Is Amazon Go a model for retail of the future?
Amazon Go opens its doors to the public, but are consumers ready? (Amazon)
Amazon Go opened its doors to the public last week and as promised, there were no cashiers or registers. Instead, items are automatically added to the shoppers’ virtual baskets using technology and hundreds of overhead cameras. But perhaps this model is not meant for all physical stores—not yet at least.
So how will this next step in retail technology affect the traditional store?
Brent Franson, CEO of Euclid, a leading data platform for offline attribution and store visit retargeting, calls the innovation an “incredible feat.”
“Amazon gets all the credit for developing a store run nearly entirely by technology,” Franson told FierceRetail. “But once someone blows over the physical and technical hurdles of an impossible task, they’ve smashed the mental barriers holding everyone else back too. The impossible is now possible. “
Still, Franson notes the Amazon Go model will not work for all retailers. While consumers want shopping to be easier and faster, they still want to have a social connection.
“We do generally value human interaction, especially in the Nordstroms, Barnes and Nobles and Targets of the world,” Franson said. “This is why you see Apple, Best Buy and even Dollar General investing in people, not technology for technology’s sake. Retailers who remember the human side of the equation will ultimately be successful even in a postmobile, post-Amazon world.”
However, Franson notes an exception where a similar model might work well, and that’s in the area of convenience stores.
“If you’re running into a 7-Eleven to grab Advil or diapers, you’re not looking to linger and the retailer’s not overly focused on getting you to stick around. The value prop here is to get in/get out as efficiently as possible. The premium is on product availability and ease of checkout, not the availability of super-knowledgeable, helpful sales associates,” he said.
So while Amazon and perhaps some other forward-thinking retailers are ready to go cashless, are consumers on board as well?
“Much of the technology (multiple-view cameras, etc.) elicits a ‘creepy tech’ response, but if anyone can pull it off, Amazon can,” said Matt Sargent, senior VP of retail at Magid. “Amazon has been shown to be a good steward of personally identifiable info. Through numerous focus groups, we have heard time and time again how people trust Amazon.”
Plus, as Sargent points out, the demographic of consumers who will shop these stores are already several generations past using cash.
In addition, he believes that now is a great time in retail evolution for organizations to be testing out technology like Amazon Go to get a sense of how customers will react to new offerings.
