Amazon Go, the company’s first revolutionary store without a cashier, opened on January 22, 2018. It’s been six months. So, how’s it going?
It must be successful overall as Amazon has announced the development of two more Go stores: one in Chicago, one in San Francisco.
Successful, yes, but being such a new and revolutionary concept, what have they learned? Last March in Las Vegas, Gianna Puerini, VP of Amazon Go, and Dilip Kumar, Amazon Go’s VP of technology, discussed challenges and lessons learned from the launch of the first store:
- The decision to use computer vision, not RFID, proved to be correct.
- Computer vision fostered machine learning, already in use at Amazon.
- RFID is too expensive due to the need to manually tag product.
- Design around the customer, not technology.
- Customers are initially uncomfortable “just walking out” of a store, not paying. It takes a couple of visits before they are used to the idea.
- Re-stocking is a big challenge due to the high product turnover.
- Cashier positions need to be turned into re-stocking positions.
- Amazon will not introduce the Just Walk Out technology at recently acquired Whole Foods.
- Their chicken sandwich has been the best seller.
Obviously, Amazon executives are not the only ones reporting on lessons learned. Here are some other observations from industry watchdogs:
- You must make it easy for the customer in a new, potentially confusing environment. Eliminating the 20% to 40% of the time usually spent in checkout lines in most stores helps.
- The warnings that customers would never allow their credit card information to remain on file with Amazon (so they can just walk out) proved to be false.
- Analyzing customer’s wants and needs in terms of product, and always having those products on the shelf has been a key to Amazon Go’s success.
- The Amazon Go app has been a key to Amazon Go’s success. The customer launches it in the store in order to shop. The technology then takes over, charging them for their purchases and sending a digital receipt. Obviously, all purchases are recorded and used in re-stocking models.
- Numerous people entering the store at once and not individually “checking in” on their apps has been a “customer training” issue for Amazon employees.
- There have been no reports of excessive shoplifting.
- “Big Brother” concerns still remain.
Yes, there are concerns and issues to solve, both from a customer and company perspective. As many have pointed out, the concept is not transferrable to all types of brick-and-mortar retail. But in Amazon’s first 1,800-foot convenience store in Seattle, the idea is basically working—and working well enough to serve as a launchpad for more Amazon Go stores. You’ve got to wonder what 7-11 is thinking.