Big question: with the Amazon Go pioneering technology, is the Dark side winning?

The Amazon Go Store Experience

A review, from the customer perspective

Disclaimer: please note this report is a collection of personal thoughts, data points and a few quotes from experts. All info is publicly available. The content hereby written does not reflect in anyway the position of the company I work for.

Dear reader,

I had the pleasure to visit the very first Amazon Go Store recently and have decided to write a review about this experience, from a pure customer perspective. Without further ado, find it below. I hope you enjoy it.


SUMMARY

[in case you don’t have time to lose]

Amazon Go is the first automated grocery store that promises no lines, no checkouts, no registers. What it promises, it delivers, and it goes even beyond expectations. If that’s the future of grocery stores, once tried, I think anyone would be happy to embrace it open arms. Both the online and offline experiences are great, seamless, frictionless, lean. It is like when you experience first or business class in flight for the first time. After that, you don’t want to look back. The implications of such technology are huge: in a no distant future we might see more shops leveraging this incredible and silent technology. Meanwhile, governments will need to work hard to make sure all jobs lost gets compensated somehow. Amazon promises employees employed will be dealing with different tasks, more towards adding value rather than operational. But nothing is certain, except death -_-

We could see the advent of this pioneering technology with positive lens and more negative lenses. You choose which one you think is closer to reality:

  • NEGATIVE. This might be just a trojan horse, a future where automation, advanced technology and robotics will replace humans, with us not even realizing how much the world has changed
  • POSITIVE. A future where automation, advanced technology and robotics will coexist with humans, who will then focus on creating more value and delivering more exciting experiences to the customers of the XXI century

Update [May 19th 2018]

The robot revolution is really coming. Have a look at this deep dive by The Wall Street Journal into the world of industrial robots, looking at how they’re changing manufacturing and affecting low-skilled workers.

The Robot Revolution: The New Age of Manufacturing — Moving Upstream

INTRODUCTION

Amazon Go opened doors on Monday Jan. 22nd 2018, after nearly one year’s delay. The next generation of grocery stores can be found in one unique location in Seattle (2131 7th Ave, near the corner of 7th and Blanchard), close to the new Spheres, an incredible place where employees can think and work differently surrounded by plants[1]. What follows is a summary of the experience, from the customer/consumer perspective, with some interesting data points and personal thoughts and comments.


LOOK AND FEEL

The store does not look like the classic grocery store. From the outside, it seems more like a tech shop where you can buy fancy pots or geeky stuff. The truth is, there is a kitchen inside the store where all fresh food gets prepared, and all the pots and pans stocked on the glass wall makes you think you are entering a Geek-Techie Home Depot, rather than a proper “busy and dirty” grocery store with products packed in every possible available space.

So, from the outside, Amazon Go looks quite lean and clean, while inside the feeling is that you enter a space where everything is in order, and foods and beverages are shown in clear order in the classic retailer’s shelf style, although in limited quantities. Certainly, you don’t want to go there to do your weekly ‘big & bold’ grocery shopping. It is more the kind of place where you can grab-and-go quick meals and treats: from a meal kit for two ready to cook at night, to a sandwich to eat while on work break. Shelves are packed with products that can be found in other convenience stores but Amazon Go also hosts some brands usually found at Whole Foods, the supermarket chain that now Amazon owns, like catchy organic/vegan/super healthy snacks.


AUTOMATION & PERSONNEL

No, let’s clarify this straight away, it is not the end for people employed in grocery stores, yet. We did not reach the point where robots — instead of humans — are serving us and everything is fully automated. Despite the technology, almost invisible, and the seamless experience, the place is packed with many Amazon Go employees. In a 1,800-square foot mini-market, I counted at least five of them customer facing and a few more in the visible-from-the-outside-only kitchen. In fact, Amazon Go does hire people to work in the store — a team of “associates” who prep ingredients, make prepared items, greet customers and stock shelves.

As soon as you walk in the store, a bunch of employees are available to help you explaining what you need to do to take advantage of the full Amazon Go experience. Some say that the presence of associates is just for the initial phase.

Anyway, it is hard to think dozens of people will be needed in a store like this in the near future. In fact, you just need to download an app (the Amazon Go app) and scan the QR barcode as soon as you enter. That’s it. You are free to walk around, take anything, put back something if you change your mind and simply walk away. The added value of the associates working there could be helping customers with product recommendations and this is actually the way Amazon sees it, shifting from operational to more added value, experience creation tasks. In any case, unless they are planning to implement robots to make food in the kitchens — not an entirely remote possibility actually[2] — they still need their workers in both the kitchen and the store to prep ingredients, make ready-to-eat food, and stock shelves.


EXPERIENCE AND PRODUCT PORTFOLIO

As I said before, the impression is that you enter a space where everything is in order, clean and lean. Products are shown in the “classic shelf way”, but you get lots of stimuli as soon as you see cool packaging, vegan and healthy propositions, which invites you to keep filling your “free for a limited time” Amazon Go orange bag. It is so easy to overspend when you do not keep immediate digital track of the products and nobody is waiting for you at the checkout. It would be interesting to know how much more Amazon Go customers are filling their basket, compared to stores of similar sizes and with a similar selection.

In terms of offering, Amazon Go stocks delicious ready-to-eat breakfast, lunch, dinner, and snack options made by their chefs and favourite local kitchens and bakeries. The selection of grocery essentials ranges from staples like bread and milk to artisan cheeses and locally made chocolates[3].

I was curious to see what this phantomic technology was and I have to admit it was really hard to spot it. When you look up, you can see hundreds of what they seem to be modem routers, which all together create some sort of futuristic silent black ceiling. But the feeling is really that you live a frictionless experience.

Funny thing, when I entered the section where alcohol is stored, an employee politely asked me to step away. I asked why, and he told me I needed to show him an ID if I wanted to buy some alcoholic beverage. I replied that I only wanted to take a picture, but he insisted I could not even take a step closer, unless I showed him an ID. My health insurance badge was not enough. It is quite odd for Europeans to experience this rigour which might seem excessive, but pretty normal in the US because of the laws in place.

NOT AN EASY LIFE FOR A THIEF

Kyle Johnson, a writer for the New York Times, with permission from Amazon, tried to steal something. “He tried to trick the store’s camera system by wrapping a shopping bag around a $4.35 four-pack of vanilla soda while it was still on a shelf, tucking it under his arm and walking out of the store. Amazon charged him for it[4].


HOW TO

Amazon put a lot of effort in explaining in a very simple and clear way how the systems works. You can see it immediately even before you enter the shop. Some posters give you a hint of what to expect:

  • Download the app
  • Enter the shop and pick up what you like
  • Just walk out

It is so simple. Nothing really happens on the app when you pick up stuff and then maybe decide to put it back. Also nothing happens immediately after you leave the store. It is only after between five to ten minutes that you get notified about your order.

That’s it. All you need to know, and even more, is there: the list of items purchased, alongside with a simple explanation on how to get a refund of an item, the amount of money you save. I have been there twice and in both cases, everything worked just fine.


PRIVATE LABELS

A proprietary store is the perfect place to promote your own private labels. Amazon certainly did not want to miss this opportunity. As example, a full shelf is dedicated to the latest Amazon Meal kits. These kits are okay for a quick home-cooked dinner for two and can be prepared in about thirty minutes.

Prominent visibility is also given to private label snacks (chocolate) and gadgets.


THE FUTURE

The technology is finally ready and working properly. I understood there were issues in recognizing people when the store was packed, but this problem has been solved. This means soon we will probably see more stores popping up in US cities, most likely urban areas with high density, and in due time international expansion is a possibility.


Update [May 19th 2018]

The Verge recently reported here that Amazon Go’s cashier-less stores are coming to Chicago and San Francisco. No words on the opening’s dates yet though. The Seattle Times Amazon has posted job listings for store managers at those upcoming locations. A further confirmation on the US expansion plans.


Also, some thinks we might see Whole Foods stores (recently acquired by Amazon) implementing this technology, but according to the VP of Amazon Go Gianna Puerini, that’s not in the plan, for now.

As it happens with the AWS model (think Netflix, one of the main competitors of Prime Video, using Amazon cloud infrastructure), Amazon might think at some point to give other retailers the possibility to leverage this technology. Actually, possibilities are endless, nothing would stop them to move into other industries. For sure, the expansion of the Amazon’s grocery technology will have gigantic implications. “According to the Department of Labor, more than 3.5 million Americans held cashier jobs as of May 2016. Nearly 900,000 of those were in grocery stores. The Amazon Go store eliminates the need for cashiers, and could thus make thousands of jobs redundant”, says CNBC.[5] How governments will protect citizens from these future job losses, it is hard to predict.

Hi, I am your new Amazon Go employee. May I help you?

WHAT ARE COMPETITORS DOING?

Update [May 19th 2018]

The first interesting thing is what’s going on with Walmart in the US. Business Insider recently published an article that states the US giant killed Scan & Go, a service that let customers scan and pay for items without checkout lanes, cashiers, or registers. A couple of bullet points:

  • There was low participation” Walmart spokesman Ragan Dickens told Business Insider
  • The failed test highlights a key challenge for Walmart in its battle with Amazon: getting Walmart’s core customers to adopt new technologies and engage with the company digitally

In another article published by QUARTZ, we get to know that Amazon Go Stores aren’t the only experiment in this space. Actually, it seems that China is both ahead of and behind Amazon in cashier-less stores.

An example is given by BingoBox , “one of several venture-backed startups opening cashier-free convenience stores across China. At BingoBox, all items are labeled with an RFID tag. When checking out, users scan the items using a standard self-checkout machine and then pay using WeChat. The company is working on phasing out its RFID tag system, however, and moving toward image recognition for automatic purchases, similar to Amazon Go”.

According to the article, also JD, “one of the country’s largest e-commerce companies, announced a partnership to roll out hundreds of stores that combine facial recognition, QR codes, and RFID to eliminate checkout and boost data analytics”.

Then, “social media giant Tencent opened a pop-up store in partnership with EasyGo, another venture-backed startup focused on cashier-less stores, where customers could purchase WeChat-themed merchandise”.

And finally, “while e-commerce powerhouse Alibaba Group has yet to launch a genuine unmanned store, last summer its Taobao business launched Tao Cafe, a pop-up outlet that was cashier-less but still staffed with human baristas”.

Competition is fierce and what some people is experiencing is just the tip of the iceborg. Likely ten years from now, we will think how primitive our predecessors were. Queuing at the supermarket? Nonsense!


That’s it! What do you think about my point of view? I am looking forward to hear your opinions in the comment section below.


References:

[1] More at: https://www.seattlespheres.com/

[2] See: www.iflscience.com/ for more info on this topic

[3] Source: Amazon Go Official Website

[4] Reference: NY Times

[5] Reference: CNBC