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Wednesday 16 October 2019

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Data protection concerns raised over AI till-free checkouts

Written by Peter Walker
25/07/19

As more and more retailers adopt till-free checkout technology with the help of artificial intelligence (AI), GlobalData has raised concerns about the consequences that this technology could have on data protection.

The analytics firm pointed out that retailers will be able to hold an unprecedented level of in-depth data on consumers through the use of cameras and sensors, including personal details and the mapping of shopping habits from when people enter the store, to when they leave.

It also noted that as data breaches are becoming increasingly common, one on this scale could spell a PR disaster for any targeted firm.

Hakan Demirci, consumer analyst at GlobalData, commented: “If retailers can navigate through the potential data protection issues that are likely to arise, till-free checkouts using AI will offer companies another point of differentiation.

Sainsbury’s and Tesco have been focusing on small scale, locally-tailored stores for some time which aligns with the successful models of both Lidl and Aldi, who both grew sales by 10 per cent and 15.1 per cent respectively last year.”

Sainsbury’s and the Co-operative are focusing on till-free technology that requires user input through a consumers’ smartphone, while Tesco - following the example of Amazon Go - is seeking to implement AI-driven till-free technology, using an amalgamation of sensors and cameras to detect when consumers have purchased a product from the store.

Demirci added: “Despite the fanfare of Sainsbury’s new till-free store in Holborn, GlobalData’s audits of the store this year suggests that shopper footfall is lower than we would have anticipated perhaps suggesting that consumers need more convincing on the benefits of scanning their own products on the go as opposed to using self-checkout."

Recent predictions from Juniper Research suggested retail spend at stores with ‘frictionless payment points’ will grow from an estimated $253 million in 2018 to over $45 billion by 2023.


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