So How is Amazon Go…er…Going?

Amazon Go storeUnless you live under a rock, you most likely have heard about Amazon Go, the experimental grocery store that uses technology to allow shoppers to bypass the checkout counter and simply walk out the door with their purchases. Within minutes of leaving, they receive an email of the items they left with, and the receipt with the charges to a card of their (previously registered) choice. The idea is to eliminate a signficant pain point – standing in line for the sometimes time-consuming checkout process.

But what do consumers think about the idea? You might be surprised…



I know this is not my typical beat, but when you follow technology…and Amazon…it is inevitable that some new technology story outside of AV will catch your eye. Like many people, I and my wife spend far too much time grocery shopping…every week. So if there is a way to reduce the pain of this seemingly unproductive time…I am interested. And if that new way involves new technology…so much the better.

Amazon has been quietly testing the concept for almost a year now. We’ve learned a few things about that. First, it isn’t really a full grocery store…more like a Mini-Mart convenience store with about 1800 sq.ft. – at least for this pilot project. Second, there have been many rumors of glitches to the technology and the company has been continually refining it. It seems that many shopping situations confused the technology, such as multiple shoppers on one account, as well as others.

Shoplifters Heaven?

The concern that most in the industry expressed when first learning of the concept is that the Amazon Go store will become the store of preference for shoplifters. According to a recent report in RetailDive, this has not turned out to be the case. Why? Well, mainly because Amazon has stocked the store with lots of employees to discourage this. Although adding all of these employees must offset some of the cost advantages of the checkout free concept.

There is one Amazon Go store in existence in the company’s home turf of Seattle, and it has recently been opened to the public. According to Amazon, all the kinks are worked out and it is now ready for someconsumer Beta testing.



According to RetailDive, a retail industry newsletter, recently, IHL Group Vice President of Technology Jerry Sheldon shopped the location and was impressed. “It’s absolutely fascinating – it really operated smoothly,” he told them in an interview. “There were no glitches. The system functioned flawlessly, with no limitations placed upon any items I selected.”

But Wait…Did Anybody Ask Consumers if They Want This?

Sounds good, but then we ran across some research that suggests that consumers remain skeptical. Check out the chart below:

Amazon Go chart

In a study by YouGov, consumers were shown four statements about Amazon Go, to which they were asked to either agree or disagree. The first two results are good news for Amazon, as consumers suggested that they would at least try Amazon Go – and they believe that Amazon will charge consumers the correct amount.



But the second two results are potentially troubling for Amazon. When asked how they feel about the statement “Amazon Go will solve more problems for shoppers than it introduces,” 22% agreed…but fully 40% disagreed, suggesting they anticipate more, newer problems.

Consumers: I Won’t Pay for the Convenience

And finally, when shown the statement, “I would be willing to pay more if it means avoiding checkout lines – fully two-thirds (66%) disagreed with that statement. Only 14% of consumers, a little over one in ten, agreed.

So shoppers will try Amazon Go, but they do not want to pay more for the convenience. Be forewarned Amazon…


About Ted

A sales and marketing specialist - primarily in the technology industry - I've experienced a sort of "circle of life" in business. I've been a mass merchant retailer, a specialty retailer, a specialty manufacturer, a large volume manufacturer, a distributor, and even represented sales representatives. Now the owner of a marketing company that works with a variety of businesses on improving their strategic marketing and business development - I analyze issues from all angles to develop holistic solutions.

Comments

So How is Amazon Go…er…Going? — 1 Comment

  1. I understand the “not paying for convenience” part. Why should I? I can call my local grocery chan or order online my full shopping list and have it delivered for a minor delivery fee. I can even pick it up when it’s ready if I don’t want to pay the fee. IMHO not everything Amazon comes up with is necessarily a good idea. I think people jump into too much of this “next BIG thing” only to have regrets or bail out on it later.

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