Instacart Faces Fresh Competition in Expanding Smart Cart Sector

The battle for smart cart primacy is rolling ahead full steam as segment leader Instacart is challenged by new players looking to break its dominance of the massive omnichannel grocery category.

Among the latest to weigh in, Japanese tech firm Retail AI announced Thursday (Sept. 15) that it was partnering with Toshiba Tec and its ELERA Commerce Platform to scale its cashierless technology to more retailers at a time when more customers are back in stores doing their own shopping.

“The Smart Shopping Cart is Retail AI’s premier solution, which allows shoppers to complete their shopping experience with a smooth self-checkout,”  the joint announcement said, adding that the integration of the two companies expertise was aimed “to deliver increased convenience for shoppers and more efficient operations for retailers.”

Toshiba’s ELERA platform integrates with stores’ own POS and inventory systems, letting retailers create new in-store shopping experiences with a three-pronged solution unifying “core microservices, IoT touchpoints and data analytics” to support innovation and new features.

See: Instacart Acquires Smart Cart Creator Caper AI to Power Omnichannel Tech for Grocery Store Customers

And that’s not the only fresh foray into this fast-growing and futuristic corner of retail. On Monday (Sept. 12) Tel Aviv-based A2Z Smart Technologies Corp. announced a similar pilot for its Cust2Mate Smart Carts with The Mall Group, a top mall operator in Thailand. Fujitsu Open Retail Solutions is another large tech player taking on Instacart two ways, offering both a Instacart style contactless experience, and now piloting in-store smart carts for consumers.

“This is another major milestone for the company as not only does it validate our offering in another region but integrating our solution with another world leading POS system in the form of Fujitsu opens a host of opportunities worldwide,” Cust2Mate CEO Rafael Yam said. “With existing integrations with NCR and Toshiba POS systems already under way, we have made our adoption by retailers around the world a much easier option.”

Navigating Aisles Smartly

In October 2021 Instacart acquired Caper AI, whose smart cart technology is a first mover in the space. In August, Caper CEO and Instacart Vice President Lindon Gao told PYMNTS’ Karen Webster that the vision goes beyond Instacart’s army of personal shoppers to the consumer.

Referring to Caper Cart’s use outside the Instacart ecosystem, Gao said, “By simplifying checkout for customers, now retailers have the capability to take their staff who is usually standing behind a cash register. Now they can walk the floor and assist customers inside the store, enriching that experience. I think ultimately this is going to yield a much higher benefit for the retailers’ top line versus just realizing labor efficiency.”

Stored payment card credentials integrated with carts is “on the roadmap of what we want to potentially build. There are also other features like shopping lists and how we integrate that with Caper,” he added.

See: Smart Carts With Embedded Payments Put Consumers in Control of Checkout

PYMNTS research finds that use of Instacart has held steady in 2022 despite a mass return to in-store shopping, with roughly 20% of consumers shopping for groceries use same-day delivery options at least once a week. Our data finds that Instacart had a strong month in August with 34.4% of grocery shoppers surveyed reporting using the service in the prior 30 days.

A flurry of announcements from Instacart over the past month or so finds the shopping service making a slew of strategic acquisitions and gaining new investment ahead of a rumored initial public offering (IPO) that could happen before the end of 2022. Instacart’s user base reportedly hovers in the range of 10 million consumers. It’s integrated with roughly 350,000 locations.

Used in chains from Walmart to Lowe’s to Target and most heavily focused in grocery, Instacart’s upcoming crop pf competitors tend not to be remote shopping and delivery services a la the Instacart model, but artificial intelligence (AI) powered carts for in-store shoppers who want to find items more easily and check out more seamlessly.

In other words, Instacart’s crop of competitors are empowering in-store shoppers with personal shopper AI smarts to blunt the effect of its current domination of this quadrant of retail tech.

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