How retail technology is changing the world during Covid-19

RTIH’s Editor, Scott Thompson, reviews what has been an incredible 18 months for the retail technology space and asks: what will a post-Covid world look like?

We’ve seen a massive acceleration in various existing trends over the past 18 months.

It’s incredible when you stop and think about it.

We've moved quickly into a world where there is very little physical cash (the last time I paid for something with notes and coins was around three months ago).

After years of going nowhere fast, QR codes are now everywhere, and it has become impossible to leave the house without a phone, which, depending on who you talk to, is either a truly amazing or depressing thing.

There has also been a surge in online shopping as coronavirus lockdowns and restrictions dominated people’s lives.

Elsewhere, the buy now, pay later sector is booming, with key player Klarna recently valued at $46 billion in an investment round led by Japan’s SoftBank.

Although critics loom large here. Citizens Advice last week called on the Treasury to urgently regulate this space as it “fears shoppers have been left unprotected and ill-informed during the rapid expansion of the sector”.

Also thriving is the rapid delivery movement, with various startups jostling for attention, perhaps most notably Getir which launched in the UK in January and delivers across London, Birmingham, Manchester, Brighton, Cardiff, Liverpool and Bristol. It expects to operate in up to 15 UK cities by the end of 2021.

The venture recently concluded a Series D funding round, raising over $550 million and taking the company's valuation to over $7.5 billion.

This marked Getir's third round of investment in 2021, with nearly $1 billion raised since the beginning of the year. It is utilising the latest capital injection to fuel its expansion into the United States.

Like BNPL solutions, however, this is a controversial area. For instance, Albinder Dhindsa, the founder of Indian startup Grofers, recently responded to “hate” being directed at his company.

Grofers has been facing a social media backlash, with people claiming that its delivery partners are being exploited.

“I don't want my groceries delivered in 10 or 20 minutes. I would rather that the delivery person takes his time to safely deliver,” said Pooja Prasanna, Deputy Editor at The News Minute.

“Same for my food. Raise your voice. Tell companies like Grofers, Big Basket, Swiggy and Zomato. There is no market for abusing their delivery persons.”

“Grofers delivered groceries within 13 minutes and the co-founder responds back that it’s three minutes too long,” commented entrepreneur Sanket Dangi.

“For god's sake, these are groceries - not life saving medicines. Please don't put unnecessary pressure on the delivery boys just for marketing gimmicks!”

What lies ahead?

It’s the question on every retail tech enthusiast’s lips right now: What will a post-Covid world look like as work and life patterns return to some semblance of normality? 

My feeling is that cash usage will make a come back, and rightly so. Many people, including those on low incomes, still rely on it in their everyday lives. It will, however, no longer be king of the payments world, as Covid has rewritten the rulebook.

People will return to high streets, although high streets will look very different than before.

As Harley Finkelstein, President at Canadian e-commerce platform giant Shopify, recently commented: “Consumers will continue to shop in a hybrid reality of online/offline and brands that cater to this (ie. showing inventory availability online before shopping in-store and augmented reality try ons) will succeed.”

The buy now, pay later space will cool off somewhat as criticisms of it intensify.

And the rapid grocery delivery sector will get a cold, hard dose of reality. There are simply too many startups out there, and too much investor money sloshing around, leading to crazy valuations. 

Also, as former Amazon exec and supply chain consultant, Brittain Ladd, so rightly pointed out in a Linkedin post last week, the challenge for all rapid grocery delivery companies is that none have thus far created a technology platform that truly provides a competitive advantage.

Having said all that, retail technology powered change is undoubtedly widespread, rapid and irreversible.

QR codes, mobile and contactless payments, cashierless stores, social commerce, virtual experiences, agile pureplay upstarts like Shein, traditional retailers like M&S pushing ahead with digital transformation initiatives…all these trends and more are here to stay.

Vive la révolution, I say.