Amazon to Open Convenience Stores, Expand Grocery Market Footprint?
It looks like Amazon may be opening convenience stores to compliment them. The WSJ reports that Amazon’s Project Como is the retailer’s next step into the grocery market:
Amazon.com Inc. is pushing deeper into the grocery business with plans to introduce convenience stores as well as curbside pickup locations, say people familiar with the matter.
The Seattle company aims to build small brick-and-mortar stores that would sell produce, milk, meats and other perishable items that customers can take home, these people say. Primarily using their mobile phones or, possibly, touch screens around the store, customers could also order peanut butter, cereal and other goods with longer shelf lives for same-day delivery.
For customers seeking a quicker checkout, Amazon will soon begin rolling out designated drive-in locations where online grocery orders will be brought to the car, the people said. The company is developing license-plate reading technology to speed wait times.
An Amazon spokeswoman declined to comment.
The grocery stores, known internally as Project Como, are for now slated exclusively for customers of its Fresh subscription service, which promises same-day food delivery at set times, the people said. Last week, Amazon dropped its $299 annual price for Fresh and instituted a $15 monthly fee, available to members of its $99 Prime delivery service.
It’s not explicitly stated in the article, but it sounds to me like the convenience stores are the drive-in grocery stores currently under construction. (The article draws an inference to a connection but doesn’t state it clearly.)
All we know about those stores comes from the planning documents, but the descriptions and artist renderings suggest we are looking at the two parts of the same story.
It’s a pity that the new stores will be limited to only Amazon Fresh subscribers, but I wouldn’t expect that to last.
It’s one thing to pay extra for delivery of refrigerated groceries, but another thing to pay for the privilege of picking them up. When it comes to the latter there are just too many competitors like convenience stores and bodegas which don’t charge a membership fee.
In the long run Amazon’s convenience stores will have to adopt that practice of its competitors, otherwise the will simply cost too much for the convenience.