April 17, 2024

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Amazon Fresh Grocery Stores Trade 'Just Walk Out' for Smart Carts: NPR

Amazon Fresh Grocery Stores Trade 'Just Walk Out' for Smart Carts: NPR

The first Amazon Fresh grocery store will open in London in 2021. The company is replacing 'Just Walk Out' technology in US stores with smart shopping carts, but is leaving it in the UK

Leon Neal/Getty Images


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Leon Neal/Getty Images

The first Amazon Fresh grocery store will open in London in 2021. The company is replacing 'Just Walk Out' technology in US stores with smart shopping carts, but is leaving it in the UK

Leon Neal/Getty Images

As far as Amazon technology goes, “Just Walk Out” is in the pantheon: Early shoppers marveled at the concept of grabbing items from grocery shelves and simply leaving, followed by cameras counting the final receipt.

Amazon has invested heavily in this to push its fledgling grocery business beyond competitors — and in the process, transform the industry.

Now, it's taking the technology out of Amazon Fresh stores in the US (it's staying in the UK). Many experts wondered why it took so long: the experiment clearly failed to spread widely. The “just go out” revolution has not reached Amazon’s Whole Foods, let alone the industry.

This is a huge admission of defeat, although the company certainly doesn't accept the term. The technology will still be present in Amazon Go convenience stores and dozens of other convenience stores in airports, arenas, parks and hospitals.

But Amazon's cashier-free grocery ambitions are only changing, even as the retailer scales back its efforts to automate the entire supermarket experience. It's a safe bet now that the smart shopping cart can still change the way we shop for food.

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“This is a failure, but let's not forget that Amazon's success is built on failure,” says Guru Hariharan, CEO of CommerceIQ and former Amazon director. “That's the ridiculous part of it.”

Technology has yet to help Amazon win the grocery race

Grocery, a multibillion-dollar market that requires physical stores, has long been Amazon's final frontier.

The retailer got into the game late, opening Amazon Go convenience stores in 2016, buying Whole Foods in 2017 and launching Amazon Fresh Grocery stores in 2020. There are now more than 40 stores selling fresh produce, and just over half of them use the “just walk out” technique.

The marvel did not attract crowds. Shoppers often said they feel tired when passing through entry gates and are tracked by ubiquitous cameras and sensors. Amazon says people also wanted to see a running history of prices and discounts while they shop — not later, after they check out.

The technology is also expensive and complex. Equipping every nook and cranny of a supermarket with intelligent computer vision has proven unreasonable. It still requires some human involvement, with people behind the scenes helping the machines learn to interpret the video and clarify uncertainties.

“Expectations of accuracy from the consumer on this are incredibly high,” says Hariharan. “Is it 100% accurate, 100% of the time? If it's not, it creates consumer trust issues.”

Enter the smart shopping cart

The smart shopping cart gave Amazon a mini-tech solution.

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In recent years, the company has overhauled Amazon Fresh, laid off workers at stores, closed some stores and renovated others. It also changed its smart design Dash wagonreeling in its technological complexity.

The cart was now essentially a self-propelled operation on wheels. Shoppers can view products in front of built-in scanners, a scale can weigh products, and a touch screen can display real-time receipt updates.

Amazon has rolled out Dash Carts in a few Whole Foods stores, but has not said when or if they will become ubiquitous. The high-tech karts will face competition from many smaller companies offering smart karts.

Amazon will likely be able to sell its cashier-less carts to many retailers, including competing grocery stores. Hariharan sees a big financial opportunity in marketing on cart screens, where advertising has become one of Amazon's fastest growing businesses.

All of this, of course, depends on shoppers' learning curve with new technology, says Uttara Ananthakrishnan, who studies the digital transformation of the grocery industry at Carnegie Mellon University.

Recently, retailers have reconsidered their approach to self-checkout because it is vulnerable to theft and errors by shoppers. Grocery stores are a very difficult place to introduce new technology, Ananthakrishnan says.

“There is a huge variety of products. Not everything has a symbol. There are a lot of things that need to be balanced,” she says. “Then you put the onus on the customers, and a lot of people don't like that.”

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Editor's note: Amazon is among NPR's financial supporters.