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Ushering in a New Technological Era: Retail industry goes contactless in COVID times

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Social distancing, masks, and a lockdown. The COVID-19 pandemic is forcing people to stay at home, work from home and buy from home. Despite the lockdown being lifted in phases, the economy beginning to limp back to the ‘new normal’, and non-essential retailers opening shop, the fear of contagion is real. Anxious about the spread of COVID-19, consumers are being cautious about what they touch.

Ushering in a New Technological Era: Retail industry goes contactless in COVID times

The consumer psyche has undergone a permanent shift in the COVID era, the fear of exposure to the virus so high that all shoppers – the ones who are shopping from home and the ones who are bravely venturing out – are demanding safety and hygiene. Factor in supply chain uncertainty with consumer nerves and brands and retailers themselves are working towards providing technology solutions towards contactless commerce.

Small, medium and large scale businesses are all trying to integrate the ‘no contact commerce’ feature in their businesses, keeping their limitations and budgets in mind. Since mid-March, many major retailers have pushed mobile payments as a means to reduce contact. Even small and medium scale vendors who demanded cash are requesting customers to break the norm and use digital payment apps.

No Contact Commerce: The Concept

For now, the one thing that customers are trusting when it comes to shopping is their own phones. When executed properly, consumers can conduct entire transactions on their mobile devices without touching anything else. Businesses – who were picky about the inventory they placed online, saving the best for the store – are now displaying their finest items on e-commerce sites in a bid to promote contactless commerce. Shoppers can view inventory, select, order and pay for their products on their phones, and get everything delivered to their homes.

But this is not the only way to go contactless. For those who are stepping out of their homes to go and shop, mall developers and retailers (both small and big, both in malls and in high streets) are integrating and implementing a whole host of ‘no contact commerce’ concepts:

Self-Checkout Systems: Automated self-service checkouts and secure cash handling machines have been huge successes for retailers, mostly being employed in store by big brands and
retailers. Although not a new trend, selfcheckout systems were earlier used more for convenience and were not essential technology. While brands first introduced this for cost-saving and security reasons, the innovation is proving useful in limiting staff contact with potentially contaminated cash.

Cashless Payments: For merchants who don’t have access to expensive, automated machines, contact with cash can be limited by encouraging contactless card payments for in-store transactions or other remote payment methods. Low-value purchases are made contactless using just a ‘tap’. Higher value transactions often require PIN entry. Moreover, terminals could be sterilized regularly after each and every transaction.

In this COVID era, there has been a huge shift over the digital and contactless payment, in the large format retail stores. In Tier II cities and smaller towns, the number of transactions happening in the contactless mode have increased by 50 percent. In metros, the transactions have increased by 200 percent. It is evident that the sudden leap to contactless payments could lead to a permanent shift in the retail industry. Eight in 10 consumers say they are using contactless methods due to safety and cleanliness concerns.

Online Payments: Encouraging customers to purchase via your website further minimizes interaction and risk. Advance online payments combined with contactless collection or delivery options are a good way to limit exposure for both customers and staff . Shop online and get it delivered has been the normal norm, however shopping online and get the stuff picked from the store without any physical interference is the new norm.

Deliveries & Collections: Implementing a system for collections or deliveries is a good way to reach customers who can’t reach you. In China, big name companies like McDonald’s, Starbucks and have begun stepping up their contactless delivery, collection and payment capabilities to protect workers and customers. India is not too far behind, experienced this innovation as food delivery services like Swiggy and also implemented, ‘No Contact Delivery’ due to the pandemic. The executives would deliver the product and inform the customer by a message to collect it from the respective place.

Why ‘No Contact Commerce’?

According to a global consumer survey conducted by Mastercard in April 2020, ‘the global disruption has led to increased concern from consumers on cash usage and positive perceptions towards contactless due to the peace of mind that it provides. The majority of respondents (82 percent) view contactless as the cleaner way to pay, and contactless payments are up to 10 times faster than other in-person payment methods, enabling customers to get in and out of stores faster.’

The study further goes on to say that, ‘we are in a sustained period in which consumers are making purchases in a very focused way; it’s reinforcing contactless use in markets where adoption is more mature, and it’s stimulating use in newer markets. This trend appears to be here to stay as approximately three quarters (74 percent) state they will continue to use contactless post-pandemic.’

“With such a large proportion of COVID-19 cases being asymptomatic, no contact commerce is the only way forward. It is essential as it has social distancing built into the concept. No contact commerce, hence, minimizes the risk to the staff and the customer,” says Kabir Jeet Singh, CEO & Co-Founder, .

“Going contactless is an essential prerequisite if businesses do not want to suffer in the current times. There is an inherent fear of catching the COVID-19 infection anywhere and from anyone,
even those not showing symptoms. This is why we have introduced a contactless delivery service for our customers. With the lockdown in place, people were unable to move out of their homes to buy their supplies and e-commerce firms became their only options. We could not have gained the trust of the consumer if we hadn’t immediately catered to their demands while allaying their fears. Now, as the country slowly moves out of the lockdown mode, ‘no-contact commerce’ will be an even more important feature for business sustainability. We will be encouraging customers to make all their payments online to avoid any people-to-people contact,” adds , CEO & Co-Founder, ShopClues.

“We are experiencing an unprecedented situation where we are fighting an invisible virus. Physical contact is one of the biggest contributors to the pandemic. This fear has led to a change in consumer behaviour and resulted in the quick adaptation of ‘no contact commerce’ which seems to have become the new normal. No contact commerce is another step towards ensuring customer safety and provides a solution to ensure safe sales during the pandemic without coming in direct contact with their
customers It encourages the customers to maintain social distancing, reduces the risk of spreading the infection, while ensuring business continuity,” explains Farah Malik Bhanji, ,

The Advantages of Contactless Commerce

In these troubled times, where every human and object could be the potential carrier of a virus, contactless retail has many, many pros, the first being zero touch, fast transactions, which enables consumers to reduce contact by moving more quickly through the store and getting out as soon as possible. In fact, businesses who’re not aligning to this new normal stand the risk of alienating their consumers. Some of the other advantages include:

NO CROWDS: The customer doesn’t have to stand in a queue in open or closed spaces and has contact neither with the cashier, doesn’t have to touch cash or bank cards. Everything can be done on the phone. This reduces the risk of spreading the viral infection anywhere, including in restaurants, stores and malls.

CONVENIENCE & LOW TIME CONSUMING: No contact commerce is one of the most convenient and timesaving modesof shopping. Click and Collect, Click and Purchase, Choosing the Delivery Time are options which make this even more convenient.

CONSUMER CONFIDENCE & LOYALTY: People are now adapting to a new reality where uncertainty has led to many lifestyle changes. In these COVID times contactless delivery systems has both business and health benefits. With a visible shift towards e-commerce, going ‘zero touch’ has helped
brands gain customer confidence, reassure employees of their safety, and ensure business continuity.

Technology Making the Impact

There have been many disruptors in the global retail industry but none as permanent and enduring as technology and innovation. New, contactless technologies have become even more important in the COVID era.

As far as contactless payment is concerned, the most common medium is the UPI format. Payment service providers (PSPs) like PhonePe, Google Pay and PayTm, Bhim etc. are available to all retailers and consumers freely. Another option is contactless cards, which were earlier only allowed to be used for transactions below Rs 2,000 but now has an increased limit.

Payments can also be handled via a standalone ‘Payment Request Platform’ that can turn any exchange of payment into a touchless e-commerce transaction. Solutions like Prommt allows sending instant, secure and personalised payment requests to customers via email, mobile and other messaging channels. Payment request systems like these completely remove the need for any physical contact, turning every interaction into a virtual interaction.

The foodservice sector has gone so far as to come up with digital menus and ordering on the table as part of their contactless dining solutions. Customers can view menus by scanning a QR code and order using their phones. This requires no personal interaction.

Aside from viewing menus and ordering on their phones, this sector is offering a lot of cool new innovations. , for example, will soon allow customers to schedule an order for
takeaway, walk into a store at the scheduled time, and leave with the order after minimal human interaction. Aside from this, customers will be able to place orders through an app and automated tea-making machines called Chai Monks will start preparing their order. The popular Indian QSR’s app does away with the need for physical menus apart from providing digital billing solutions.

Food and grocery delivery platforms like Zomato, , Swiggy, and have also latched on to the no touch delivery idea. Aside from encouraging cashless transitions, they deliver food / groceries to customers’ home, deposit them in a designated area/ basket outside their homes and then inform them via calls or messages that their order has been delivered.

Fashion retailers have also jumped on the bandwagon with innovations such as Magic Mirror, Makeover Gif Booths, Digital Fitting Rooms and Virtual Rails – innovations that are directly linked with the contactless commerce. In all these situations, the consumer can walk in to a store and select the product, and then try and buy without any manual or physical help involved.

“As a leading brand, it is very important that you understand your customer very well and ensure 100 percent satisfaction across various parameters: store operations, store hygiene, customer service levels, product feedback, billing experience, online buying experience, after sales service, social media interactions etc. Hence, use of technology to capture all these elements and have balance dashboards to take action are very important,” explains Kunal Mehta, Head IT – Lifestyle Business, Raymond.

“To reduce touchpoints and interactions within the stores will be important without hampering the customer experience. 3D technologies, virtual trial rooms, digital payments and Omnichannel commerce are the key to ensure that the customer experience, in-store sales and safety are taken care off ,” he adds.

The Future is a New Normal

A Black Swan event has suddenly pushed the retail world into a digital, contactless era. The virus, say experts, is a phenomena we will have to learn to live with. Till a vaccine is discovered, social distancing will be the new normal. What retail experts predicted would have happened in the next four to five years,
is now happening in the next four to five months – no touch retail. From payments to pick up, processes have been scrubbed to eliminate the need for any contact – be it between people, touching products, or card machines.

“A great online experience is what’s going to attract customers, so brands and companies will have to innovate and focus more on the digital and virtual experiences. Offline shopping will become a secondary medium, we can expect to see rise in virtual shopping stores, models to try to on clothes through the screen etc. We’re going to witness a renewed revolution of the digital era with newer technologies and applications,” says Rishi Sharma, Assistant Vice President Marketing, and Head Digital of Brand Liva.

Liva, an ingredient fabric brand from the house of Aditya Birla Group, has conducted a consumer study in association with MRM, the digital arm of Mccann World Group and released a research report titled ‘A Brave New World’.

For now, the challenge in front of the retail industry is to bring in and sustain business and the only way brands and retailers can do this now is by shifting to ‘no contact commerce’ in a secure manner.