Touchless Grocery Payments Attract Fresh Capital
The ongoing move toward touchless payments inside grocery stores got a modest but meaningful boost Thursday when computer vision technology startup Shopic said it had raised $7.6 million in capital via a Series A funding round.
The protections crafted to protect food shoppers from the COVID-19 outbreak has put contactless payments and frictionless checkout experiences into sharper focus. Even before the pandemic, Amazon was striving to take the lead on enabling friction-free grocery transactions supported by computer vision technology inside Amazon Go food retail stores. More broadly, recent Progressive Grocer research anticipates an age of touchless commerce in the post-pandemic world of food retail.
Shopic develops similar technology for small- and medium-sized food retailers — operations that cannot match the investment and research power of Amazon and other giants of the industry. One hurdle to further expansion of sophisticated contactless payment systems involves the general inability of those smaller food retailers — and smaller retailers of all types — to be able to afford in-house expertise to get those projects moving. In a rough way, the situation recalls the challenge faced by many smaller retailers in the early days of e-commerce. They often had trouble finding affordable off-the-shelf online platform technology packages that could also be tailored to the particular needs of each business. And as more transactions moved online and into the mobile realm, a somewhat similar situation also arose in the area of payments.
Shopic intends to fill that gap, at least going by its funding announcement this week.
“Shopic’s platform allows grocery retailers of all sizes to invest in a long term technology infrastructure enabling their existing stores to become completely frictionless, without installing costly hardware on ceilings and shelves and without the need to implement major operational changes,” the company said. “The company’s unique (artificial intelligence) and visual recognition algorithms can automatically identify the items that shoppers put into, or remove from, their shopping carts.”
The new funding from Shopic also speaks to the immediate opportunities brought about during the ongoing pandemic and the need to limit human contact as much as possible.
“Due to COVID-19, consumers are increasingly looking for checkout-free experiences when grocery shopping,” a company spokesperson said. “Shopic’s platform allows supermarkets of all sizes to become completely frictionless, without the installation of costly hardware, vital for grocery retailers to remain competitive throughout this global pandemic and beyond.”
The general idea of contactless payments enabled by computer vision is summed up well by Amazon when describing the Amazon Go shopping experience — an experience that is helping to guide similar efforts, given the influence Amazon has in retail. Such technology enables customers to walk out of the store with their items without going through a checkout lane. “Just Walk Out Technology automatically detects when products are taken from or returned to the shelves and keeps track of them in a virtual cart,” Amazon said. When you’re done shopping, you can just leave the store. Later, we’ll send you a receipt and charge your Amazon account. No lines, no checkout.”
As artificial intelligence algorithms and software that supports computer vision become more sophisticated, it’s a safe bet to expect more such funding announcements and deployments in various types of retail, and for businesses of all sizes. For food retail — a sector of commerce that before the pandemic was generally lagging on contactless payment, mobile and e-commerce evolution — such friction-free payments systems also can offer other benefits, especially to younger consumers and digital natives. As Shopic explained in its funding announcement, “the platform allows retailers to communicate with their customers as they shop, by offering personalized offers and rich product information.”
It’s hardly news that coupons, offers and loyalty programs are vital to food retailers. But it’s also worthwhile to note that well before the pandemic, the push to offer ever more personalized retail experiences of all types was gaining significant steam, thanks in large part to better and more affordable technology. And it’s not unreasonable to speculate that small- and medium-sized grocery operations — always in a fierce struggle for profit and survival — will have to increasingly turn to such technologies to stand out in a crowded field, and do so sooner than later.
Shopic certainly hit those notes in its funding announcement. “By investing in Shopic’s vision and technology platform, retailers can ensure that their investment will scale from frictionless shopping and delivery-related picking to optimized shelf stocking, shopper in-store behavior, reduced shrinkage and improved security over the long term,” the company said.
As for Shopic’s new capital, the funding round was led by IBI Tech Fund, and included existing investor Entrée Capital, among others. An unnamed “strategic investor from the retail industry” also took part. Shopic will “will use the funds to expand its deployments into existing and new leading grocery retailers in the U.S. and Europe, while also investing further in research and development which is based in Israel,” the company said.