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Saturday morning at the next generation of supermarkets will not be
a crowded affair. The shelves will be crammed with groceries and the aisles
free of shoppers. Should a box of cornflakes catch your eye then, at the
touch of a button, it will rotate to display the fine print on its sides.
Press another button and it drops into your trolley. At the end of the trip,
there is no queue at the checkout, no need to unload the goods onto the
conveyor belt and no congested car park. In fact, you won’t even have to
leave the house. The entire purchase can be made from the comfort of your
living room using a modified TV set and remote-control unit. The goods will
be delivered within 24 hours and the bill debited from your account.

This is ShopperVision, which will be launched later this year as part
of an experimental fibre-optic cable TV network now being installed in around
4000 homes in Orlando, Florida. The system offers two-way communication
between the home and TV station and is one of several experiments that could
lead to a nationwide system dubbed the ‘interactive superhighway’ after
Vice-President Al Gore’s information superhighway.

Subscribers’ TVs are connected to computerised consoles which receive
the computer programs needed to run channels such as ShopperVision and transmit
viewers’ requests back to the TV station. The system will be run by the
multimedia giant Time Warner and offers up to 500 channels of films, games,
news, shopping and information services.

ShopperVision will offer a full range of grocery and pharmaceuticals
products, supplied and delivered by a local supermarket and a drugstore.
Apart from a small delivery charge, viewers will pay the same prices as
other customers.

Most grocery delivery services run by British supermarkets in the past
twenty years have failed, even though many stores delivered before supermarkets
started appearing in the 1950s. Customers read through lists of items, ticking
those they wanted, and either posted or phoned in their orders. But the
extra staff needed to answer phones, deal with the post and assemble orders,
made the delivery charges expensive or, if the service was offered free,
forced other customers to shoulder the costs.

Making money

Now a new approach to home delivery could make it viable. Andersen Consulting,
a management consultancy firm, has calculated that delivery services offering
goods at high-street prices could generate almost 4 per cent more profit
than traditional supermarkets if they were based at large distribution centres
located outside towns. Assuming that people actually used the service, it
would be cheaper to run than a supermarket built on a prime retail site.
But how would the deliveries work? If the customer is away during the day,
would the house or flat have to be fitted with secure and possibly costly
cages to hold the deliveries? Not necessarily. Operators could send orders
to convenient collection points such as local garages or railway stations.

Existing TV shopping channels are not geared to selling large numbers
of different low-value items such as groceries. Instead, they sell goods
with higher profit margins. The problem is the random nature of customer
involvement, which means wading through screens of information until you
find the item you want. ‘You just sit there for several hours hoping that
the product you want at the price you want to pay is going to come up on
the screen,’ says James May, director-general of the British Retail Consortium,
a research and lobbying body which claims to represent more than 90 per
cent of the British retail industry. He believes that grocery shopping channels
of this type would not find favour with consumers.

On the other hand, research in the US indicates that interactive channels
such as ShopperVision could make a big impact. According to the National
Retail Federation, which is based in New York, 50 per cent of consumers
who have never used a TV shopping channel would be prepared to use an interactive
system that lets them select products. Furthermore, traditional shopping
centres are becoming unpopular. American shoppers spend an average of four
hours a month in malls and visit an average of 3.5 shops on each trip. By
comparison, in the 1970s they spent an average of 12 hours visiting twice
as many shops. There are various reasons for this discrepancy. Other activities
now compete for the leisure time that used to be spent at the mall. Moreover,
more women work, people eat out more often and so use less groceries, and
when supplies run low, they top them up by going to small corner shops.

To combat the drop in popularity, supermarkets are trying to make shopping
trips more pleasant. Many large stores on both sides of the Atlantic pump
the smell of freshly baked bread from the ovens to the entrance of the store
to attract customers and set stomachs rumbling. Others use the fragrance
of freshly ground coffee. In the weeks running up to Christmas, the scent
of brandy and Christmas pudding may also waft through the aisles. If the
smells cannot be produced on site, fragrance specialists can provide aroma
concentrates for stores to release into the ventilation or air-conditioning
system. For example, the London department store Selfridges uses the smell
of freshly cut grass in its gardening department and a pine scent in its
Christmas decoration department to simulate the smell of Christmas trees.

The right smells might even encourage consumers to spend more money.
One study of sales at a women’s wear retailer in the US found a 15 to 20
per cent increase in the average amount customers spent when the store was
filled with a peach aroma, compared with the previous year when no scent
was used.

Many stores prefer more direct sales techniques, however. Walk through
a modern supermarket in the US and you may be bombarded with brief audio
and visual promotional messages triggered by photo cells as you pass by.
In some stores, TV screens mounted onto shopping trolleys guide shoppers
through the aisles while showing nutritional information about the food
displayed and recipes on how to cook it.

British supermarkets have yet to invest in such technology to attract
customers. Although operators believe that teleshopping and home delivery
could be major developments in retailing, they prefer to wait and see how
the new ventures will affect the market. They say the greater priorities
for investment over the next three or four years are crime prevention, better
stock management and improved store layout.

Safeway, for instance, has worked with the Royal College of Art on an
industrial design project to make stores easier for older people to use.
The results are a far cry from trolley-mounted TVs. Among them are compact
trolleys which carry two baskets, one above the other, in the style of a
golf caddie cart, signs that are more legible, and own-brand products with
packaging that is easier to open. Retailers realise that the customer base
is changing – within 25 years, for example, more than half the adult population
of Britain will be over 50.

But even if stores are easier to use and more pleasant to shop in,
many customers are attracted only by the lure of bargain prices. Given
the recent success of stores and warehouse clubs offering goods at rock-bottom
prices, technology that can cut costs and make shopping easier is highly
sought after. Optical scanning which identifies goods from barcodes were
installed primarily to monitor stock movement more cheaply and with greater
accuracy. But they also speed up transactions for the customer and provide
itemised bills. (In practice, a dexterous cashier can be a source of a
stress for the customer. The ideal scanning speed is about 20 items per
minute – any faster and the customer packing shopping into bags cannot
keep up.)

Conquering queues

Although customers move more quickly through checkouts, queues can still
sometimes stretch into the frozen food aisles. Store managers can safely
predict that their shops will be busier on Saturday mornings, for example,
but other factors such as competitor promotions, the weather, even football
matches can all play havoc with the actual numbers.

One scheme to solve this problem, now being used in the US, is to monitor
the number of customers entering the store in real-time. This gives managers
advance warning of potential queues so that they can staff the tills appropriately.
One system uses infrared beams which customers break as they enter the store,
another employs computer analysis of video stills to count customers and
to monitor their movements. The video can also help expose which parts of
the shop are unpopular, and in need of a redesign. And it allows managers
to see how special displays attracts customers.

Even if stores stay one step ahead of queues, customers still have to
load their shopping into the trolley, unload it onto the conveyor belt
to be scanned and then load it back into the trolley for the trip to the
car park. But in future, customers could choose items and then scan them
with handheld barcode readers attached to the trolley. These display a running
total and allow customers to replace goods should they change their mind.
At the end of the trip, the shoppers plug the scanner into an express checkout
and pay for the goods in the normal way, without having to remove them from
the trolley. To deter customers from slipping unscanned goods into their
trolleys, operators will carry out random checks. An alternative security
system measures the weight of the trolleyful of goods and checks it against
the weight calculated by computer. ‘The problem with judging products by
weight is that a litre of Scotch weighs the same as a litre of mineral water,’observes
John Pellaumail, director of custom engineering at Symbol Technologies,
a Berkshire-based company which has successfully tested scanning in Dutch
supermarkets.

This is not the only way of speeding customers through the checkouts
without unloading. Trolley loads of shopping could one day be scanned in
seconds if barcodes and price tags are replaced by microchips developed
by CSIR, the South African government research and development organisation.
Supertags broadcast a unique radio signal which can be monitored, whenever
they are scanned with radio waves. They were originally designed to be worn
by miners working underground; in an emergency the miners could be counted
electronically as they emerged from parts of the mine. If several miners
were walking close together, each tag would broadcast a different signal.
In this way, the receiver could distinguish each miner.

If Supertags gain acceptance, radio waves will be transmitted and received
by a specially designed checkout that can scan goods in baskets or trolleys
up to four metres away. The system is designed so that tags on identical
products broadcast their signals at different times enabling the receiver
to detect them both. After trials in two supermarkets in South Africa, the
developers claim the system can read 50 products per second with a less
than 1 in 10 000 chance of error. Supertags could also double as an antitheft
system. After the tag has been scanned, it switches itself off while unscanned
tags trigger alarms at the exit.

Supertags may increase the flow of customers through checkouts and improve
security but they are expensive – about 60p each. Unless the tags can be
made in such volume that the price drops to around a penny each, supermarkets
will find it difficult to justify the cost. The British Technology Group,
which is advising the CSIR on marketing the product, says that within two
years retailers could be using the tags on high-value goods – such as CDs,
expensive shoes and videos – where the costs can be absorbed.

In the short term, customers themselves may provide the clues that supermarkets
need to sell more goods. In the US, TV shopping channels and home delivery
operators will collect customer names and addresses which they can then
link with shopping habits. British food retailers have yet to compile information
about the individuals who shop at their stores. If supermarkets can match
names and addresses with buying habits, they could send customers discount
vouchers for goods they often buy, along with details of special promotions
to attract them back to the stores.

With interactive TV shopping channels and home delivery services competing
with easier-to-use supermarkets with shorter queues and faster checkouts,
there is likely to be one certain winner in the battle to sell more goods
to more people – the customer.

Bruce Whitehall is editor of Retail Breakthroughs International.