Amazon Just Walks Out: why it matters to the meat industry

In 2018, Amazon quietly began piloting a new store format, Amazon Go. The premise was this: a shopper walks into the store, scans their Amazon Go app to be allowed through the turnstile, selects items off store shelves, and then walks out of the store. Seconds later, the shopper receives an email with receipt. That’s it. 

The shopper just walks out.

How? According to The Verge, “Amazon Go stores use overhead cameras and computer vision technology to track both shoppers and items throughout the store. That way, the system can identify when a specific person has picked something off the shelf and placed it in their cart, and even when they decided to put something back.”

Two recent announcements should catch the attention of meat processors of all stripes:

  1. Amazon is now expanding the use of the technology into a larger grocery format at their new Go Grocery store in Seattle.
  2. More importantly, Amazon is now licensing the technology to other retailers. And branding the technology, cleverly, as Just Walk Out.

According to the Wall Street Journal, “Amazon hopes the grocery store will serve as a showcase for its technology as it seeks to sell its system to other businesses. The company has recently been in talks with potential partners and is targeting retail options including convenience stores and shops in airports and sports arenas, according to people familiar with the matter. Amazon has discussed multiple revenue models, including a fixed licensing fee or a revenue-sharing agreement, one of the people said.”

How will this impact the meat case, and more broadly the animal protein supply chain? 

Here are the 3 reasons I believe this creates an inflection point in the retail value chain:

  1. Puts the consumer experience on the consumer’s termsIt lets them talk with a store employee when they want to do so, not because they have to in order to make the purchase. As consumers – all of us – continue down the path of customization options to buy when we want, how we want, and what we want, this is a big step in that direction for food retail. And on a related note, I expect this to dial up consumer expectations for the retail experience. How long will it be before checking out with an actual cashier will feel like stepping into 1950? 
  2.  Frees up labor to increase service level / create opportunities for a new consumer experience at the meat case. How will retailers reassign labor and take advantage of a way to improve the experience as consumers shop for one of their biggest ticket items in a grocery store? How will packers equip retail partners to do this well?
  3. Enables an Amazon driven value chain, e.g. a data driven value chain. Today, all packers get is sales data – what moved at retail and how much. Imagine Amazon/retail partners being able to report back to packers the average amount of time a consumer spent looking at one item vs another and how that correlated with purchases. Or how many times consumers picked up one packaging type vs another, and how that correlated with purchases. Imagine all the ways this increasingly granular view into shopper behavior could drive relevant data to packers to drive everything from packaging decisions to new product development? 

A parallel example is Lemonade Insurance vs Every-100-Plus-Year-Old-Insurance. Insurance companies are set up to sell policies through a distribution network of agents, so the data that flows back to insurance companies only comes from shoppers who submit information to get a policy, or actually buy a policy. All the micro-behaviors in the middle of that buying process are lost because there is no mechanism to capture data for traditional insurance companies. 

But that’s not true for Lemonade Insurance, a startup with a buying experience that is digital first. Because Lemonade engineered an online buying process, they are capturing an enormous amount of data about micro-behaviors in the buying process such as, at what point do most shoppers drop out of the buying process. That’s incredibly valuable information to inform either product development OR engineering of the buying process itself. 

I see Just Walk Out as a technology that will enable retailers and their packer suppliers to move from making blindfolded decisions with end result data on sales only, to being able to operate like Lemonade Insurance with an eye opening new level of data granularity to drive better consumer outcomes – either in the product itself or how its sold. 

….this will be an industry defining inflection point. Who’s poised to take advantage of it?

One thought on “Amazon Just Walks Out: why it matters to the meat industry

  1. They’ve always said, it’s about the journey not the destination. They might actually learn about the consumers journey to t-bone vs New York or pork chop…

    Also, I’ll be the lady shouting at the camera on my way out: I already paid for this!!

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