Beyond the numbers with Grant Thornton: Listen now
Already dominant in the online space, Amazon is ramping up its plans to eat into the $750 billion US grocery market.
After a year of experimenting with its Amazon Go tech-enabled small format grocery stores, the retailer is now phasing them out in favour of larger-format Amazon Fresh supermarkets.
These bigger stores retain the “Just Walk Out” technology tested in Amazon Go, but offer a much larger product range through a 3,000 square metre footprint.
Customers scan their Amazon app, or even their palm (!) to enter the store, with a series of sensors and cameras throughout the store monitoring the items placed into their shopping cart.
Shoppers are charged automatically for what’s in their trolleys and literally just walk out.
Bloomberg recently reported that Amazon has 36 Fresh stores in the pipeline, but other sources place that number much higher.
My colleague Kaitlin Hastie and I recently visited one of the new stores in Cerritos, Los Angeles on our way home from the NRF retail conference in New York.
Not content with just food, Amazon is also set to launch its first fashion store -
Amazon Style – in California later this year. At 3,000 square metres it will be a similar footprint to Amazon Fresh.
The store will range Women’s and Men’s clothing, as well as accessories from leading fashion brands. Only one sample of each item will be shown on the floor, with the bulk of the clothing held in the back of house.
To try on or buy an item, customers will scan a QR code using the Amazon app. These items will be transferred to a reserved and personalised fitting room, where a touchscreen will allow customers to browse similar products or request different sizes.
Amazon will use advanced analytics to drive suggestions based on the customer’s profile and liked items.
Amazon is crystal clear about the role of digital in retail. Online capability is now just table stakes, with the true power of digital being the ability to dramatically enhance the consumer shopping experience – both online and in-store.
What this shows is that traditional retailers in Australia cannot rest on their laurels. They must invest in an improved digital customer experience, both in store and online, to keep pace with the needs of the modern consumer.
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