Amazon’s convenience stores rely heavily on location technology to track consumers’ movements inside buildings. Cameras analyze shopping behaviors, strategically placed microphones listen to conversations, and information about consumers’ shopping habits is stored in a central database that Amazon can reference for future operational and strategic planning.
“As cashierless stores take off, more and more personal and payment data will be transmitted through phones and mobiles devices and stored in cloud-based software platforms,” says Ruston Miles, chief strategy officer at Bluefin. “This means that hackers will have more network access to this data through vulnerable providers and merchants.”
Amazon has a knack for moving into new vertical segments and then applying its logistical mastery and economies of scale to carve out margins and undercut incumbents. Then, it doubles down by scaling things up to its signature high-volume/low-margin approach. As Jeff Bezos ruthlessly admits, “Your margin is my opportunity.”
The latest place for this to unfold is retail. No, we’re not talking about Whole Foods, though that’s part it (more on that in a bit). We’re talking about Amazon’s transformation of the in-store experience — upending and streamlining logistics just like it’s done in shipping and cloud computing.
Here are some predictions for how Amazon’s disruption of retail via licensing of its Go technology will upend the industry.
This time, it’s not Amazon Web Services, the cloud underpinning Amazon’s operations and those of other companies around the world, but Amazon’s Go technology that is being peddled to new clients. Bezos’ e-commerce behemoth is in talks to sell the flashy cashierless solution to movie theaters and airports, CNBC reported.
If Amazon is successful, the play to sell Go to other businesses may some day turn what now appears a revolutionary technical advance (with potentially devastating consequences for cashiers) into a commonplace asset. Just as AWS, the B2B play partially financing Amazon’s low-margin retail biz, supports thousands of businesses unbeknownst to their customers, Go-as-a-service could come to change all of retail without many consumers even realizing Amazon is behind changing checkout norms.
On this week’s Location-Based Marketing Association podcast: Goodwill, Bose + Coachella, Improving traffic with “Flo,” Amazon Go takes cash, Macy’s launches “Story,” Uber goes B2B with vouchers.
If autonomous checkout systems ever go mainstream, it will be because retailers finally figured out how to effectively harness in-store cameras to determine where customers are and what items they’re holding in real-time. Reaching that goal has proven elusive to AI technology providers thus far, but a San Francisco-based startup called Standard Cognition is hoping that its recent acquisition of Explorer.ai, a mapping and computer vision firm, will be the catalyst that’s necessary to accelerate growth and expand into new retail verticals.
Mike Boland: The innovation including and surrounding cashierless checkout goes beyond payments to affect a broader set of functions like supply chain, inventory management, and store layouts. It’s like a retail toolkit in a box, with cash-flow friendly pricing, à la SaaS. You may have heard of it: It’s called retail as a service (RaaS), and it could transform the next decade of retail. Amazon will lead the way.
Standard Cognition offers a product called Standard Checkout that retrofits cashier-based grocery stores into cashierless systems. Unlike the new cashierless Amazon Go, Standard Cognition is not a grocery chain itself, but instead a solution for chains that compete with Amazon Go, co-founder and COO Michael Suswal told Street Fight.
This Week in Location Based Marketing is a weekly video podcast from the Location Based Marketing Association with Asif Khan, Rob Woodbridge & Aubriana Lopez. On the show: Kroger, Yext + Duda, eyeQ launches Atom Research: Gasbuddy.
Online retailers like Warby Parker and Bonobos have been experimenting for years with pop-up stores and actual brick-and-mortar locations. This phenomenon was the subject of a recent study conducted by ChargeItSpot, which provides cell phone charging stations for retailers and events.
This Week in Location Based Marketing is a weekly video podcast from the Location Based Marketing Association with Asif Khan and Aubriana Lopez. On the show: Ashley Furniture, Google’s Winter Wonderland, Gimbal / Mobile Majority, Mall of America, and Shelfbucks.
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