Will Amazon Go change retail as we know it?

First pilot store opens in Seattle

Written by Fiona Cashell

Amazon has unveiled its first brick and mortar store, prompting both intrigue and confusion from customers. After testing the concept exclusively for employees, the first Amazon Go location has opened on the ground floor of the company’s Seattle headquarters. The idea behind the store is best summarized by its slogan — “Just walk out!”

Customers scan their Amazon Go app before they walk into the store and then take items they want to buy off the shelves. Their actions are monitored by sensors and cameras, and upon leaving the store with their items, their personal accounts are charged.

The store is stocked with a number of grab-and-go snacks and basic groceries, with employees prepping meals in the kitchen-style area of the store. The retail establishment has gone through rigorous testing to make sure its system is reliable, including having employees run around the store in identical Pikachu costumes. The sensors still managed to charge each individual with the proper amount. Still, the test for the Amazon Go store has not been without its own technical difficulties. There have been reports that the system has crashed in the past when the store was crowded.

Some retailers have expressed concern that this new type of shopping experience could have a negative impact on retail worker jobs. According to a report by USA Today, in the United States, cashier is the second most common job. Similarly, with the rise in minimum wage in Ontario, some are concerned that automated services will soon replace retail workers.

These worries are not new, as the increased usage of online shopping and automated checkouts has redefined the retail world. However, data indicates that customers still prefer human interaction and face-to-face contact when shopping. Over the 2017 holiday season, although purchases online increased, they only made up 30 per cent of sales according to The Globe and Mail. Furthermore, automated checkouts may appear to provide speed and convenience, but technical issues can cause irritation and delays. Others argue that by using these services they are providing unpaid labour to a company in lieu of them hiring salespeople. It is also worth noting however, that the Amazon Go store will not be totally devoid of employees. Employees are stationed outside to greet customers as well as inside to answer questions and to check IDs for alcohol sales. Beyond preference, there are also some other barriers that could limit the store’s success. Having an Amazon account, a credit card, a cell phone, and a data connection are all necessary to shop at an Amazon Go store. These requirements may limit the number of customers who are able to shop at the store at any given time. Furthermore, the ability to sell produce within the store is limited as there is currently no way of measuring the weight of items taken off the shelves.

The store has also raised some ethical concerns and questions. For example, how will shoplifting be defined in a store that encourages you to take what you need and go? Amazon Go vice president Gianna Puerini told The Washington Post that these errors occur so infrequently that loss of revenue isn’t an issue, and customers are free to keep the items that they accidentally weren’t charged for.

The seemingly convenient aspect of the shopping experience could also have a negative impact on credit card debt. A study conducted by McDonald’s back in 2004 showed that individuals will spend more money at self-serve kiosks because they feel that their choices aren’t being judged by another person. In Canada, the average consumer debt is roughly $8,539.90, excluding mortgages.

The store has certainly become a novelty for locals and tourists alike in Seattle since its opening on Monday, Jan. 22. Only time will tell if the convenience of Amazon Go will attract customers after the novelty has worn off.

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AMAZON HQ2 IN GUELPH?

Written by Tiann Nantais

The City of Guelph has teamed up with other southern Ontario municipalities as part of Toronto Global, the only Canadian contender remaining in the bid for the new Amazon headquarters. After reviewing 238 applications, Amazon has selected the top 20 contenders, which include New York City, Chicago, and Denver.

Given the world-class agri-food sector at the University of Guelph, Mayor Cam Guthrie told CJOY Radio that, “With Amazon purchasing Whole Foods, getting into foods and groceries, we felt that Guelph could really be a player to support the Toronto Global bid to Amazon.”

According to Global News, Amazon plans to invest $5 billion into the new headquarters, not to mention the creation of 50,000 high-paying jobs in Amazon’s new hometown. A decision on the location of HQ2 is expected later this year.

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How do you feel about a store without any employees? And what about the potential loss of jobs?

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