Is Amazon Go's checkout-free store the future of retail, or just an expensive gimmick?
Amazon's hi-tech, cashier-free convenience store has just opened to the public and predictably resulted in torrents of "store of the future" headlines. Unveiled a year later than initially announced, and reportedly at least five years in the making, it is clear this is an impressive state-of-the-art, tech-heavy retail experience, but is it really the future of shopping? Or is it just a very expensive publicity stunt?
It was late in 2016 when Amazon revealed its upcoming experiment in bricks-and-mortar retail. Designed to eliminate the hassle of waiting in lines at the check-out, the store is basically a giant surveillance device that tracks everything you pick up off the shelf and charges you accordingly upon leaving the premises.
The store, called Amazon Go, was scheduled to open to the general public in early 2017 after extensive beta testing with Amazon employees. But by March it still hadn't opened and rumors began to swirl that the technology wasn't working well enough for a general public opening. Amazon suggested it wasn't technical difficulties delaying the opening but rather just expansive testing with a high number of internal employees.
After several months of radio silence, the new hi-tech retail experience located at the bottom floor of the company's Seattle headquarters has finally opened to the general public, and in the face of journalists trying to steal things or fool the technology, it all seemed to work pretty well.
The system is surprisingly straightforward, without the need for specific tags on items or blank branding. It begins with a customer adding the Amazon Go app to their smartphone. Launching the app, connected to an Amazon account with a valid credit card, a QR code appears. To get into the store a customer passes through a turnstile that is unlocked by flashing the unique QR on their phone.
From this point on a plethora of cameras begin tracking your every move. When you pick an item up off a shelf the system can identify you and the item, adding it to your virtual shopping cart and removing it from your cart if you return it to the shelf. When you walk out of the shop the system simply automatically charges you for whatever it assumes is in your bag, and from early reports it actually works pretty well.
We've seen checkout-free convenience stores before, but nothing as technologically advanced as this. What Amazon has created is undeniably impressive, but what the long-term plan is for this huge investment of development time and money is still unknown. Amazon owns the mega franchise Whole Foods but there has been no indication of plans to roll the concept out past this single experimental store. In fact Amazon's Vice President of Technology has gone as far as saying to Recode, "There are no plans to ... introduce this technology in any of the other physical settings that we have."
How well the system works over time and whether it still has bugs to be ironed out will become apparent over the coming months, but a big question hovering over the entire experiment is how much it costs. Outfitting an entire space with such a complex camera and computing rig would not be cheap. For comparison, a current four-lane self-service supermarket set up costs around US$125,000, and the Amazon Go infrastructure is exponentially more complicated.
Overall, the system doesn't exactly entirely eliminate staffing costs either. You need humans to restock shelves (although Amazon is reportedly developing robots for that very task), a help desk for returns and problems, and the Amazon store has even had to hire someone to stand next to the alcohol section and check identification. So this isn't exactly a human-free experience.
Amazon Go is undoubtedly an interesting experiment, but for now, and the near future, it is still significantly cheaper for humans to run these stores. The millions of people who work in similar roles in the United States need not worry. Amazon Go is more likely a fantastic display of technological innovation in 2018 than a demonstration of a store of the future.