Study: Cashierless stores play a role, but how big?

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Study: Cashierless stores play a role, but how big?

By Dan Berthiaume - 04/23/2020
amazon Go

New analysis of the Amazon Go cashierless convenience/grocery store format suggests not every retailer may want to adopt it.

Two years after Amazon opened its first Amazon Go store in January 2018, a consumer-focused evaluation of what Amazon calls “Just Walk Out” shopping indicates its rollout may remain relatively niche. According to analysis from the User Experience Strategies Service (UXS) at Strategy Analytics, the Amazon Go format is exorbitantly expensive to implement and maintain. This makes it impractical for many other grocers or general merchandise stores, as well as other use cases with high inventory and checkout stations.

UXS analysis also indicates frictionless retail is unsuitable for many other retail verticals beyond grocery and convenience. For example, UXS says that consumer electronics retailers selling products such as smartphones and televisions are better suited for a concierge sales approach than an impersonal “shop-and-go” approach.

In addition, according to UXS, retailers that encourage trying-before-buying – such as clothing stores with fitting rooms or on-site alterations – are not well-suited for this concept, as shoppers are far less likely in practice to return a “retrieved-but-unpurchased” item to a shelf.

“While not directly relevant to other industries, if cashierless concepts such as Amazon Go become more widespread, we would expect to see continued growth in consumer adoption of forms on contactless payments, which Strategy Analytics already expects to happen due to the COVID-19 pandemic,” said Derek Viita, senior analyst, UXS.

Lisa Cooper, director, UXS, added that Amazon Go does demonstrate a value proposition for in-store camera and sensor solutions.

“At a macro level, Amazon Go is also proof that a complex system of cameras and sensors can successfully be deployed in large-scale settings with an impressive level of accuracy,” Cooper said. “This should bring confidence to developers of other complex camera and sensor systems, such as vehicle-to-vehicle and autonomous driving applications.”