This year, Amazon introduced a few splashy physical store concepts that could shake up the brick-and-mortar landscape over the next few years.
Jason Goldberg, senior vice president of commerce at Publicis.Sapient, spoke with eMarketer’s Andrew Lipsman about what Amazon's most talked-about store format—its cashier-less Amazon Go locations—says about the company's business strategy and how it's disrupting retail's competitive landscape. Goldberg was interviewed as part of eMarketer's December report "The Future of Retail 2019."
eMarketer: You and I both had the chance to check out the Amazon Go store in Chicago. What do you think its cashier-less checkout concept tells us about where brick-and-mortar retail is headed?
Jason Goldberg: One of the larger trends is reducing friction from the shopping experience, and there are numerous ways in which this drives more retail success. When you say "cashier-less checkout," there's a variety of experiences in that spectrum. There are many scan-and-go experiences that make a lot of sense in certain contexts.
The actual Amazon flavor of computer-vision-based cashier-less checkout is pretty niche at the moment. That may be less true in 10 years. But today, the technology used at Amazon Go doesn't scale very well to a lot of bigger and more common retail formats. And it's not the immediate customer expectation—they won't expect to buy a big-screen TV from Best Buy or a gown from Nordstrom and just walk out of the store with it.
eMarketer: In which segments of retail does Amazon Go ultimately compete?
Jason Goldberg: If Amazon is reportedly opening 3,000 Go stores, it's because the company thinks there's an untapped market or low-hanging fruit in the grab-and-go lunchtime food sector—which is really what the Go store is.
It's not a convenience store. Amazon doesn't sell the items that normally sell well in convenience stores in the Go store. Amazon Go competes with [fast-casual restaurants] Au Bon Pain and Pret a Manger.
Its main value proposition is that it's much faster, easier access than even a Pret a Manger. There are some niches where that works, like hotel gift shops, unattended convenience stores and airports. The technology can be useful, but in the near future, you won't see it in a Kroger, Walmart or Costco—or any of the big retailers that make up the majority of consumer spending.Amazon is in this super-enviable position where it's a platform and every other retailer is not.
eMarketer: Do you think Amazon has a grand strategy behind the Amazon Go store concept beyond just growing sales through brick-and-mortar?