Amazon Plans To Open Physical Store
December 8, 2016
Amazon.com has announced its plan to open a physical store, called Amazon Go, in Seattle. For about a year now, rumors have been circulating about a physical store for Amazon. Some said that the store would be like a Barnes and Noble, but for Amazon exclusive books and its Kindl products. Others reported that it would be a place to buy products Amazon offered online in the real world. Now, though, the plan is to make this store into a grocery store instead of a place to buy Amazon products.
Amazon also wants to make it possible for customers to shop without having to wait in a checkout line. To achieve this, customers would download the Amazon Go app and swipe their phone as they enter the store. They can then turn off their phone and start shopping. Whatever a customer picks up off the shelf is automatically added to the bill on their phone. If the product is put back on the shelf, the item is deleted from the phone. Amazon has not described the process that will be used to track products and identify the shopper except to say that it will involve computer vision, machine learning, and artificial intelligence. As the shopper leaves the store, the bill is calculated, a digital receipt appears on their phone, and their Amazon account is charged. To see how Amazon would like the store to work, check out the video link at the bottom of this article.
The opening of an Amazon grocery store poses many questions for the retail industry. The store will require less workers than the typical grocery store, as they have eliminated the need for cashiers and clerks. If consumers respond positively to this new technology, it might encourage other stores to follow suit and remove cashiers and clerks to try and save labor costs. Also, the set-up of the store seems to target drugstores and convenience stores, trying to advertise more for quick trips where shoppers only need to buy a few things. If successful, Amazon Go could present some serious competition for stores such as CVS or 7-Eleven. As seen in their promotional video (see link at the bottom), Amazon Go is attempting to have an ambiance and selection similar to that of Whole Foods or Wegmans. Amazon also plans on having prepared foods available made by on-site chefs. Prepackaged meal kits with ingredients to make a home-cooked dinner will also be available.
There are many problems that Amazon will have to work out for this idea to become successful, such as protecting against bugs and viruses. For now, Amazon is starting out slow, with just one Beta store open only to its employees. The store will be open to the public in early 2017.