Amazon Go’s ‘vision’ for the future
E-commerce giant Amazon has opened just a handful of locations of its small-format retail stores, called Amazon Go, but they are capturing a lot of headlines.
The “just walk out” technology relies on a high-tech network of cameras and shelf sensors that allow customers to fill their shopping bags and leave the store without scanning a thing or going through a checkout of any kind. Instead, shoppers scan the Amazon Go app to enter the store, and they are automatically charged for any items they select when they leave the store.
Stewart Samuel, program director at IGD Services Canada, said he’s been impressed with the Amazon Go experience, and noted that the sensor technology has worked every time he’s visited the store. “From downloading the app to shopping in store, Amazon has put the customer experience at the heart of this development,” he said.
Although the debut of the Amazon Go technology was delayed for several months, while the company worked out the bugs in the technology, Samuel said the company has since quickly accelerated its deployment to five Amazon Go locations. “I would expect this technology to be rolled out to more stores in new U.S. and international cities over the next few years,” he said, noting that some European operators are testing similar solutions, including Sainsbury’s in the U.K. and Albert Heijn in the Netherlands. He also said that shopper receptiveness will play a key role as retailers weigh the costs of such solutions.
William Hogben, CEO of mobile checkout solution provider FutureProof Retail, predicted that vision-based systems like the one at Amazon Go represent the direction that smart checkout tech will eventually pursue. “The long-term future is going to be vision-based systems like Amazon Go, because the algorithms are open source — anybody can do it, and it just gets better and better as the computing power grows,” he said.
Hogben said that vision-based systems still are very early in the development stages, and that Amazon Go operates with a very limited product selection, which makes the system more feasible. The stores, though function more as a proof of concept than a replicable model.
“They actually have more staff than a regular store, and that’s very expensive hardware in the ceiling,” Hogben said,
Raymond Pucci, director of merchant services at Mercator Advisory Group, agreed, that cashier-less technology like the system at Amazon Go is not for all retailers. “I think it requires a lot of investment, and it probably requires a lot of technical support, as well,” he said. “It’s not for smaller-sized companies.”
KPMG projects big, millennial-driven Cyber Monday
Cyber Monday is set to be a busy one.
Almost one-third (31%) of consumers are expected to shop on Cyber Monday this year, up 4% from last year. That’s according to a KPMG 2018 holiday shopping season survey of over 1,000 consumers. In other shopping trends, Black Friday shopping is expected to stay constant with the previous year at 44%, while Thanksgiving Day shopping is expected to decrease to 9% from 10% the year before.
The study found that 15% of consumers plan to spend more money this holiday season versus last year, with one-third of them doing so online. Higher income households, as well as millennials, also indicated that they are adopting online shopping faster than lower-income households as they rapidly turn to online and mobile technologies to take advantage of holiday deals.
“As more consumers turn to online shopping this holiday season, retailers are expected to escalate their efforts to deliver seamless and personalized customer experiences both online and in-store,” said Mark Larson, national leader of KPMG’s Consumer & Retail practice. “Consumers expect a convenient and consistent transaction experience, which is customized to their needs, while also protecting the privacy of their information.”
In other findings:
- Of those planning to shop on Black Friday, 74% indicated that they plan to shop both online and in-store on that day, versus 68% from last year;
- Those shopping just in-store on Black Friday are expected to decrease to 12% from 17% the year before;
- Eleven percent of millennial respondents expect to spend more on just online purchases during the 2018 holiday season, compared with 7% of non-millennials; and
- Sixteen percent of millennials and non-millennials expect to spend more both in-store and online during this holiday season versus last year.
Bernie Sanders’ new bill takes aim at Walmart’s wages
U.S. Sen. Bernie Sanders’ latest legislative effort has the world’s largest retailer in its sights.
The senator from Vermont introduced a bill on Thursday that would prohibit large companies from buying back stock until they pay all employees at least $15 an hour. The proposed legislation, called the “Stop WALMART Act,” is co-sponsored by Rep. Ro Khanna, D-Calif., and would also require large employers to give workers up to seven days of paid sick leave for themselves or to care for a family member, and cap executive compensation at 150 times the median employee wage. Under the bill, companies with more than 500 workers would face these new restrictions.
Sanders fired off a series on tweets this week in which he railed against the federal minimum wage – $7.25 per hour – and the Walton family. Among his tweets was one that stated: “The Walton family of Walmart is the wealthiest family in America, worth $180 billion. Middle-class taxpayers should not have to subsidize Walmart’s horrendously low wages to the tune of at least $6.2 billion every year.”
In a statement, Walmart noted it has increased its starting wages by more than 50% in the last three years and currently has an average hourly total compensation of more than $17.50 an hour.
“At the same time, we’ve also added new benefits like paid time off, advanced job training, paid family leave and college for $1 a day,” the company said. “In addition, our associates continue to earn quarterly cash bonuses – more than $625 million last year alone. We have been very deliberate about our job offerings and we will continue listening to our people and investing in the training, benefits and wages that they tell us are important.”
In calling out Walmart, Sanders is employing a strategy similar to what he employed against Amazon back in September when he introduced the STOP BEZOS Act, which would have imposed a 100% tax on large employers equal to the amount that their workers receive in public assistance benefits. The bill, like this latest one, had almost no chance of passing the Republican-controlled Senate. But in October, Amazon announced that it was increasing its minimum wage to $15 for all full-time, part-time, temporary and seasonal employees across the United States.
Walmart also said it offers a wide variety of career opportunities to people of every background, low barriers to entry for a first job, and competitive wages and benefits.
“As much as a starting wage is important, it’s just that – a starting point,” the company said. “Our associates have told us that it’s about much more than just a starting wage. It’s also about benefits, scheduling, training and the opportunity to advance in their jobs – all important parts of a meaningful job experience.”
We want to be the type of company that makes it easy for people to get in the door and empowers them to grow as far and as fast as their skill and hard work will take them. Last year we promoted more than 230,000 people to jobs of greater responsibility and higher pay, and more than 75% of our store management teams started as hourly associates.”
In response, the e-commerce giant raised its minimum wage