Amazon Go is the Future of Cafeterias, Not Grocery Stores
Amazon’s new bricks-and-mortar grocery store doesn’t have at least one thing that supermarkets have – queues at the checkout counter. The online shopping giant’s new 1,800-square-foot convenience store, Amazon Go, in Seattle uses sensors to detect what shoppers have picked off the shelf and bills it to their Amazon account if they don’t put it back.
Amazon Go, currently available only for its employees, is expected to be publicly available early next year, the company said on Monday. Apart from groceries such as bread and milk, the store also offers ready-to-eat breakfasts, lunches and dinners made fresh by on-site chefs and local kitchens and bakeries, Amazon said.
Everyone is calling this a grocery store, but in its current form it is more of a new concept for a cafeteria or an automat. It’s not just that the location is small, but also that the selection is limited to snacks prepared on-site, basic groceries, ready-to-eat meals, and Amazon Meal Kits.
This is not going to have Krogers quaking in their boots, although it might give convenience store chains like United Dairy Farmers sleepless nights.
The demo store just doesn’t carry enough items compared to the average grocery store, much less supermarkets, and furthermore, this concept is going to run into problems when introduced to a population which might not own smartphones.
This idea isn’t going to work for convenience stores, much lesss supermarkets. No, the only companies who should be concerned about Amazon Go (in its current form) are ones in the food service industry.
Once Amazon works the bugs out, this would be a great way to run a college cafeteria. Amazon’s system would require a greater upfront capital investment but the automation would also reduce the operating costs.
This idea won’t work with the general population because you can’t assume that all customers have the requisite app, but if an Amazon Go replaced a college cafeteria then it would be safe to assume that all of the college students would have the app.
Many schools require a student ID for the student meal plan, and if they cut a deal with Amazon then they would require that students use Amazon’s app (or perhaps they’d put an RFID chip in the student ID).
That is the perfect market for Amazon Go, and it would also have the added benefit of tying college students to Amazon in even greater numbers.
Amazon currently operates or plans to open nineteen pick up locations on and near college campuses. How much do you want to bet that those locations will soon be complimented by Amazon Go stores?