their experiences teach us?
(Don’t) Just Walk Out
A recent high-profile example of AI in the “real world” is Amazon’s experiment in brick-and-mortar food retail. Its brands Amazon Go (convenience) and Amazon Fresh (grocery) touted their “Just Walk Out” technology. Customers scanned a unique Amazon QR code to enter the store, and then artificial intelligence technology would track what they put in their bag. When they had their items, the customer could just walk out. No check out. No cashier. No line. The receipt would arrive in their email shortly after leaving. Article after article proclaimed that this was the future of retail. Grocery stores would soon be cutting their cashiers and other staff in favor of A.I.
As many well-informed readers may already know, this turned out to not be true. The “Just Walk Out” technology did not work as promised, and relied on a team of data labelers to review 70% of transactions for accuracy (their goal had been a 5% review rate).
It Wasn’t (Just) a Technical Problem
While many articles covered the technical struggles of the Just Walk Out system, there has been less discussion of the customer experience at these stores. Occasionally, articles may have a quote from a dissenting customer who said they felt like the experience was creepy. But largely, they were featured customers who spoke about the stores in glowing terms.
This quote from NPR, however, belies a different story,
“Apparently, many shoppers haven’t bought into the futuristic grocery
experience. Foot traffic data analyzed by Bloomberg Intelligence shows
customers shop at nearby competitors far more frequently than they do
at Amazon Fresh locations.”
Amazon’s target customers appeared to prefer other stores.
A few academics who researched the Just Walk Out customer experience may have uncovered clues as to why:
“The analysis of the results reveals a certain enthusiasm for this technology,
in terms of handling, convenience and freedom, but at the price of a feeling
of embarrassment and doubt because of tracking and the over-control
generated.”
The cashier-less store was alienating. People don’t like feeling watched.
Trader Joe’s: The Anti-Just Walk Out
As a counterpoint to Amazon, Trader Joe’s famously eschews technology. They do not employ artificial intelligence. They don’t even have a loyalty card. In addition, they hire noticeably more staff that the average grocery store—and definitely more than Amazon Fresh or Go. A key part of their brand is that their employees talk to customers.
While hiring more employees sounds costly, it allows Trader Joe’s to deliver customer-centric experience without the expense (and liability) of a more data heavy approach. Trader Joe’s focuses on private label products and has a much smaller footprint than the average grocery store. This allows it to keep costs low. The employees (who are trained to engage customers) then guide shoppers to new products. This unlocks a highly-personalized face-to-face experience that customers could not get from a loyalty card or artificial intelligence.
In every possible way, Trader Joe’s is the opposite of Amazon’s food retail. And Trader Joe’s approach appears to be more effective. It had increased visits last year, while the grocery industry as a whole saw a decrease, and it recently announced expansion plans.
The Bottom Line
FoodserviceIP is not for or against using artificial intelligence. We’re not even against unattended retail. We recently wrote a blog post about how un-manned micromarkets can deliver value to customers. Artificial intelligence and unconventional staffing patterns are both useful tools that foodservice operators can consider as part of their business plans. But don’t use artificial intelligence just because it’s today’s hot topic. And don’t cut staff purely to further your bottom line.
All of your decisions should be informed by engaging staff and delivering value to customers. Artificial intelligence can empower your employees by cutting routine (and boring) tasks and allowing them to focus on more rewarding work. And empowered staff will deliver a better experience to customers. If you choose to go the AI route, do it with a human-centered approach that makes life better for all of your stakeholders. Don’t be Amazon. Be Trader Joe’s.
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