Amazon Go – is now the right time?

Door
Edgedatacenters - MK
-
0
582
Oracle enhances customer experience platform with a B2B refresh

Source is ComputerWeekly.com

Earlier in March, Amazon finally launched its first Amazon Go checkout-less store in the UK – a 2,500 ft2 convenience store in Ealing in West London, branded Amazon Fresh to coincide with its online grocery offering it currently has in place through an existing partnership with Morrisons.

Amazon opened the doors on its first Amazon Go store in Seattle in January 2018 after a year spent testing its Just Walk Out technology on its employees at its headquarters. The technology giant now has 27 stores in the US, while its Ealing store is its first foray overseas.

The store concept allows a customer to walk into an Amazon Go store by scanning a QR code from their Amazon app at a gate to allow entry, pick up a product, and walk out again without queuing to pay at a till point. The store claims to use computer vision technology – as opposed to radio-frequency identification (RFID) or weight sensors on shelves – to detect what a customer takes with them. Amazon then emails a receipt post-purchase.

“Amazon’s till-less store brings its track-record for frictionless online experiences in-store at a time where a positive customer experience trumps everything,” says Tiffany Carpenter, head of customer intelligence at SAS UK & Ireland, pointing out that Amazon’s power to disrupt has been proven time and time again.

But how clever is this technology, really? Miya Knights, retail expert and author, says “very”, adding: “People have tried to fool it and they just can’t. What store model and infrastructure enables the retailer to pick and choose who it lets in and is virtually fraud-proof in terms of what products it lets out?”

Knights points out that Amazon always chooses the UK as its first country outside of the US to test its technology because the UK is the most mature omnichannel market in the world.

“We have the highest proportion of sales going online than anywhere else in the world – around 40% of total retail sales is going to e-commerce, compared to around 22% in the US,” she says. “The UK is the most digitally savvy market because we love click-and-collect and we shop online a lot, I think UK customers are hungry for this technology.”

Knights points to the proliferation of self-checkout till points in UK grocery stores. “Isn’t it so twisted that the grocers have got us doing all that work at the self-service? An ‘unauthorised item in the bagging area’ alert is onerous compared to Amazon’s technology – we’re so ready for this,” she says, predicting that the UK may see another five to 10 Amazon stores in the next 18 months, with Notting Hill expected to be its second site.

Is it the right time to launch a brand new store concept?

Consumers may well be ready for the technology, but the timing of launching a brand new store concept in the middle of a Covid-19 lockdown – which means that non-essential stores have been forced to close for months on end, leading to a number of casualties of the high street, including Oasis and Topshop – took the UK press by surprise.

The Amazon Fresh store in Ealing sits on the site previously occupied by Monsoon – appropriately apt that a tech giant should swoop in and replace a struggling high-street fashion retailer which went into administration during the first lockdown.

But Andy Halliwell, retail strategy lead at Publicis Sapient, says Amazon has timed its entry to the UK high street well, saying it is the “right idea, right concept, right technology, right time”.

“If you look at the health of the high street in general, you’d probably think it wasn’t [good] with so many high-profile failures in the past six months. The UK high street will never be the same again, which is quite disturbing, but that does mean there’s a whole load of retail store estate which is currently underutilised and going very cheap.”

Halliwell says Amazon is an appealing “anchor brand” to have on a retail park or high street, which should attract other brands to a location due to greater footfall, likening the Amazon launch to the buzz and fanfare whenever Apple opens a new store.

The UK high street will never be the same again…but that does mean there’s a whole load of retail store estate which is currently underutilised and going very cheap
Andy Halliwell, Publicis Sapient

“In North America, there’s still a draw to see the Amazon Go store in Seattle of the Amazon 4-star store in NYC,” he says. “And now in the UK with the access to really cheap real estate, Amazon can negotiate hard with the owners on rent so it’s not going to be costing them much for a very small store.”

Halliwell also points to the explosion in supermarket sales in the past year – the retail winners of Covid have certainly been the grocery brands which have seen huge revenue increases online and in-store during the course of the pandemic.

Publicis Sapient’s consumer behaviour research also suggests that customers who have tried online grocery shopping in lockdown are likely to continue shopping in this way for their bulk food shops of ambient goods, alongside top-up shops at convenience stores and artisan local food shops.

“We’re going to see people lean harder into those types of behaviours when we come out of lockdown,” he says. “And convenience will be an even stronger part of the high street and this will become really true if Amazon scales up its presence over the next five years threatening smaller stores on the high street.

“So a high-profile brand opening a small format convenience store in a really cheap place just makes sense,” he adds.

The hygiene factor

Cheap rents from distressed assets and an opportune market aside, Halliwell says the consumer focus on hygiene caused by the pandemic also means its Just Walk Out technology is perfectly timed.

“There are concerns around proximity, talking to cashiers, as well as using money and self-checkouts. Everyone is focusing on touchless technology at the moment to counter these issues,” he adds.

The beauty of having a gated store means that Amazon is already able to control the flow of people and pause entry if the store reaches capacity.

“Additionally, because you have to enter using your Amazon account, it knows explicitly who is there. Remember when pubs had to log you in and register your details in case of a Covid outbreak? Well, Amazon automates all that stuff for you,” says Halliwell.

“It knows what you’ve purchased and when you’ve checked out. There are so many different uses for that data that they’re only just managing to exploit.”

But should we be concerned that a tech-driven store with minimal humans is launching at a time when thousands of retail employees are finding themselves out of jobs up and down the country?

“Personally, this makes me deeply uncomfortable,” admits Halliwell. “If we see grocery moving towards highly automated and a faceless retail model, then we’re going to see unemployment jump again – but who owns that problem? Amazon doesn’t, so what is the government or retail industry in general need for these people to retrain and find new roles?”

Halliwell says there will be a real challenge as there is an urgent need for investment into retraining as business more widely moves towards further automation.

“We’re already facing a challenge in society in general with the wealth gap – something like this is just going to further broaden that gap.”

Source is ComputerWeekly.com

Vorig artikel‘A Midsummer Night’s Dream,’ Sprinkled With High-Tech Fairy Dust
Volgend artikelInterview: Uber driver Yaseen Aslam on his Supreme Court battle and what’s next for gig workers

GERELATEERDE ARTIKELENMEER VAN DEZE AUTEUR