Amazon Fresh: The Role of Physical in a Digital World

By Scala Team
March 11, 2021

What does the opening of a UK bricks and mortar Amazon stores say about the future of in-store retail?

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The first UK Amazon Fresh shop has opened its doors in West London. I’m excited. Amazon is a trailblazer and the online giant taking their know-how into a bricks and mortar space will offer a lot of learnings for retail of all stripes. The “Just Walk Out” technology being employed in the Amazon shops offers not only ease for shoppers but also invaluable insight for the retail brand, and I am excited to see if and how it is adopted by other high street players. That Amazon has opened dozens of shops in the US and is poised to open several more speaks to the longevity and importance of the physical retail space in a brand’s mix of customer touchpoints.

The integration of QR codes, sensors, screens and apps seems to offer unparalleled convenience to the shopper and insight to the retailer. The idea of being able to check into a shop and literally dash in for a loaf of bread or a pint of oat milk without having to wait in a queue is appealing and something that I can see a lot of shoppers signing up for. The application of the technology and the ability to check in and simply take what you want has applications beyond the grocery setting currently being offered by Amazon. A ‘quick Pret’ will be that bit more speedy if you can simply pick up your wrap and packet of crisps and leave without waiting to queue behind those making coffee orders. Clothes shopping becomes an opportunity for a quick change with items tried on and then worn out of the shop.

The technology offered by Amazon feels new but elements of it have already been in place for a long time now and can be adapted and implemented across a variety of retail spaces. Besides the till-free purchasing, checking in with a QR code is something many of us have got used to during lockdown and something that smart retailers will continue to utilize moving forward. Checking in using a store app will encourage loyalty and for customers, could unlock promotions and personalized suggestions via their personal device or on integrated digital signage. Given the right permissions, sensors in the store could work with the shopper’s personal device and signage to display information that might be of interest — such as available sizes, background on the manufacture of the product or, in the case of food, nutritional information or perhaps recipes based on what ingredients have already been selected. Sensors can also play a role in helping stores offer the best service to their clientele by giving invaluable insights to help them with placement of products and staff.

Staff have an important role to play in any retail setting. Used well, technology makes the most of the staff in the store and the expertise that they have. Maybe it is the month of lockdown talking, but I miss good one-to-one service. I’ve always valued the insight of those more knowledgeable than myself, whether it be the advice of staff at my local garden centre, the recommendations of the waiting staff at my favourite restaurant or the smile and small talk from my local barista. This service is part of why I choose to shop in the establishments that I do. Even in a setting without tills, there will still be the need for staff for assistance and advice. In fact, the use of sensors gives brands invaluable insights as to staffing allocation — where best to place staff to assist shoppers and the times of day when they will be the most needed.

So on one hand, there are worries that shopping in a shop without tills is too anonymous while on the other, there are calls that shopping in a shop of sensors and cameras isn’t anonymous enough. Some call the Amazon offering “dystopian” and voice concerns around privacy. In the Amazon Fresh shop, purchases are tracked through a variety of sensors and cameras and it is only through the app that shoppers are identifiable. There is no facial recognition and data is only held for 30 days. In recent consumer surveys, it seems that by and large, shoppers are still not completely comfortable with facial recognition in retail, even if we’re comfortable with self-service checkouts which utilize an element of facial recognition technology. Data and privacy will be a continuing concern for some with research suggesting that the older you are, the more cautious you’re likely to be.

For me, the most important thing is choice. Brands compete by offering something different. For some, the difference is pricing, for others styles, quality, range or expertise. Convenience is another area on which brands compete and the Amazon shops are clearly hoping to win that particular competition. Going by the initial consumer reactions to and reviews of the shops, Amazon will win some customers while some others won’t want to download the app, may not feel comfortable with the process or may choose what they feel are better products elsewhere. For some, self-scanning in the aisles of Waitrose will be their ideal grocery experience while others depend on their weekly chat with Agnes on till seven. What excites me about the opening of Amazon Fresh is that it adds new possibilities to retail and opens the discussion about the importance of choice and implementing effective touchpoints for customers. When lockdown allows for me to travel down to try out the store, I will be there, trying out the technology and the vegan cookies (I hear they are delicious).

Darren Cremins is a Senior Sales Director at Scala for the UK and Ireland regions. As 20+ year digital signage industry expert, Darren primarily helps retailers engage with their customers. Throughout his nearly 10 years with Scala, Darren has developed a strong focus on combining not only the Scala solutions, but the complete STRATACACHE family of solutions into the UK & Ireland market in this ever-changing world of marketing technology and digital signage.