Automatic Payment with a 'Sseuk' as You Pass By... Maximizing Shopping Experience
Reducing Customer Time and Enhancing Convenience... Saving Labor Costs
Alienation of Human Labor... Also Political Inequality Issues
[Asia Economy Reporter Minyoung Cha] "If you just walk by, payment will be made automatically."
Recently, the hot topic in the convenience store industry is digital transformation (change through digital innovation) utilizing artificial intelligence (AI) technology. Among them is the 'unmanned convenience store,' a culmination of various shopping technologies similar to Amazon's 'Just Walk Out' technology. Introduced as part of efforts to enhance the appeal of individual offline stores amid competition with online retailers, unmanned convenience stores offer an optimized shopping experience. On the other hand, they also raise thought-provoking issues such as the alienation of human labor and political inequality.
According to the industry on the 26th, GS25 recently partnered with BC Card and Smartro to open a futuristic convenience store, 'GS25 Eulji Smart Branch,' at the BC Card Eulji Twin Tower headquarters. They established a 'checkout-free' convenience store using an AI-powered payment system and a personal identification system through QR codes. This is a more advanced futuristic store compared to the industry's first 'unmanned convenience store' launched in September 2018 in Magok District, Gangseo-gu. A total of 34 smart cameras follow customers around, analyzing their movement paths and product purchase behaviors. The payment system is built using facial recognition technology, and about 300 weight sensors are installed in refrigerators and product displays to monitor inventory.
Emart24 also introduced a futuristic convenience store, 'Emart24 Gimpo DC Branch,' last year in collaboration with Shinsegae I&C, a subsidiary of the Shinsegae Group, applying the 'Just Walk Out' technology. Customers can use the SSG Pay app to issue a QR code for store entry and then shop. Payment is completed simply by picking up items without a separate checkout process. However, like GS25, Emart24 also has limitations as it must be linked with specific payment methods such as BC Card Paybook (GS25) and SSG Pay (Emart24).
The domestic unmanned convenience stores benchmark the 'Amazon Go,' first introduced by the US retail giant Amazon in 2018. Founder Jeff Bezos described Amazon Go as "the most advanced form of shopping technology in the world, allowing customers to leave immediately without waiting or checking out. Receipts are also sent directly to the customer's Amazon account."
Amazon Go stores continue to expand based on customer satisfaction. Since opening the first store in January 2018, as of January 2020, 25 stores operate in four cities: Chicago, New York, San Francisco, and Seattle. Two of these are undergoing remodeling. Additionally, one more store is planned to open in the Seattle area. According to Bloomberg, Amazon plans to increase the number of Amazon Go stores to about 3,000 nationwide by 2021.
Once unmanned technology is commercialized, it is expected to reduce labor costs associated with 24-hour operation for convenience store owners. The futuristic stores introduced by GS25 and Emart24, currently at the pilot store level, could lead to commercialization in the future. Conversely, this trend of unmanned and contactless technology based on such advancements faces the issue of alienating human labor.
Amazon Go has previously been embroiled in political inequality issues. Last year, the governments of San Francisco, Pennsylvania, and New Jersey passed laws prohibiting offline stores from refusing cash payments. This is because using the payment application requires a smartphone, potentially discriminating against low-income citizens without phones. Accordingly, the San Francisco store allows unmanned payment but also supports cash payments. Additional service staff were deployed to assist customers without the Amazon app in completing their purchases.
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