Why would Amazon, with its primarily online offerings, develop new and advanced technology to facilitate physical, in-store purchasing? Because it knows that such advances can help secure its dominant position for the future, whether it decides to open new physical store operations or sell its technology innovations to other retailers—or both.
Amazon’s Just Walk Out checkout technology already is installed in its experimental Go stores, enabling shoppers to gather the items they want and leave without ever going through a checkout line. They use a credit card to gain access to the store, and then sensors, both on each product and throughout the store, determine what items they have taken and charge the card when they leave.
To build on these internal operations, Amazon has build a shopping cart equipped with the Just Walk Out technology too. Using visual algorithms and advanced sensors, the cart can determine what items a shopper has put into it. Again, the shopper’s credit card gets charged for the purchases, without requiring any further effort by the consumer. In addition, a screen integrated into the cart allows shoppers to sign in to their Amazon account, so they can track shopping lists they created at home with the help of their Alexa device or double check prices.
The cart is slated to be introduced soon in a single Amazon store in California, but clearly, it could be expanded to other stores, whether owned by Amazon or maintained by other retailer chains. Those competitors would simply need to invest in purchasing the technology and carts from Amazon to attain a highly sophisticated way to make shopping easier and quicker for their customers.
Such spread is likely a goal for Amazon, according to its parallel efforts to push sales of Just Walk Out. Some early reports indicate that it is in negotiations with retailer operators located in airports, as well as a national movie theater chain, to license the technology. However, its expansion seemingly has been limited by the substantial investments these buyers would need to make, in that they would need to purchase the technology but also retrofit their stores to install sensors. Arguably, the cart might be the more workable, affordable solution for various retailers to leverage the opportunities that Amazon first built for itself but now is seeking to share.
Discussion Questions:
- How does the cart facilitate the spread of the Just Walk Out technology tool?
- Why is Amazon seeking to sell its proprietary technology to potential competitors? What are the pros and cons of doing so?
Source: George Anderson, “Did Amazon Just Put Its Go Technology in a Shopping Cart?” Retail Wire, July 15, 2020; George Anderson, “Will Rival Retailers Buy Amazon’s ‘Just Walk Out’ Technology?” Retail Wire, March 10, 2020