retail news in context, analysis with attitude

by Kevin Coupe

CNBC has a story, timed to the opening of a 365 by Whole Foods store this week in Brooklyn, New York, saying that the company has 16 more 365 stores in the pipeline.

There are seven open at the moment. The new ones are slated to go into markets that include Arizona, northern and Southern California, Florida, Georgia, Illinois, New Jersey, Ohio, Texas and Virginia.

The 365 stores - about one-third smaller than a typical Whole Foods unit, offering a more curated, private label-focused selection at a somewhat lower price point - are seen as being desirable by real estate developers, especially those that are dealing with empty spaces in hurting malls and strip shopping centers.

But I have a thought about the the coming 365 stores. Or maybe the 17th, depending on where it is.

When the 365 concept was conceived, long before Whole Foods was sold to Amazon, there were three goals cited as a rationale. They were designed to have lower prices, better technology, and greater appeal to young people, especially millennials, who find the charms of a traditional 365 store somewhat wanting. The prices struck me as only marginally lower, the tech was nothing to email home about, and based on discussions I’ve had with people younger than I, the millennial appeal was negligent.

The schedule of to-be-opened 365 stores suggests that Amazon remains committed to the format, which I think makes sense … in only because 365 can serve as an interesting laboratory in which Amazon can test new marketing, merchandising, technology, product and service ideas before transplanting the successful ones to its bigger, more traditional stores.

Which leads me to my idea.

I think that in one of these new 365 stores, Amazon ought to test the use of Amazon Go checkout-free technology.

The stores aren’t that big, so it may be more doable. There are no service departments, and with a small adjustment to some of the self-serve fresh food sections, I would imagine that it would be possible to make the Just Walk Out technology work. Plus, it would be a huge leap forward technologically, would be an enormous draw for younger shoppers.

Now, to be clear, I have no inside knowledge. Amazon has said it is focused right now on the single Amazon Go store now operating in Seattle. So all I’m doing here is speculating, and people smarter than I probably could poke holes in my logic.

But I think I may be onto something here. I have no idea what the timing would be, but it certainly could and would be an Eye-Opener.
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