Counterpunching AmazonGo

Unless you are living under a rock, you have probably heard of AmazonGo. At the time of writing this article, there were 10M+ views of the video Amazon made to show the world how it’s done. There have been millions of shares on Facebook and Linkedin, and the retweets ensured almost half the world has already seen the ‘future of retail’. For the benefit of the ‘living under the rock’ cohort, here’s how it works:
  • All you need to get started is an Amazon account, the free Amazon Go app, and a recent-generation iPhone or Android phone. Once you have the AmazonGo app, scan to enter the store and the store recognizes who you are.
  • Once inside, there will be no store assistants apart from the people baking and making fresh food on counters.
  • WiFi or Bluetooth LE connections will ensure customer recognition at every aisle.
  • Proximity sensors and cameras recognize that you have picked up a specific item from the shelf and it is credited to card/cash in your AmazonGo app.
  • If you put the product back, the item’s cost is deleted from the AmazonGo app and money is debited
  • You only need to bag the items and exit the store. No checkout lines. Your Amazon account automatically gets charged for what you take out the door.
Jetsons? Scenes from the spaceship in Wall-E? While the tech is surprisingly refreshing, and the experience is novel, the store is currently available in only one location, Seattle. Business Insider reported they had seen internal Amazon documents that described Amazon opening up as many as 2,000 stores, over the next ten years. That’s still not enough stores to cater to every shopper across the civilized world. This gives enough time for the rest of the retail world to catch up and start applying themselves to enriching the shopping experience. So how does a retailer go about counter punching the AmazonGo phenomenon? Do you need a $10M a year budget to develop labs that can prototype ideas? It’s simpler than you think. Advancements in retail are within the reach of every retailer that is inclined to collect data. Technologies are readily available to stitch a customized, personalized experience to shoppers that would not travel miles to get to the only AmazonGo store in their city. See what I did there? Here are 5 ideas that can be deployed in supermarkets and convenience stores in less than 2 quarters: In-store shopper tracking – One of the biggest challenges of shopping at a store is not knowing where your product is shelved. An average shopper spends about 12 mins looking through one aisle to find a product. As a retailer, you might argue that this is time well spent, they get to see all the other products on display. But as a shopper, this is the kind of shoddy experience that AmazonGo feeds on. Indoor positioning systems are now available to identify a shopper when they walk in and beams a virtual map of the store on their mobile device. You can search for the product that you are interested in and the virtual map takes you there, kind of like Google directions. Digital personalization – While AmazonGo is still testing grounds, Amazon, the virtual store has years of experience in personalizing the digital experience. If you have taken the ‘reverse Amazon plunge’ and started selling online, personalizing your website, app and communications should be your top priority. Recommend best offers and products, recommend products bought together, hot selling products etc based on personas, browsing history and past purchases on your website. You can send geo-relevant offers, best offer set, shopping and wish list based offers through your app. Dynamically present offer and content on newsletters, through a recommendation engine, using customer attributes such as home-store and lifestyle. Customer-centric assortments – Imagine the amount of data crunch that is being done behind the scenes of AmazonGo to ensure that the right product is available when the customer walks in. They have to get it right, there is no one to talk to and ask for the availability anyway. Your Category Managers can now continually optimize the product mix by recommending products to be dropped, retained, replaced or substituted. They can also identify complementary products that can be bundled based on purchase patterns, linkages and cross-sell opportunities. Additionally, there are now solutions that can recommend appropriate price points for products that are slow movers based on external factors and internal data. Use all these data to ensure you are carrying the right assortments and you never have an out of stock event in your store, ever. Real-time inventory insights – This one’s a biggie. This by far is the single biggest challenge that daunts any retailer and should be the first bullet on your 2018 wish list. Solutions now provide real-time information of potential out of stock situations and trigger purchase orders for stock, all automated. The other ‘simple fix’ is to trigger automated intra-store transfers for stock replenishment. Couple this with a solution that recommends markdowns for excess inventory and streamlines the overall buying process, and you are already making millions, by cutting your losses. Democratizing insights to store managers through mobile apps – While walking through a store without any human interaction and picking up your item and leaving the store might seem exciting the first few times, I think what makes shopping in-store appealing, are the interactions themselves. The biggest challenge in getting the store managers and associates to deliver at the moment of truth is lack of data and insights about the customer. They need to know what is relevant to them at the right time and medium. Communicating complex insights and information through emails is passé. Insights need to be communicated to the store operations team, comprising solely of millennials these days, through their mobiles and apps. They need to have access on-the-go and not have to go to a laptop/ desktop placed at a part of the store with the least footfall. I hope these pointers give you a head start in counterpunching the giant. If you are looking for a solution provider that has enabled multiple retailers with the above capabilities, take a look at manthan.com.

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Author- Santosh Kumar

Santosh Kumar
Santosh Kumar is a senior marketing professional with extensive experience in helping business’ get the very best in BI and Analytics Solutions. If your business is looking to adopt and leverage analytics in any form, he is the person you need to be talking to. Linkedin , Twitter

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