Amazon (AMZN): The Evolution of Retail – No Lines or Checkouts

Amazon's latest store takes shopping convenience to a higher level

Amazon AMZN shopping

Online retail giant Amazon.com, Inc. (NASDAQ:AMZN) has just unveiled Amazon Go — a 1800 square-foot grocery store located at 2131 7th Avenue, right on the corner of Blanchard Street and 7th Avenue in Seattle, WA. What’s so special about the store? It’s Amazon’s first brick-and-mortar store without any checkout counter. You read it right. No checkout counters. Which means no time wasted in lining up to pay — the ultimate in shopping convenience.

How does shopping like this work? Simple. All Amazon customers have to do is visit the store; open the Amazon Go app on their smartphones (or iPhones); scan their phones as they go through the store entrance; pick up the items they want to buy; and leave the store once they’re done.

Amazon is calling it their ‘Just Walk Out Technology.’ You walk in, grab what you want, and walk out. The accompanying app will tally your purchases, charge your Amazon account, and send you a receipt.

In this video, an explanation about the technology is given.

Apparently, it uses computer vision — the same kind of technology that allows self-driving cars to see — for identity recognition. So once a customer has been recognized (after scanning the app), there’s no need to scan items individually. Then using sensor fusion and deep learning algorithms, whatever you pick up is automatically added to your virtual cart, and whatever you return to the shelf is automatically erased from your bill.

According to Amazon, they have been working on this concept for four years. Although the company continues to enjoy consistent revenues from its online business, they have been looking to branch out into other channels to grow their sales further. Since they started with virtual stores, the next logical step is physical stores. And late last year in November, they opened their first one — a bookstore in the University Village Mall in Seattle named Amazon Books.

Aside from selling books, the shop also promotes Amazon Prime by encouraging customers to sign up as members. Customers are likewise given the chance to try out Amazon devices like Kindle, meet Amazon’s voice assistant Alexa through Amazon Echo, and test drive their Fire Tablet and Fire TV. They’ve opened 2 more branches since then — one in San Diego, California and another in Portland, Oregon.

For Amazon Go, the main attraction will be its grocery items, and the fact that you can just ‘grab and go’ of course. It offers snacks; ready-to-eat breakfast, lunch and dinner meals; pantry essentials like bread, milk and cheese; locally made chocolates; a few well-known and well-loved brands; Amazon Meal Kits to prepare a home-cooked dinner; and some other ‘special finds’.

Right now, the store is in its testing phase and it’s only Amazon’s employees who are allowed to shop inside. Early next year, it will be everybody else’s turn. And Amazon will know whether the technology they invested in to make cashier-less shopping a reality is worth it.

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