The online giant has revealed its advanced concept for a store utilizing “Just Walk Out” technology. Newslook
SAN FRANCISCO — In Amazon Go’s world, shoppers walk into a supermarket, grab an item, and walk out. No scanning. No card swiping.
Sounds fantastic. But will it work?
Retailers and tech companies have long tried to fix what we hate most about grocery shopping — time wasted in long lines, tedious barcode scanning and waiting around for receipts. They’ve tried everything from self-checkouts to home delivery, to mobile pay and even fridges that order for you.
For all the hope and fanfare these solutions heralded, grocery shopping has yet to hit the express lane.
Some fixes have worked (kind of) and some have been massive fails. Here’s a list of the six that have been part of the grocery checkout mix for the past decade or so.
Self-checkout
This was supposed to be the killer application that made grocery shopping easy. Sadly, it didn’t quite happen that way. Too often shoppers ran into problems scanning or otherwise getting the systems to work. While the lanes still remain in many stores, others are beginning to pull them out. The parent company of Albertsons, Vons and Pavilions said last month it is taking self-checkout lanes from 96 stores of 352 it has in southern California, according to the Orange County Register. As of 2016, 41% of shoppers in North America have used them, according to Nielsen.
Delivery rebound
Once upon a time, all grocery stores delivered. You called down in the morning, put in your order and later that afternoon the delivery boy would come by with food to make dinner. The rise of supermarkets and car ownership ended that for the most part. But the concept has come back several times, though not always successfully.
In the dot-com bubble of the late 1990s, Webvan was the poster child for online grocery delivery. It offered grocery delivery in ten U.S. markets, launching in 1996 and going bankrupt in 2001 after losing millions of dollars. Other dot-com grocery delivery businesses that launched at the time included Peapod, HomeGrocer.com and Kozmo.com. Only Peapod remains, though much diminished from its heyday.
Delivery of groceries ordered online began to gather steam again a few years later. Large supermarket chains such as Safeway and Vons began offering online shopping with delivery. Companies like Fresh Direct, InstaCart and Amazon Fresh, as well variants tied to local stores, began to offer the convenience of ordering online and having the items delivered within a given window of time.
While the services offer ease and convenience, they also come with drawbacks, which could account for the fact that just 2.4% of total U.S. grocery sales in 2015 were online, according to Internet Retailer.
Finding a window to have the items delivered is often difficult in today’s over-scheduled world. Orders don’t always come exactly as they were placed. Sometimes items are unavailable, but online ordering makes the kind of on-the-fly substitution possible standing in the grocery aisle impossible. Finally, U.S. consumers remain somewhat leery of having someone else pick out their fruit, vegetables and meat.
Self-scanning
In Europe, Diebold Nixdorf, which makes cash registers, has launched a TPiSHOP app. This allows shoppers to avoid checkout lines by scanning each item they want to buy with their phone or with a hand-held scanner they carry with them as they walk through a store. The system is currently only is available in Europe, said Dave Kuchenski, director of design and new technology incubation, but the company hopes to introduce it into the United States.
But it’s not something all shopper readily embrace, said Stu Lipoff, a fellow with the Institute of Electrical and Electronics Engineers and a partner with the consulting firm IP Action Partners.
“There’s something really artificial and uncomfortable of picking up a scanner and carrying it around when you’re in a store,” he said.
Dash away
In an effort to make ordering groceries online effortless, Amazon in 2015 launched the Dash button. These small lozenge-shaped devices have their own WiFi and come branded with different grocery items such as Tide detergent or Huggies diapers. Customers stick them to their washing machine or inside a cupboard, then click the button to reorder when they notice they’re running low on something. The Dash is synced to a user’s Amazon account. The buttons are now available preset for more than 100 items. However it’s unclear how whether consumers are really embracing the idea. Slice Intelligence said in March that only half the people who’ve bought one have actually used it.
Smart appliances
Smart appliances are the coming trend, but the actual follow-through is still being worked out.
Samsung has focused heavily on this, with a line of refrigerators with built-in touch-screens that can keep track of food in the fridge and provide recipes that match the inventory. The Family Hub refrigerator, announced at CES in 2016, comes with a smart screen that is pre-loaded with a MasterCard grocery purchase and delivery app. It integrated with grocery partners FreshDirect, ShopRite and MyWebGrocer. The refrigerator also works with Amazon’s Alexa voice-control platform, allowing consumers to speak their grocery list and have it automatically ordered.
An Internet-connected fridge is not the same thing as a smart phone. Customers who bought early Samsung smart refrigerators reported running into trouble when Google changed how its Calendar program, which appears on the Family Hub screen. There was no way for customers to upgrade their refrigerator to accommodate the new program upgrade, leaving them with a fridge with a useless screen.
Mobile payments
It’s been a few years since consumers have had the ability to turn the smartphones in their pockets or even the watches on their wrist into mobile wallets capable of paying for stuff at retail (and online), most notably through the likes of Apple Pay, Samsung Pay and Android Pay.
The regular use of mobile payments remains flat at 19%, according to a recent consumer survey by Accenture.
Significant hurdles remain across the entire mobile payments industry. Only relatively new smartphones are compatible with the various mobile payments methods, and some consumers are still concerned about security, though most mobile payment approaches are in fact more secure than handing a credit card to a clerk.
Dreaming of Drones
Aside from Star Trek-style replicators —which even Amazon hasn’t worked out yet — the Holy Grail of all online delivery right now is drones. Deutsche Bank estimates drones could deliver for half of what trains, planes or automobiles cost. But while Amazon’s got a full drone lab up and running outside of Cambridge, England, so far no one’s quite got the mechanics and the regulatory issues worked out.
Until then, the only one who can provide that kind of speedy, pin-point service is, you guessed it, Santa Claus.
