Commentary: Amazon Go — what it means for Amazon

On Monday, Amazon announced the launch of Amazon Go, a checkout-free convenience store in Seattle. The 1,800-sq.-ft. store is powered by what Amazon calls “just walkout technology,” which combines computer vision, sensor fusion and deep learning technologies. Currently open only to Amazon employees, Amazon Go expected to open to the public in 2017.



Here are excerpts from a report by Deborah Weinswig, managing director, Fung Global Retail & Technology, on Amazon’s new initiative, which, she said, has the “potential to revolutionize” the brick-and-mortar retail experience:



“While Amazon Go will likely not have an immediate impact on the market, we see the launch of the store as an industry catalyst that will likely stir up competition to deploy technology in brick-and-mortar spaces and ramp up ecommerce efforts even further.



Amazon Go, Amazon’s “checkout-free” convenience store, is the newest innovation from Amazon, and it has generated considerable interest since the news of the store’s launch was released. Described as running the “world’s most advanced shopping technology”, this innovative concept has the potential to revolutionize the brick-and-mortar retail experience, bridging the digital and physical worlds, and creating unprecedented convenience for the consumer.



If the “Just Walkout Technology” that is integrated in Amazon Go proves to be a success after its pilot run, it could have major implications for Amazon, such as the following:



• More consumer data will lead to better shopping recommendations: Amazon is known for its ability to gather and use data to offer an ever-improving customer experience. When shopping for convenience purchases and food, people inherently shop differently than when doing so online. This is why a brick-and-mortar convenience store is a new consumer touchpoint for Amazon, and one that is inherently different from online shopping. Having access to data from the store will likely enable Amazon to provide even better shopping recommendations to its shoppers.



• A feed into Amazon’s AWS business: The technology powering Amazon Go will likely become a commodity sooner rather than later, and Amazon can choose to offer it to other retailers as a complement to its Amazon Web Services (AWS), which include cloud-computing services, analytics and marketplace platforms.



• A play into health and wellness: As Amazon Go sells primarily meal-kits and ready-to-eat snacks, Amazon will in fact be collecting data on people’s food consumption and nutrition habits. We see this as an interesting opportunity to develop original products or integrate data with existing wearables that track fitness and health to offer a convenient 360 wellness-monitoring solution.



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