More than any other company, Amazon pioneered online retail, totally revolutionizing how people shop and in the process, disrupting countless retailers that came before it.
But it isn’t done yet and one of its most audacious projects launches today in Seattle, Washington, the home of its headquarters.
Amazon Go, which Recode calls a high-tech version of a 7-Eleven, a large convenience store chain in the U.S., has been under development for five years and started with a simple question, “What can we do to improve on convenience?”
Amazon’s answer, in large part: get rid of checkout.
Thanks to a mobile app, cameras, sensors, computer vision and deep learning, shoppers at Amazon Go are able pick items off the shelf and leave the store without having to wait in line and pay. Instead, Amazon simply tracks what they’ve taken and automatically charges them accordingly.
Amazon refers to this as a Just Walk Out Shopping experience and calls the technology behind it “the most advanced shopping technology.”
Will it work?
The big question: will it work? From a technical perspective, Amazon had to overcome significant challenges to bring Amazon Go to market. Implementing a system by which an individual can pick items off the shelf, or put them back, and have a virtual cart that tracks what they’ve taken or returned, was obviously no easy feat.
And this gets even more complicated in a real-world environment. As Recode explained, Amazon is launching Amazon Go a year later than it had hoped to after a beta test open to Amazon employees encountered hiccups. A crowded store creates room for error. For example, if two people who look similar are shopping in proximity to each other, Amazon’s technology needs to be able to tell them apart. It also needs to deal with scenarios such as an item being taken off of one shelf and being returned to another shelf.
There’s every reason to believe that Amazon is capable of sorting out technical issues that might arise with its Just Walk Out Shopping experience but at the same time, it’s clear that Amazon isn’t infallible, especially when it comes to brick and mortar commerce.
Case in point: last week saw headlines suggesting that Whole Foods, the supermarket chain Amazon acquired for more than $13bn last year, has experienced problems under Amazon’s umbrella. According to those reports, some Whole Foods stores have seen “a crisis of food shortages” that have infuriated some customers. An inventory management system called order-to-shelf, or OTS for short, is said to be the culprit. Not surprisingly, some are questioning whether this is related to Amazon’s ownership and control of the company.
An uncertain future
As far as Amazon is willing to state publicly, Amazon Go isn’t the future of its brick-and-mortar operations. The company’s official position is that it has no plans to put Amazon Go’s technology to use in Whole Foods or its Amazon Books stores.
But that could obviously change if Amazon Go works and customers embrace it and for that reason, brick-and-mortar retailers, some of which are working on their own automation technologies, would be wise to pay close attention to Amazon Go. Some, like the New York Times’ Nick Wingfield, even suggest that Amazon might one day license the Amazon Go technology much the same way it licenses its cloud computing services through Amazon Web Services (AWS).
Of course, even if Amazon Go becomes the latest Amazon effort to disrupt the industry, it doesn’t mean that it’s the Future with a capital ‘f’. As the backlash against startups like Bodega, which wanted to replace the corner convenience store with a modern-looking vending machine, has demonstrated, many consumers still value a human-based customer experience and the relationships that can come with it.
This is particularly true in retail markets like luxury, so if and as experiences like Amazon Go become more common, there will almost certainly be an opportunity for retailers to differentiate themselves by going in the opposite direction.