Shortly after its launch, Retail Technology Insider reported on the highly anticipated unveiling of the Amazon Go store in Seattle. We talked about the implications that arose from the opening and how the retail industry reacted all across the board – most responses were rooted in excitement.
When asked about the store’s launch, Pitney Bowes VP Doug Harrell stated, “Amazon Go is indicative of not only the constant on-the-go expectations today’s shoppers have, but the real value that customer data can produce. Truly tailored, streamlined shopping experiences are the path for forward-thinking retailers.”
Customer expectations have continually become more sophisticated in our increasingly mobilized world and how shoppers interact with retailers has drastically evolved. Harrell added, “Because the retail industry has long been ripe for disruption, it’s no surprise that offerings like Amazon Go are turning heads. Shopping in one, fluid motion is ultimately what retailers have been building towards as they strive to align the brick-and-mortar and online shopping experiences.”
To no one’s surprise, Amazon’s retail footprint continues to expand with the opening of their newest brick-and-mortar book store in the D.C. area (in an old Barnes & Noble location, no less). And, you guessed it, the experience is very…Amazonian.
According to WJLA, “Without price tags, customers can must scan an item at computers located throughout the store to find price information. Or they can use their Amazon app to take a photo of the front cover of a book which then pulls up the pricing, description and customer reviews.”
Customers aren’t the only ones benefiting from this retail revolution. Between being able to more effectively and easily gather customer data and the projected minimization of shrink in a store that utilizes an approach like Amazon Go, profit margins could, in theory, notably increase for retailers.
But now that the Amazon Go store has been around for a bit, retailers and shoppers are starting to shape more of an educated, holistic opinion about the launch. While, of course, many exciting factors indicate noteworthy and (more importantly) necessary innovation in the mildly dated grocery sector, the reality of applying that innovation at such a large scale could prove ultimately unlikely.
That level of technology doesn’t seem scalable for massive retail operations like Kroger and Walmart, who are continually upping their customer experience game. Forget about boutique, family-owned shops.
“While the technology is undeniably forward-thinking, grocery stores that operate like Amazon Go have a long way to go before they become ubiquitous,” said Harrell. “The infrastructure alone presents massive financial hurdles for even the largest retailers, let alone Mom and Pop shops.”
But newbies in the retail space are already three steps ahead of us. We’re seeing new competitors emerge that appear to be going toe-to-toe directly with Amazon Go and addressing those very concerns. Santa Clara-based AiFi builds on the cashier-less trend with their own emergence from stealth just a few weeks ago.
According to a TechCrunch article by Sarah Perez, “Unlike Amazon Go, AiFi claims its A.I., sensor and camera network-based system can scale from a small mom-and-pop all the way up to a big retailer with tens of thousands of square feet and a hundred thousand products.” That could be a game-changer in terms of profitability for retailers of any size.
With all that said, are cashiers even the problem in this equation that has customers clamoring for innovation? In a recent article, Total Retail’s Mark Ryski points to a different issue from which shoppers’ frustrations stem: a lack of cashiers.
“The checkout problem so many retailers seem to have is largely self-inflicted,” he explains. “Retailers, it seems, are genetically conditioned to cut expenses, and as every retailer knows, store labor (including cashiers) is the largest expense… Part of the problem is that many retail executives today believe that they can algorithm their way to success.”
The Amazon Go saga continues to unfold, and the RTI team will be here, eagerly watching with popcorn in hand.