Amazon Go Brings Retail Experience into 21st Century
Brian Solis
Head of Global Innovation, ServiceNow | 8x Best-Selling Author | Keynote Speaker | Digital Futurist
Every industry is ripe for disruption. It's what you do now that defines your future and legacy.
One of the most exposed industries to disruption at the moment, among many, is the retail sector. From the internet of things (IoT) to sensors to beacons to displays to apps and everything in between, each new trend introduces new challenges and opportunities to compete.
Technology trends however, do not solely define the future of retail. People count for everything. How they shop today versus how they want to and will shop in the future is the source of meaningful innovation. Technology changes. People evolve. That's digital Darwinism at work. But there's more at play.
Mobile, social, and every popular app or device that become the next big thing constantly push people further and further toward new and exciting experiences. Digital payments too, such as PayPal, Square, Venmo, ApplePay, Google Wallet, et al., are conditioning consumers to rethink the relationship between physical cash and transactions. With that said, even transactions are open to new dimensions.
On-demand companies such as Postmates, Uber, and the like, are hiding payments and transactions and packing everything together as "an experience." Add everything together, and those paying close attention will see how outside forces are influencing new customer behaviors, preferences and expectations day in and day out.
Business as usual is no longer ok. Taking new tech and tying it down to old perspectives and processes is not innovation. It's iteration at best and dangerous in common practice. Retail and e-commerce not only face new pressures to innovate, but also must explore co-existence and even collaboration to re-imagine the meaning of "space." The reality is that competition can come from anywhere.
What's the difference between iteration and innovation?
Iteration is using new tech to do the same things better or differently.
Innovation is doing new things that create new opportunities and value.
Only one sets the stage for a new normal.
What's clear now is that customers do not want compromise. Yet, they're forced to compromise in many ways throughout the customer journey. Innovation in shopper experience is all the work you do to conform to expectations and aspirations of people as they evolve instead of making them conform to your legacy perspectives, assumptions, processes and metrics of success.
Physical retail space, operations, and everything behind the scenes are your opportunities to disrupt and at the same time, thwart disruption and competitive threats.
Amazon Sets The Bar for a New Level of Customer Experience...Again
Amazon made news when it opened a brick-and-mortar bookstore to challenge everyone's idea of what a bookstore could be in the 21st century. Now, Amazon opened a beta version of what a grocery store could be. Introducing Amazon Go. Opened only for employees in Washington at the moment, this 1800 square foot pilot demonstrates exactly how retailers need to rethink the future of retail beyond beacons, magic mirrors and apps.
What is retail?
That's a serious question.
We tend to base the answer on retail as we know it. It's a form of cognitive or validation bias if you will. When we consider new possibilities, they're centered on a common perspective of today's functional environment. We don't start from a new center and as such, we unintentionally wrestle with iteration vs innovation.
But not Amazon...
This is a company that often starts with a blank slate, customer-first perspectives, and different questions:
What if...?
Might we...?
Why...?
Amazon is yet again, demonstrating that the future of retail is left to imagination. It seems that more and more, the path to innovation is tied directly to the ability to appreciate, but also see past, iteration.
So, what is Amazon Go?
Let's start with what it isn't...a traditional retail store.
Amazon is beta testing a grocery store for the 21st century that reconsiders space and transactions in a world that blurs mobile, online and spatiality. It all takes place in a new 1,800 square foot space at 2131 7th Ave in Seattle.
It all starts with an app...Amazon Go. You "check in" via the app when you walk in the store. Using a combination of sensor (fusion), computer vision and deep learning, the smart shelves track what's removed and returned creating a virtual cart of sorts. When the shopper is finished, they...wait for it...just leave. There is no check stand, register, or clerk waiting to take your money. The app charges your account and sends you a receipt.
Brilliant.
In a statement, Amazon explained the inspiration for Amazon Go:
Four years ago we asked ourselves: what if we could create a shopping experience with no lines and no checkout? Could we push the boundaries of computer vision and machine learning to create a store where customers could simply take what they want and go?
Our answer to those questions is Amazon Go and Just Walk Out Shopping.
At the moment, the store is open to employees only. But it's just a matter of time until it, or something like it, opens to the public. Make no mistake, analysts and strategists everywhere are now forced to rethink the future of retail from a new perspective...starting with adapting customer experiences to connected consumerism. Retail now has a new normal.
It's smart brick-and-mortar retail fused with Amazon Prime built upon a new perspective for physical and virtual space all with the frictionless transaction model of Uber. All it takes to re-imagine the future of retail is to explore the experiences consumers love outside of the industry. Then and only then, can you balance iteration with innovation. As Steve Jobs once famously said, "Start with the customer experience and work backwards from there."
Brian Solis is the author of X: Where Business Meets Design. Follow him on Twitter and LinkedIn. Invite him to speak at your next event or meeting.
Crawl, Walk, Run, Fly: I help bring certainty to revenue and costs by aligning business funnels to customers' challenges by creating data-driven experiences that generate differentiation and value.
7yAround 16M people work in retail in US. According to BLS workers make $11/hr and earn $20-$25k/yr. 2.5 million are grocery. Everyone knows what happened to large parts of the US when Walmart came in & replaced local biz with low paying jobs. What happens when large # of 2.5 million in grocery start losing their jobs to concepts like Go. 54% of grocery store employees have only a high school education & are over the age of 35. What happens to 400,000 kids age 16-18 whose first real job is in grocery stores. This closes off another avenue for them to learn some basic job principles - and to earn money to pay for college. There's no doubt this is coming, but the real question is - how does society enable more efficiency without leaving people behind
Digital Area Leader @ AFC Chile | Digital transformation expert
7yLa eliminación de los cajeros, uso diferentes tecnologías de IOT, el siguiente paso del Retail.
Senior Associate, IT Project Portfolio Management
7yTheodore Burton I hear you guys have a beta type on at the Amazon headquarters in Seattle! Thoughts?
Business Development | Conscious Leadership | Transformational Mindset | Early-stage Entrepreneurship | Innovation | Social Impact | Internationalisation | Strategic Partnerships | Data Analytics | OmniChannel Commerce
7yinvisible payments for an "instant-shopping" experience. That's it!
Analytics, Thought Leader, Innovator & a start-up advisor and GenAI for High Tech
7yOn black Friday, as I was waiting in line at a store with one item that wanted (yes, that word fits better, than "needed") with the wait time ticking past 20 minutes, my mind wandered to think about WHY, with all the technological leaps we have made, none of it had made it into transforming POS from its fundamental form. Adding salt to the injury was the fact that despite the long lines, the employees were still focused on opening new line of credit at the point-of-sale and repeated the question 3 times (as they had been trained). It begged the question about where Customer experience was in terms of priority for these big-box stores. In retrospective, Sams club had (have? not been there in a few years now) hand-helds that appeared to help. Walmart has talked about using RFID tags to make a seamless exit out of a store that I hasn't seen the light of the day. Yet, in 2016, I had to wait in line in the maddening rush of black friday to get one item. Why wouldn't the POS counters be simply for exceptions (the 10-20% of customers that have rather complex situations with coupons that don't reduce the price per expectation et al which begs a different question... why bother... be clear with pricing!) while allowing significant number of customers to exit quickly. What if stores use their app to double up as the purchasing engine, for example? People would scan their items and pay for it inside the app. That doesn't not seem far fetched (technologically, everything is available). I would have to imagine that retail industry would love that because it seems to make the business run more efficiently, improve customer experience (re-train employees and have greater availability for customer queries which I believe has a direct impact on sales/profitability as Home Depot and Best Buy have shown) and most importantly, give very little time for customers to be objective about their purchase (see below)! Here is hoping that Amazon GO is just the start for the retail industry to wake up from their deep slumber (and it wouldn't be the first time Amazon did that to them!) and work specifically on improving customer experience. One good thing about the line was that I had time to figure out if I really needed the item and decided I didn't. It definitely wasn't worth the wait and walked out of the store empty-handed!