Google, Amazon, Tesla, major car manufacturers and countless other enterprising startups are racing to dominate the self-driving vehicle market. Everyone wants to be the first to launch mainstream sales and services built on autonomous technology. Rightfully so, the industry is projected to generate billions in sales, improve efficiency and cut delivery costs. The focus right now is to get these vehicles on the road, which according to Tesla and Toyota could happen as soon as later this year or early 2020. Self-driving cars are coming, now industries like retail and food service need to start thinking about how this will impact them.
In-Vehicle Ordering Is Already A Thing
Once consumers can forget about the physical act of driving, they will have hours of free time during commutes and daily errands that can be directed to other activities. Whether they purchase a self-driving vehicle or use an autonomous ride service, this shift will create a unique opportunity for retailers, grocers and restaurants. Car companies like GM have already integrated shopping services into vehicle infotainment systems, allowing drivers to order and pay for items with a tap of the screen in their vehicle. Consumers in autonomous vehicles will become a captive audience for push notifications, grocery reminders and other digital advertising displayed on in-vehicle screens simply because they will not need to keep their eyes on the road anymore.
Consumers Are Drawn To Local Pickup
With the advent of self-driving vehicles, same-day and next-day shipping will lose some of the draw these services currently have on consumers’ purchasing decisions. Why wait a day when a local retailer can have the item ready for you in an hour and when you place your order your car is automatically programmed to take you there at the designated time? This is where e-Commerce is headed when self-driving vehicles take over the roads.
Already, consumers are illustrating their desire for easy local pickup. Digital grocery shopping platforms that allow consumers to place an order online, pull up to the store and have it loaded into their vehicle are now being offered by many major grocery chains. CommonSense Robotics said in a report that at the end of 2018, curbside pickup was available in 45% of Walmart stores, 58% of Kroger stores, 56% of Target stores (up from 0.6% at the beginning of the year), 30% of Ahold Delhaize stores and 21.7% of Albertsons stores. And, according to data from Doddle, 68% of U.S. consumers have shopped using a buy online/pick up in store option, with 50% of people saying they’ve decided what store to buy from based on local pickup availability.
Retailers, Restaurants Will Need In-Vehicle Ads
Knowing that consumers prefer to buy local and are already being primed to shop in their vehicles, retailers, grocers and restaurants need to be thinking about how they will execute advertisements on vehicle screens. On the way to school for morning drop-off, a grocery app could remind a busy parent that the milk carton is empty and to buy dog food. At this moment, grocery stores in the vicinity of the self-driving vehicle could send notifications on milk and dog food sales or push digital coupons. With a tap of the finger, an ad could be selected, an order placed and after drop-off the vehicle could take mom or dad to the store before heading back home.
This example of in-vehicle shopping could be replicated for any type of retailer and any type of buying decision. It could also be linked to a consumer’s browsing history and social media platforms, with pop-up ads for items that were added to a shopping cart appearing when the vehicle is near a store with that item in stock. If a consumer decides to make a purchase based on an ad on the screen the vehicle could again be programmed to drive to the pickup location at a scheduled time.
The Era Of The Backseat Shopper
In the next year or so, as self-driving vehicles become available to consumers and move out of testing phases for ride services, it will be interesting to see how other industries are impacted. Based on current data it seems like autonomous vehicles will create new opportunities for brick-and-mortar retailers to compete with e-Commerce marketplaces like Amazon and Walmart. In-vehicle advertising also could be beneficial for local restaurants and coffee shops that offer digital pre-ordering. One question that remains to be answered, and there seems to be no clear answer to at this point, is who will own the screen in the vehicles, and how that system will be monetized to benefit all parties involved in transactions.
Gary Goralnick, CEO of shopinride, has always had entrepreneurial vision. As a teen in the 80’s he came up with the idea for a retainer cleaner, Teen Clean Ortho-Retainer Cleaner, and sold it to Colgate-Palmolive. Goralnick has spent most of his career investing in commercial real estate and he owns several retail centers, which has given him unique insight into the struggles of brick-and-mortar retail in the digital shopping age. He holds two patents for shopinride linked to in-ride advertising and purchases in autonomous vehicles and believes that driverless technology will rejuvenate the retail industry.