Amazon just announced that it will be opening up its first brick-and-mortar retail store in the first part of next year. While they’ve only announced a single location (in Seattle), there is little doubt that more will follow, especially if the first is the rousing success it will likely be (though Amazon has flatly denied rumors of thousands of planned locations).
Amazon’s store will have no cash registers. No Cashiers. No payment lines. Just walk in grab what you need and walk out. Don’t worry, there aren’t police waiting outside for you: a sophisticated surveillance system within the store tracks your every movement (in a non-disturbing way).
This system, combined with AI and Deep Learning, keeps an eye on everything you pick up from the shelves. It will add what you put into your physical shopping cart to your digital cart. Change your mind? No problem, put it back on the shelves and it will remove the item from your digital shopping cart as well!
The other part of this store is a robust consumer-facing mobile app, also named Amazon Go. Shoppers will download the app and use it to notify the store that you are getting ready to shop. When finished, shoppers will simply leave the store with their groceries and the app will charge the users saved payment method.
But why is this relevant to the local mom and pop store, or to the small local grocery chains? Because for once, you have an advantage over Amazon: You already have an established location – or locations – with an already consumer market. Plus, you have SDI’s AI for app development experience;).
There are further advantages to building an app like Amazon Go, even (maybe especially) for small local businesses. So let’s talk about some of them, and the tech that makes this whole project viable.
How Amazon Go Works
Amazon’s Explainer video was heavy on words and light on the explanation. But really, it appears to work using a potent combination of Microphones and cameras throughout the store. When Shopper opens up the App, the store identifies their location using these devices and then tracks them as they move through the store.
These Cameras track the shoppers, capturing pictures of consumers when they pick up something or stop in front of a shelf. Then, the Amazon’s advanced algorithms (similar to those used in Digital Assistants), sorts through the photos of the products you’ve picked up comparing it to saved photos and stocked items. When it finds a match, it’s added to your virtual shopping cart.
Microphones and other sensors are also used to confirm when something is picked up, and to mark when something is set back down. The AI/Deep Learning is so advanced that it can determine who a customer from a snapshot of their hand. Every step has been made to make this system as sophisticated and effective as possible.
But there are some real applications beyond its value as a grocery shopping tool for consumers.
How an App like Amazon Go can Help Your Local Store
This tool does something else for business owners: it gives you a massive amount of data. It basically takes digital Analytics offline: Amazon Go watches shoppers constantly (again, in a totally non-creepy, non-Orwellian way; try not to think about it too much), just as internet users are tracked everywhere they go.
Think about what that can tell you as a retailer? Traditionally brick and mortar restocking decisions are made by determining what has been selling and what hasn’t. But with this level of data, you can figure out what consumers looked at; what they changed their minds about; what products were studied; what products were exchanged for other brands; and so on.
But this is only part of the data collected and only part of what you can collect. After all, this type of system knows who the users are, which provides the perfect opportunity for more data collection – and re-engagement. And that doesn’t even touch the potential it provides for better smarter insights and risk management!
For instance, if customer #1 pulled an item off a shelf, but ended up putting it back, a retailer wants to know why. So why not email Customer #1 and ask? All they can do is say no. Even better, SDI’s AI and Deep Learning experts build algorithms that can automate this process; it will notice the potential for more data, pull from a database of stock email templates, and shoot one off to the customer.
With these follow-up emails, you can ask why they decided not to get the returned item; or if they would have purchased it something we’re different about it (ingredients, brand, price, etc). Or you can push engagement by offering a discount on discarded items. Or you can turn the whole thing on its head and figure why Customer #1 bought what they did buy. Positive information is useful too!
Other advantages to this digital solution exist, including a reduction of staffing overhead and automatic restocking based on preset indicators or even predicted needs. But to learn more, you’re going to have to give us a call at 408.802.2885/408.621.8481 – or click to contact us. Don’t worry, it’s a free quote and consultation and we’ll protect your idea with an iron-clad NDA.