Amazon Go may be stealing the spotlight, but it is far from alone in the rush to revolutionize in-store checkout through the use of sensors, scanners, mobile devices and more.
The ultimate goal of these projects is to reduce lines and increase foot traffic, but they rely on a solid foundation of digital payments technology. All of these systems have, in their DNA, a desire to move consumers to a digital payment option and away from cash and checks.
It’s no accident that most of these projects often occur in a grocery store setting. That industry is notorious for long lines, aggravated by carts full of groceries that take a long time to unload, ring up, and bag — a process made even longer if the shopper pulls out a checkbook at the end.
This item is compiled from reporting by PaymentsSource writers including John Adams, Kate Fitzgerald, David Heun and Michael Moeser. Click the links in each item to read more.
Amazon Go’s rapid expansion
Following the January debut of the first Amazon Go store in Seattle, the e-tailer planned several more stores to follow in locations such as Chicago, San Francisco, Los Angeles. Its second Go store opened in Seattle at the end of August.
It’s a surprising show of confidence from Amazon, which only opened the doors to its first Seattle store after internal employee tests reportedly challenged the premise that the store’s cameras and mobile technology could keep up with the crowds. And when Amazon Go finally did open to the public, early news coverage depicted the line-busting store simply moved its lines outside, as eager Amazon shoppers flocked to the store but had to wait their turn to step inside.
More shoppers may soon get the opportunity to try Amazon’s new model, and it’s clear that the timing will be key if Amazon is to demonstrate that its cashierless store concept is more than a novelty. It may seem fast for Amazon to already be picking out new locations, but Amazon has to move fast to fight off a growing wave of copycats and skeptics.
That said, even if the Go concept is a hit among Amazon employees and Seattle’s tech-savvy shoppers, that doesn’t mean it could succeed anywhere else. Mobile and digital payments tend to have trouble building a mainstream market, instead finding only pockets of success such as commuters and Starbucks patrons.
Shoppers entering the store scan a mobile app at a glass-gate turnstile, much like entering a subway. Cameras and other sensors detect which items shoppers pick up and carry out of the store, after which the purchase gets charged to whatever payment method the shopper has on file with Amazon.
Microsoft, Walmart test the limits of the Go concept
Microsoft is the latest to try to help a big retailer jettison cashiers — and the latest to discover how hard that is.
In June, it emerged that the software giant was working with Walmart on a rival to Amazon Go, the e-commerce giant’s checkout-free concept store. At first glance, this would seem to be a formidable challenge to Amazon, given Walmart’s huge footprint when compared to Whole Foods, the biggest physical property Amazon owns.
Amazon competes with Microsoft on cloud delivered technology and is in a fierce e-commerce arms race with Walmart. If Microsoft and Walmart team up on a concept that Amazon is heavily invested in, they could put a major dent in Amazon’s encroachment into traditional retail. Such a move would also give Walmart the same ability as Amazon to pair e-commerce and in-store shopping.
But there are problems for all of the players involved. The complexity of outfitting a full-sized store with digital sensors — the foundation of Amazon’s process for automatically detecting which products a shopper intends to buy — means it will likely be a long time before cashiers disappear from either Walmart or Whole Foods.
Microsoft is reportedly using a crew of about a dozen developers to build its cashierless payment technology, and is reportedly considering attaching cameras to shopping carts instead of Amazon’s approach of attaching them to the ceiling. That would be less costly and easier to mass deploy, but would still need to be proven in a real-world setting.