How are convenience stores getting smarter?

The rise of smart stores around the world advancing the frictionless shopping experience has fostered the perception that the 'smart' aspect primarily derives from how fast customers can complete their purchases. PetrolPlaza discussed with retailers and suppliers what truly makes a store 'smart.'

Smart shopping is often associated with a fast and effortless grab-and-go experience, primarily enabled by AI-based technologies, artificial vision, scanners, and sensors. These smart solutions allow customers to spend less than 2 minutes in a store without the need to queue up or scan products, hence the term 'smart shopping.'

However, while this definition primarily focuses on the checkout experience, it often overlooks other critical aspects of the store. Factors such as the customer experience, maintenance operations, and labor, can also be enhanced by technologies that don’t directly impact the shopping process. Considering these aspects, what truly distinguishes a 'smart store' from 'a store that is smart'?

A matter of cause and effect

A quick look at the dictionary reveals that the usage of 'smart' in this context draws from the American definition of the word, often associated with quick thinking or problem solving abilities. The big difference between the aforementioned dichotomy lies in what this quick-thinking process focuses on.

“A store that is smart uses technology where it makes sense to optimize workflows, staffing, and the customer experience – not simply deploying technology for technology’s sake. Every decision is made with the business, employee, or consumer in mind,” explains Jay Burdette, Senior Director of the Enterprise Process Innovation Center at Panasonic Connect North America.

The “smart factor” hinges on this strategic focus. For instance, Chevron has recently launched a pilot project at its ExtraMile stores, incorporating digital signage, foot traffic analytics, and interactive-AI solutions. This creates a smart environment where customers are actively engaged through dynamic content and empowers operators with valuable data to leverage to gain deeper insights into their customer base.

Amazon's "Just Walk Out" technology established a roadmap for several companies | © Amazon

Fuel retailers have even launched their own concepts to complement fuel sales — Amazon's "Just Walk Out" technology established a roadmap for several companies | © Amazon

This doesn’t translate into every store implementing the same technology. Instead, it underscores the importance of seeing the bigger picture to know where a certain technology can be most effective. It's not merely about the speed of problem-solving but rather identifying the most fitting solution for each unique business scenario.

“This means thinking about operations and workflows, the worker, and the customer as a whole system. The goal is to empower all of them where it makes sense,” concludes Burdette. With this definition in mind, the focus shifts to identifying the technologies that are making an impact across the industry.

The right solution or the right problem?

In today’s hyper-digitized world, many areas of a service station or convenience store can leverage smart technologies in very different ways. Based on what aligns best with their operations, retailers around the world are experimenting with various implementations to improve management tasks, customer service, convenience, and more.

Whether it's an automated fueling arm, a robot barista, floor-cleaning robots, or retail media, the array of technologies only expand opportunities for retailers. With continuous advancements and new tools constantly entering the market, navigating the waves of innovation can be overwhelming. The lingering question is, how does one select the most suitable technology for a particular business?

“There are already many smart maintenance solutions on the market and we’re only seeing the very beginning of how retailers will benefit from them. Overall growth and demographic changes including labor dynamics will demand the retail industry evaluate many of these options,” adds Chris Wetmore, VP of Sales at ICE Cobotics, a Hong Kong-based developer of automated floor-cleaning robots and fleet management software.

The 2020 global report on the smart retail market by MarketsandMarkets projected an estimated market value of $62.5 billion by 2025, nearly tripling from its initial $21.6 billion figure. Expanding on this forecast, consulting company Grand View Research predicts that this sector will grow at an annual rate of 29.1% until 2030, driven primarily by AI, virtual reality (VR), augmented reality, and the IoT.

“Another key tool is inventory management systems. These platforms use technologies such as the Internet of Things (IoT) and AI to monitor stock levels in real time, forecast demand, optimize replenishment processes, and even explore opportunities to expand into new markets,” details Martín Malievac, Research and Development Director at Napse, Latin American-based supplier of omnichannel solutions for retailers.

Borderline, it’s not about the technology but how it fits the retailer’s goals to circumvent challenges or enhance services. “As we progress towards an increasingly digitized future, it's imperative for retailers to embrace change and position themselves at the vanguard of the technological revolution,” adds Malievac. The key lies in embracing it with a purpose.

This purpose can manifest in numerous challenges, each with its own array of potential solutions, even frictionless shopping. “A faster and safer customer experience creates loyalty. When customers know they can stop at your store and don’t have to deal with queues or wait for the cashier to come back from stocking shelves, they are gonna keep coming back,” explains Major Itule, CEO of c-store sector newcomer Major Oil, about how he addresses building loyalty through a quick and reliable experience.

Today’s stores don't necessarily have to rely on providing frictionless shopping experiences to be deemed 'smart.' This aspect can be defined by combining efficiency and innovation to achieve their business goals, transcending mere tech savviness to embody intelligent decision-making.