Amazon Go and the Future of Stores

I'm excited for Amazon Go. I've talked about how retail needs to use technology to compete with other options (particularly online shopping) and Amazon may do just that. Automation of the check-out process will save Amazon on the salaries of employees on registers. Sure, the system will be gamed but the cost of operating with less employees will help them remain profitable (while working to strengthen the system over time).

One of the bigger profit gains will probably be the automation of the check-out process will reduce the friction of buying items. There won't be a chance to second-think a purchase at the register. It's similar to Amazon's one-click check out. Imagine going shopping with children just grabbing things they want and no register to stop those purchases!

Another major benefit from the store: Tracking. Tracking. Tracking.

The Amazon Go store will have the advantage of better customer data. There won't be any cash transactions so every transaction will be associated to a customer. The system is built from the ground up so there wouldn't be too many obstacles of supporting legacy systems.

This reminds me of Oceans Thirteen, where cameras/sensors were tracking everything that was going on in the casino including reactions and temperature of the customers. Amazon could do the same; there can be analysis of how customers react to certain products or where customers are looking. The possibilities are endless.

Since Amazon can track every movement in the store; the store can be configured to each individual. They can learn your preferences and change the lighting of a particular shelf to highlight a new item you may like. While the experience probably won't come close to being customized as the online experience, it can definitely be improved from the current stores. Imagine Amazon's Kiva system changing out shelves based on consumer data; they could relocate shelves based on factors like time.

Amazon can essentially earn revenue for advertising/featuring products. They could easily track the conversions as well.

While Amazon isn't the first to track customers using cameras/sensors in stores, I haven't seen or read about a solution that integrates technology into the shopping experience this deeply. It certainly helps to develop and own the store and the system.

Hopefully, this is a wake-up call for the current retailers. As Nike's founder, Phil Knight, said "Grow or die".