As we all know, when Amazon Go was first proposed in late 2016, it caused a wave of turbulence in the retail industry, especially in China. Unmanned convenience stores have taken root and sprouted like bamboo shoots after rain in China, and people are now familiar with the trend of opening stores. But Amazon Go, the originator of the space, is still making a lot of noise in the industry after a year’s delay.
In the face of China’s indigenous unmanned retail, Amazon Go is unique
“No lines, No cash” is the core form of Amazon Go. There are No queues and No cash. “Just walk in, take what you want and walk out” is the three steps. This new form is an innovation and subversion of the traditional entity convenience store operation mode. It took a lot more effort and cost to make this happen than we realize, and that effort is what makes Amazon Go three unique.
** First, enrich the solid data base with high cost input. ** In the second half of last year, Amazon bought Whole Foods Market’s 460 upscale grocery stores for $13.7 billion to gain access to the richest and most comprehensive offline brick-and-mortar store data. Whole Foods is an American supermarket chain founded in 1978. It became famous for its high quality of life, green and healthy food, and environmental protection, which enabled it to hit a nerve with the American middle class.
While Whole Foods’ organic, natural model is now priced too high and lacks a barrier to the lower-priced integrated chains, it still has the ability to give Amazon a leg up on Wal-Mart. In other words, Whole Foods plays an important role in the field of physical retail. Its accumulated consumer user data and physical store experience resources will become a powerful arm for Amazon to enter the offline market, and will also play an important role in the construction and popularization of Amazon Go.
** Second, tens of millions of dollars to create high-quality and cutting-edge technology services. **Amazon Go uses the computer vision system in self-driving technology, combines deep learning algorithms and sensor fusion to create the “Just Walk Out” system. Earlier, the establishment of unmanned convenience stores in China focused more on the technology of recognition and payment. Facial recognition, fingerprint recognition, product recognition and other technologies as well as self-service scanning code and other payment methods made the consumption of unmanned stores not as smooth as expected. Now Amazon Go’s technology is clearly an industry invention.
Amazon patented technology involving RFID sensors two years ago, and now sensors on shelves recognize pickup behavior in Amazon Go stores, black-box cameras on the ceiling track and capture consumer movements, and DEEP AI learning algorithms, Consumer behavior will be processed and analyzed in the store after multi-form fusion, judging the final shopping results of consumers. Deep technical development is clearly the most difficult barrier for Amazon Go to break.
** Third, Amazon Go’s pursuit of user’s ultimate experience. ** The Wall Street Journal reported that Amazon Go’s launch was delayed for a year because the tracking technology wasn’t up to par. But Amazon Go vice President Puerini later denied that, saying the delay was mainly due to excessive demand from employees. In short, higher requirements were put forward in the internal testing process and the opening was delayed.
In fact, the delay has been interpreted in many ways, but amazon’s pursuit of the ultimate consumer experience is perhaps the most appropriate commentary in terms of its online marketplace layout. Amazon has been loss-making since its founding, but that hasn’t stopped it from becoming the world’s largest retailer of products and enjoying a reputation that suggests the company is not focused on short-term profits. What’s more, with reliable and stable online revenue, Amazon Offline may be more obsessed with consumer experience.
To sum up, Amazon Go has devoted countless efforts to build it, from the investment in high-cost data and technology to the efforts made for consumer experience. Finally, Amazon Go has fulfilled its expectations and formed the three key feature barriers.
Amazon Go is neck and neck against unmanned retail in China
From the efforts made by Amazon Go, it is not difficult to see that Amazon Go’s decision to become an unmanned convenience store is fundamentally different from domestic localization enterprises. So when it comes to the impact of Amazon Go on China’s indigenous unmanned retail enterprises, we can compare and see that the impact comes from two aspects.
In one respect, Amazon Go dwarfs domestic unmanned retail. Since the concept of Amazon Go was put forward, it was tested internally at the end of 2016 and is expected to open to the public at the beginning of 2017, which shows that Amazon thought at that time that it would lead the way and trigger the revolution of the unmanned retail industry. However, due to the unexpected “imperfection”, this opportunity was seized by others, and Amazon Go became a follower instead. There is a difference between the concept of domestic indigenous unmanned retail and Amazon Go, but the latter has stronger advantages in further polishing the experience.
It can also be said that domestic localization of unmanned convenience stores is a misunderstanding and misreading of Amazon Go. It only cancelled the cash register, restrained consumers through technology, and provided self-service settlement channels for consumers, but the whole process was still obstructed. As for the consumption experience of Amazon Go, “just like stealing things”, the consumption is directly taken away, so that the pattern of unmanned retail is refreshed again, and the experience is also elevated again.
On the other hand, unmanned retail in China is losing out to long-term competition. Objectively speaking, the positive side is that high costs and heavy assets hinder the large-scale expansion of Amazon Go, making it difficult for it to reach a wide market in a short time. Offline retail itself has limitations in geographical location. Amazon Go in Seattle is the only one with fixed consumer groups, which cannot compete with the localised unmanned convenience store in front of us. In the tuyere industry, the priority to seize the market is inevitable, first touch users, after polishing the experience is the right way. Now Amazon Go’s ability to reach consumers in a short period of time is inevitably lower than that of Chinese companies.
But on the flip side, the longevity of the enterprise will be directly determined by the user experience. As an online retail giant, Amazon still acquired the most accurate and professional offline data through the acquisition of Whole Foods. Coupled with its original and challenging sensor fusion technology, Amazon Go’s more sophisticated consumer experience will have a profound impact on the domestic market.
Therefore, In terms of short-term market share, Chinese enterprises should give priority to users and constantly improve and optimize consumption experience on this basis, which can be regarded as a delaying strategy. In the long run, Amazon Go, though late to the game, is expected to emerge as the industry leader and the ultimate winner.
The future of unmanned retail, users have the world
Through the analysis of Amazon Go’s characteristic barriers and the comparison of unmanned retail in China, we can see that it is the side that pays more attention to users that ultimately plays a decisive role in an industry. The two have advantages in market width and depth, and now they are equally matched. In the future, user experience in unmanned retail will always be the core competitiveness.
Today, Amazon Go offers an absolutely efficient consumption model. Comparing the operation mode of unmanned convenience stores in China, whether it is jd X unmanned supermarket exposed by JD at the end of 2017, Tao Coffee pop-up shop and WithAnt of Ali Ant Financial, or We Life unmanned pop-up shop launched by wechat Pay and Easy Go, they are all inseparable from scanning code and other consumption operations, but without artificial supervision. Intelligent control. Amazon Go’s perception and expectation of efficiency is undoubtedly much higher than that of China, so it has a completely liberated consumption state that can be taken and left at will. Efficiency has no boundary, and deep technology polishing is still to be broken through.
As mentioned above, Amazon Go may be delayed due to the imperfect consumer experience, which shows Amazon’s obsession with consumer experience and its “indifference” to short-term revenue. Even now, estimates for the technology cost of Seattle’s first Amazon Go are in the tens of millions of dollars. As we can imagine, if the wind catches up with the wind, it will be scattered, and the lagging consumption and not smooth experience are destined to end early. High-end and high-quality unmanned retail service experience is the focus of retail.
In the current situation that China’s unmanned retail industry is crowded with enterprises and giants are crowding into the market, the emergence of Amazon Go is equivalent to reshaping unmanned retail and recreating the form of unmanned convenience store. From another perspective, it also gives China’s unmanned retail development a new goal and direction.
In general, unmanned convenience stores are the draught, but the players are strong, the layout of enterprises at home and abroad is uncertain. Although Amazon Go has the advantage of experience, it is also the growth space of unmanned retail in China. Although there is a broad enough market in China, Amazon Go takes the lead in its long-term development with the help of online’s deep cultivation in user experience. It has to be said that user experience has a profound impact on the development of unmanned convenience stores. With Amazon Go’s redefinition of unmanned supermarkets, domestic enterprises also have a new direction.
Liu Kuang, Meditation on the Internet, wechat official account: Liukuang110, this article was first published on Xinhuanet.com