Will the tech behind Amazon Go redefine convenience at retail?
The reports that Amazon.com was working on a new type of convenience store have proven true with the opening of the first Amazon Go location in downtown Seattle. The big question now is what the format will mean for Amazon’s business and rivals in the convenience channel and beyond.
The 1,800-square-foot store, which operates without checkouts, will initially serve Amazon’s customers in a beta testing phase before opening to the public sometime early next year.
Shoppers scan their Amazon Go mobile app as they enter the store. Anything they take from the store’s shelves are automatically added to their virtual shopping cart. If they put an item back, it is removed from their cart in the same fashion. When customers leave the store, Amazon automatically bills their accounts and sends a receipt to the app.
In a video, Amazon says it uses “computer vision, deep learning algorithms and sensor fusion, much like you’d find in self-driving cars” to make the Go concept work. It calls the combination “Just Walk Out Technology.”
Amazon Go features ready-to-eat meals and snacks made fresh by on-site chefs and local suppliers, in addition to essentials such as bread and milk. Customers can also pick up Amazon Meal Kits with all the ingredients needed to make a meal for two in about half-an-hour.
Although new, Amazon Go raises many questions:
- How quickly will Amazon ramp up the concept and how many stores will it open?
- How long will it take rivals to catch up with Amazon Go’s tech?
- Will Go’s tech work in other retail formats?
- Will eliminating checkout labor drop to the bottom line or will labor be deployed elsewhere? If stores are able to eliminate cashiers, what will this mean for the larger labor picture nationwide?
- Will the consumer insights Amazon draws from Go affect its off- and online efforts in food and other categories?
- How will Go’s emphasis on fresh foods and local suppliers affect the relationship between the company and large CPG brands?
- Introducing Amazon Go and the world’s most advanced shopping technology – YouTube
- Amazon Go – Amazon.com
- Amazon unveils smart convenience store sans checkouts, cashiers – The Seattle Times (tiered sub.)
- Will Amazon give new meaning to convenience stores? – RetailWire
- Will Amazon drive-up grocery stores disrupt food retailing? – RetailWire
DISCUSSION QUESTIONS: What do you think are the most interesting questions raised by the launch of Amazon Go for Amazon.com and its competition? What do you think are the answers to those questions?