Several outlets have reported that Amazon are set to pull the plug on their brief foray into UK grocery stores.
The Amazon Fresh stores opened up in 2020 and offered completely till-less payment. A mixture of cameras and automative technology saw customers able to simply pick up what they wanted and leave the store, with a digital receipt sent to them shortly afterwards.
In the midst of the pandemic, this minimal-contact shopping experience sounded like the future of retail. Five years on, however, and it appears to have been a failed experiment. But what exactly went wrong for Amazon Fresh?
The ‘Just Walk Out’ system
It’s difficult to argue against this being anything other than a failure.
That’s not to say that it didn’t work, though. In fact, the technology itself appears to have worked really well. Despite that, however, the public take up of it has been mixed to say the least.
Even the few Amazon Fresh stores that remain in America have ditched the futuristic payment system in favour of ‘Dash Carts’. Although these special payment carts seem to be a clunkier method of payment, the public have adopted them easier than their predecessor.
It seemed a case of new technology being pushed too aggressively. If we look at how long it took for the gradual adoption of self-service tills and scan-as-you-shop facilities, we can see that the public need to be eased into changes in their shopping routine.
Trust and security
Amazon Fresh shoppers reported some uneasiness with the no-till system. There was concern that items that had been picked up only to be returned to its shelf later would be charged for, and that it was trickier to keep tally of what had been spent.
Without prior knowledge of how accurate the system was, the shopping experience provided an unnerving feel of a lack of control for many.
In terms of security, there’s a large portion of the British public that distrust big tech firms and don’t want to provide them with any more data about themselves. In addition to all of the details Amazon gain on creating an account with them, there can also be a lot of information gleaned from what groceries customers buy.
Of course, established supermarkets already mine this data through loyalty cards, but this is done far more discreetly and under the guise of a reward for the shopper.
It can be argued that in terms of data security, Amazon hasn’t done anything differently to other British retailers, but while cameras around the likes of Tesco and Asda seem set up to protect against theft, those in Amazon Fresh stores are there to identify you and what you buy.
Branding
The Amazon name and logo is entrenched in tech and never sat comfortably within the grocery space.
It seems that Amazon themselves have noted this and are keeping a handful of Amazon Fresh sites for the purpose of turning into Whole Foods stores instead (a brand they acquired some time ago).
Besides this, Amazon have already courted controversy on these shores for avoiding having to pay their UK business taxes. While many still use the online behemoth for their online shopping, there are still plenty that prefer not to use them for this reason.
What does Amazon do now?
Ironically for a no-till business model, Amazon’s might is such that 19 store closures will barely register.
That being said, grocery retail remains one of the biggest markets they have yet to gain a foothold in, and this is unlikely to be their last attempt at succeeding in this space.
Amazon Fresh stores remain open in the US, but the tech giant’s decision to use the Whole Foods brand to reopen five of their sites instead looks like a safe move. Whole Foods has such a strong profile in the States that its presence in popular culture make it a recognisable name here too.
Of the other 14 stores, it’s rumoured that Tesco and Sainsbury’s are ready to duke it out for the sites to expand their convenience store offerings.
Lessons must surely have been learned about the UK grocery market from this venture, and it’ll be interesting to see how Amazon follow this up in the future should they choose to return.
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