Amazon’s Fresh Stores: Why the “Just Walk Out” Revolution didn’t Come to the First Stages of Retail Technology (Extended Abstract)
The cart is no longer a check-in device. Shoppers can hold up products to built-in scanners, a scale can weigh produce, a touch screen can show real-time updates to the receipt.
The Fresh grocery stores that are operated by Amazon are located in California, Illinois, Virginia and Washington state. Whole Foods is owned by the company, as well as Amazon Go and cashier-free convenience stores.
In 2023, Amazon CEO Andy Jassy wrote in his annual letter to shareholders that Amazon was working to find the right formula that will allow it to have a larger impact on physical grocery. Some Amazon Fresh and Go stores were shut down because they weren’t meeting the company’s standards, and early last year they paused their Fresh store expansion.
In November, the company reopened three Fresh stores in Los Angeles, California. Amazon is focused on remodeling most of its stores and opening new Fresh stores, according to the company’s spokesman, Golden.
Now, it’s taking this tech out of its Amazon Fresh stores in the U.S. (It’s staying in the UK.) Many experts wondered what took so long: The experiment clearly failed to spread widely. Amazon’s Whole Foods did not come to the “just walk out” revolution.
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The tech is expensive and complex. The store had a smart computer vision, so it was unreasonable to out fit every part. And it still required some human involvement, with people behind the scenes helping machines learn to interpret video and clarify uncertainties.
“The accuracy expectations from the consumer on this are unbelievably high,” Hariharan says. “Is it 100% accurate, 100% of the time? If it is, then it will lead to consumer trust issues.
The Dash Carts are in a handful of Whole Foods, but they aren’t saying when or if they’ll be ubiquitous. The high-tech carts are in competition with smaller companies.
The changes in the grocery industry depend on shoppers’ learning curve, according to Uttara Anantha Krishnan, who teaches at Carnegie Mellon University.
Lately, retailers have been reconsidering their approach to self-checkout because it’s prone to thefts and mistakes by shoppers. Ananthakrishnan says grocery stores are a particularly hard place to introduce new tech.
There is a lot of different types of products. Not everything has a code. She says a lot of things need to be weighed. “And then you kind of place the onus on the customers, and a lot of people don’t like that.”
The marvel did not draw crowds. Shoppers often said they felt weary passing through entry gates and being tracked by omnipresent cameras and sensors. Amazon says people also wanted to see the running tally of prices and discounts as they shopped — not later, after leaving.
“This is a failure, but let’s not forget that it is Amazon’s success that is built on failures,” says Hariharan, the CEO of CommerceIQ. “That’s the ironic part of it.”
The company doesn’t accept that term, so the admission of defeat is a big one. The technology will still live on at Amazon Go convenience stores and dozens of other smaller shops at airports, arenas, amusement parks and hospitals.
As far as Amazon’s gee-whiz technology goes, “Just Walk Out” is in the pantheon: Early shoppers marveled at the concept of grabbing stuff off grocery shelves and simply leaving, tracked by cameras that calculate the eventual receipt.