Tesco’s cashless store bet is a mistake. Here’s why
Earlier this week, we reported that Tesco had opened its first cashless store, situated in High Holborn, London.
Shoppers are able to use the likes of contactless cards, Tesco Pay+ and Apple Pay at self-service tills. Staff will be on hand to help. This builds on a cashless store trial at a staff-only branch in Welwyn Garden City, Hertfordshire.
Also this week, Amazon launched the first Amazon Go Grocery store in its hometown of Seattle. We’re talking about a store with an abundance of cool tech, “great low prices and weekly specials” and no lines or waiting.
Staff are freed up to restock shelves, welcome and help out customers. Oh, and those wanting to use cash can ask to be swiped in. This is due to a growing Stateside backlash against cashless stores. The aim being to stop discrimination against customers who lack access to credit and debit cards.
Tesco, however, is venturing down a different route, with a spokesman saying the High Holborn store would help people pay more quickly. “We are looking forward to hearing customer feedback,” he commented.
Let’s see if the feedback is different to that received by Sainsbury’s in the same part of London. Last year, Tesco’s arch rival ended a ‘no cash, no cards’ mobile self-checkout store experiment at its Holborn Circus Local outlet, admitting that some of its customers were not big fans.
A trial had launched in April, tapping its SmartShop technology. “Take-up was as we had expected – at peak times better than we’d expected – and it’s clear that not all our customers are ready for a totally till-free store,” the retailer said in a statement.
Some customers preferred to pay with cash and card, which sometimes meant they were queuing to use the helpdesk, particularly at peak times of day, it noted.
“This is why we’ve added a manned till and two self-checkouts back into the store so those looking to pay by cash and card can do so quickly and conveniently. We want to be the most inclusive retailer where people love to work and shop, so it’s really important to us that our customers can pay how they want to.”
“Till-free shopping is still available in the Holborn Circus store, as well as eight other convenience stores across London,” it added. “We’ll take the learnings from this experiment to develop our technology even further to help make shopping easier and more convenient for all our customers.”
20%
Tesco has previously said some of its smaller stores in Britain were only receiving 20% of payments by cash. Only 20%? Really?
Ultimately, smart businesses simply take the customer’s money in any form. Because convenience is king in these omnichannel times, right?
And shutting out those who still rely on notes and coins (and there are many Londoners who fall into this category) ain’t a good look either. As Ron Delnevo, Chairman Of The Board at The Cash Learning Partnership, puts it: “Rather surprised Tesco is running this trial, since there will shortly be a law in the UK compelling organisations which accept in-person payments to accept cash.”
Whichever way you look at it, the grocery giant is arguably placing itself on the wrong side of retail history.
