retail news in context, analysis with attitude

Reuters reports this morning that Amazon is starting  anew business that will license its checkout-free "just walk out" technology to other retailers, and today will launch a new website designed to promote it.

The story says that Amazon is saying that it already has signed several deals with customers that it is not yet willing to publicly identify.

As with Amazon Go stores, consumers will be able to take products off store shelves, put them in bags or even their pockets, and then be accurately charged after they leave the store.  Unlike with Amazon Go stores, they will not need a mobile application to enter stores, but rather will just use a credit card to gain entry; that card will then be charged when they depart.

Retailers licensing the technology will do so using their own banners;  they will not be able to open Amazon Go-branded stores.

The JustWalkOut website provides the following information:

•  "The installation of the technology can take as little as a few weeks from the time we have access to your store. For new store builds, we work with retailers as part of your construction or re-model plans. For existing stores, we work with retailers to install the technology while minimizing impact on current operations."

•  "Our technology has broad applicability. It's great in places that have high demand, long lines, or wherever customers are pressed for time. The ability to quickly enter, grab what you want, and just walk out without stopping to check out is very appealing to customers."

•  "We only collect the data needed to provide shoppers with an accurate receipt. Shoppers can think of this as similar to typical security camera footage."

Reuters writes that "a by-product of demand for the offering would be increased usage of Amazon Web Services, the company’s cloud that underpins its checkout-free systems.

"Still, high demand is by no means certain. Other vendors including Grabango and AiFi are offering automated checkout to retailers, which in the past have been loath to hand deals to their rival Amazon that has been the biggest disruptor of their brick-and-mortar businesses."

However, there have been reports that airport shops are one retail segment for which Amazon Go-type tech would be ideal.

KC's View:
One issue that ought to be on people's minds is who will own the shopper data.  Amazon says that it only will use the shopper identification and credit card data for purposes of being able to charge the customer, but if I were licensing the technology, I'd want to make damned sure that this is guaranteed contractually.

That said, I think this is a very big deal with enormous implications for retailing;  I have been saying since the first time I saw Amazon Go that I believe that checkout-free tech eventually will be as important to retail development as scanning.  Sure, there are other companies developing different checkout-free systems, but Amazon certainly is way ahead of the game because it has fully functioning stores of varying sizes that are using it successfully, and has said with the opening of its new Amazon Go Grocery in Seattle that size is no longer an issue for the checkout-free concept.

Cost will be an issue, of course, but I have to believe that Amazon's tech will not be out of reach for most retailers, and will be structured, especially in view of reduced labor expenses, so that a range of companies can afford it.

The next shoe to drop will be when Amazon starts naming names of its customers, and creates a very specific kind of momentum.