Amazon Go ‘could send shockwaves’ through the industry

Amazon has revealed plans to open a retail store without checkouts.

The first store will open in Seattle, in the USA in early 2017, where customers will be able to pay for items they purchase using an app, which tracks when items are removed from or put back on shelves.

When a shopper enters the store, they scan in using the app and then pick up items and place them in their bag. When they are finished, they simply walk out of the store, when their account will be charged. A receipt will then be sent via the app.

Amazon has spent four years developing the shop.

When asked whether Amazon would roll this out to other countries and product sectors, they failed to comment.

Natalie Berg, an analyst at Planet Retail, commented: “Retailers have made a lot of progress on mobile payments as a standalone option. However, very few have been successful in moving towards a comprehensive mobile wallet and thereby addressing the problem of long queues. This is where Amazon comes in.”

Matthew Brown, director of Echochamber, a global retail trends intelligence company, said: “It’s by far the biggest news in retail this year. It is going to do away with one of the most annoying things in retail. It is one of the most fantastic, disruptive ideas in retail and it’s going to send shockwaves into the future. The applications are endless.

“The big question is going to be whether this is technology is only going to be available for the big boys. I have a feeling you’re going to get some very clever guys in San Francisco and Palo Alto that are going to develop apps that link RFID (Radio Frequency Identification) tags that even a small player can use. I think it’s an arms race that has just started.”

Mr Brown continued: “If it works as seamlessly as the videos are showing, it will be a game-changer. It fundamentally changes the relationship of product to people and service.

“It doesn’t matter what you sell, paying is a horrible process. No one likes doing it and no one likes queuing up at a checkout. That fact that Amazon has developed a grocery concept that gets rid of a checkout is just a sign of things to come.

“The whole tech sector, other than Apple, has sort of relied on this big box approach, of making you pick up a box and queue at a checkout to pay for it. And it’s increasingly become a useless business model. Apple revolutionised mobile payment five, six, seven years ago, where the browsing and the buying experience are essentially the same – the sales staff come to you, they bring the product to you out of the stock room and you pay wherever you are. So, it’s already in the market. The question is can you make it even more seamless than that? Yes you can, because Amazon is now saying that staff will just bring the box out to you and you just walk out. The whole process is seamless. There’s a clear customer benefit.”

Mr Brown concluded: “The depressing side of it will be some retailers will use the technology to automate stores even more and cut out staff costs. I think some retailers will choose to put staff into other areas where it adds value to the customer experience, such as advice, service.

“My future prediction of tech is that we could well start seeing augmented reality, like Pokemon Go, put into the process as well. It is yet another sign that the smartphone is going to be the ultimate interface between the customer and retail.”