hou0057_blog_amazon_go_2017_01

2016 was quite a year for Amazon. First, they steal a march on major competitor Netflix by snatching up Top Gear, a show watched by an estimated 350 million people around the world. Then they successfully test their drone delivery service, Amazon Prime Air, by incredibly delivering a TV streaming stick and bag of popcorn directly to a nearby customer. But their latest concept may well be their most ambitious yet and, if it comes to fruition, will certainly have the biggest ramifications for the retail industry. But just what is Amazon Go?

As consumers we’d all like to be able to just walk in to a store, pick up whatever we want and walk out the door with it. Amazon have spent the last four years actually making it a reality. Amazon Go essentially eliminates one of the necessary evils of shopping – queuing. As their demonstration video shows, their 1,800 square foot, beta-testing grocery store in Washington has no lines because there are also no checkouts. They claim to have blended “deep-learning algorithms” and “sensor fusion” to create what they are calling “Just Walk Out Technology”. All you have to do is simply scan a QR using your phone as you enter the store and everything you pick up and take will automatically be added to your mobile wallet, which will then be automatically debited of the amount. All that’s left to do is leave the store and enjoy your purchases.

Amazon Go is a brilliant example of blending emerging technologies such as mobile payments, computer vision and senor fusion, and using them to tackle problems such as the modern human behaviours of impatience, convenience and the fact that we’re all pretty attached to our phones, literally. Of course, there is a massive downside to this and one that is already raising questions in the United States – what about all the retail sector staff that currently do the work of these ‘robots’? There are about 5 million such staff in the US (and approximately 1.3 million here in Australia). If they’re not needed anymore, that is going to cause a lot more problems than it is going to solve (having to queue for 5 minutes).

Is Amazon Go something that needs to immediately be stopped or is this just the next logical development from the automated checkouts already in use in most supermarkets or the self-serve kiosks like those rolled out by McDonald’s? Just look at what Hailo and Uber have done to the taxi industry. Sure there were people – most noticeably the taxi drivers – who resisted it at first but I think we’d all agree the convenience-led change has been worth it. Of course that’s easy to say, as very few taxi drivers lost their jobs, most just adapted to the technology and kept going.

Unfortunately, big brands like Amazon have the strength and the financial clout to make what originally seem like crazy ideas a reality. While I’m not sure if flying drones will completely replace your local postie, I have to say that I can’t help but feel that Amazon Go is a watershed moment for the retail industry. While it might be a double-edged sword and is certainly one that needs a lot more debate and investigation before it becomes mainstream, it is one that will certainly make the various cartels that dominate certain retail sectors in Australia (Coles/Woolworths, David Jones/Myer) sit up and take notice. You never know, they might all be using this technology in the next 10 to 15 years and you’ll remember where you first read about it… right?