
Customers take barcoded items off shelves, place them in the cart, wait for a beep, and then one of two things happens: Either the shopper gets an alert telling him to try again, or the shopper receives a green signal to confirm the item was added to the cart correctly. Rather than equipping stores with ceiling cameras and shelf sensors, Amazon is building smart carts that use a combination of computer vision and sensor fusion to identify items placed in the cart. In Amazon’s third and latest act in July of 2020, the company announced its Dash Cart, a departure from its two prior strategies. Just Walk Out may enable Amazon to penetrate the market more quickly, as the tech giant promises that existing stores can be retro-fitted in “as little as a few weeks.” Amazon can also get massive amounts of data to improve its computer vision systems and machine learning algorithms, accelerating the speed with which it can leverage those capabilities elsewhere. In this context, when customers are done shopping they can “just walk out,” and their credit card will be charged for the items in their virtual cart. Using cameras and sensors, the Just Walk Out technology detects what products shoppers take from or return to the shelves and keeps track of them.
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They don’t need to download an app or create an Amazon account. In Just Walk Out-enabled stores, shoppers enter using a credit card.
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Earlier this year, Amazon announced that it would license its cashierless Just Walk Out technology. While Amazon Go is vertically integrated, in Amazon’s second act, it revealed a separate, more horizontal strategy.

It could be 10 times as big.” Perhaps Amazon’s confidence in its ability to scale its Go stores comes from its vertical integration, enabling it to optimize the customer experience through control over store format and product selection and placement. However, executives at Amazon are confident they can scale, saying that “There’s no real upper bound. This is especially true if the computer vision AI-based system also must be retrofitted into buildings that come replete with previously designed nooks and crannies that can obstruct camera angles and affect lighting. At larger stores, tracking people and products gets more computationally complex, and larger SKU counts become more difficult to manage. When you’re done, you can simply leave the store, and Amazon will automatically charge you for the items you grabbed.Įarlier this year, Amazon opened up a new 10,400-square-foot Go store, which is about five times bigger than the largest prior existing Go store. As you shop, a collection of ceiling cameras and shelf sensors identify the items you grab and put those items in your “virtual” shopping cart. When you enter an Amazon Go store, you swipe your Amazon app at the entrance, enabling Amazon to link your purchase to your account. Amazon’s first act was its Amazon Go store, which opened in Seattle in early 2018. Case Study: Amazon’s leadership in grocery store technologyĪmazon’s foray into grocery store technology provides a succinct introduction into the state of the industry. From optimizing inventory management and checkout lines to finding high-quality groceries at consumers’ personal price points, the future of grocery store shopping promises to alleviate, and even eliminate, these points of friction. The future of grocery stores will be a win-win for both businesses and customers: with new technology, stores will strive to decrease their operational expenditures and consumers will want easier ways to shop. As COVID-19 accelerates the trend toward contactless shopping, we’re entering a new technological paradigm for how we shop for groceries. While the grocery store format has largely remained stagnant, the headwinds for grocery seem to be picking up, promising to usher in a new era for the shopping experience. Combine these demands with high operating costs, and the net margins for stores have become razor thin. Meanwhile, customers have come to demand 24-hour access and ever-present availability to shopping. The only differentiator between grocery stores of yesteryear and today is that stores have more diverse price options and product selection.

Yet, over the past century, nothing has really changed in terms of the fundamental structure of super markets: large or small, both the layout and customer experience of grocery stores are the same, made up of aisles, shelves, and lines. Since Piggly Wiggly’s explosive success, super markets proliferated around the world, and food and home goods shopping still predicates on the checkout lines Saunders first instituted in his shop.
