Amazon has opened the doors of their first cashierless store to the public this year, and coming year Amazon already has plans to open as many as 3,000 Amazon Go locations which are all set to revolutionize the way we do our shopping. However, Amazon has bigger plans than just opening a convenience store on every corner of our roads. The tech giant is already testing its “Just Walk Out” technology in bigger format stores, according to reports. If Amazon can with success adapt the technology to suit larger stores with more great higher ceilings, square footage, and more foot traffic, it could apply it in its Whole Foods locations.
Beyond that, Amazon is also anticipated to license the technology to compete, retailers, offering a source of high-margin revenue. However, Amazon has a lot of challenges to overcome to spread Amazon Go’s technology to bigger store formats. It is pertinent to mention that Amazon notably ran into trouble in the year 2017, holding the launch of its flagship Go location, owing to the system not able to handle the high magnitude of traffic. One can also say that tracking a customer around a larger store can be more difficult. It is not just about making the present system bigger or the ceilings higher. There is more space for customers to move around and there are frequently more customers in the store at any given time.
Another issue is that some shoppers may not want a cashierless experience. Because owing to experts, everyone wants to scan an app to get groceries however some customers may wish to pay in cash, while others might not like the idea of Amazon following everything they buy. Adapting cashier-less technology to larger-format stores with broader appeal than a convenience store may alienate some customers if there is no other payment option.
On the flips side, the more store formats Amazon can support with its “Just Walk Out” technology, the more skillfulness it gives the firm when it comes to making its store concepts or licensing the technology to other retailers. But the small format might be enough to capture the most potential clients. Larger stores like Walmart are not going to license technology from Amazon. Walmart is already testing its idea of a cashierless store, where customers merely scan products with an app as they shop. It is not nearly as elegant as Amazon’s solution but is termed a lot cheaper to implement.
The technology in Amazon Go can help those businesses decrease operating expenses and maximize the value of their floor space since they would not need to hire much workforce. The cost structure and shopping experience could assist medium-sized merchants to compete with the big-box stores. Amazon already is working closely with third-party merchants with its online marketplace and advertising products. It is not a big step to get similar types of brick-and-mortar merchants to sign on with Amazon for their mutual benefit. Amazon may even be consenting to license the technology for free in return for an exclusive cloud computing contract essential to run everything.
