Over the past year, Amazon\u2019s stock price has escalated by about 65%, establishing the company\u2019s absolute dominance in the ecommerce industry.\u00a0 Its business practices have proven to be detriments to traditional brick and mortar corporations.\u00a0 Many of these conventional retail companies are then forced to either adapt to this new online trend or face failure and bankruptcy.\u00a0 Millions of Americans are subscribed to Amazon\u2019s prime services, furthering the companies recognized revenues.\u00a0 Even more consumers have personal Amazon accounts and routinely purchase goods and use the ecommerce giant\u2019s services.<\/p>\n
Even with this established success and power, Jeff Bezos and Amazon continue to innovate and introduce new strategies to win more customers and accelerate the involvement of both millennials and baby boomers.\u00a0 Recently, the company opened its first \u201cAmazon Go\u201d store.\u00a0 This new data driven concept uses artificial intelligence to do without a typical brick and mortar checkout line and collects data on consumer tendencies in hopes of bettering its business.\u00a0 As brick and mortar stores are on the decline, this tactic provides a very interesting approach to retail in the technology centered modern landscape.<\/p>\n
Within the Amazon Go store, consumers sign in to their Amazon accounts on their phones and are tracked throughout the building.\u00a0 Artificial intelligence makes note of how the customers walk around, if they pick up a product and place it back down, and the speed of their decisions.\u00a0 As customers head out the door, there are no cashiers to check out with, just a sensor that reads what products are bagged.\u00a0 This strategy finds a happy medium between physical shopping and ecommerce by allowing customers to see products but also \u201cdo away with the most inconvenient part of the convenience store experience: waiting in the checkout line.\u201d\u00a0 In this beginning stage, this robot oriented approach is certain to experience some conflict.\u00a0 To combat this possibility, a handful of employees are stationed around the store at the customer\u2019s aid.<\/p>\n
Amazon continues to pioneer the retail industry.\u00a0 Moving from solely selling books, to universal consumer goods, and now opening a brick and mortar store with its own twist, the company achieves a significant competitive advantage over other retailers. Brick and mortar retailers overall have experienced depressed revenues due to this \u201cAmazon Effect\u201d.\u00a0 With the introduction of the Amazon Go strategy, these same retailers face another competitive challenge caused by Amazon.\u00a0 It will be interesting to see whether these retailers such as Target and Walmart will adapt and utilize a similar high-tech approach in their stores or maintain their current strategies.<\/p>\n
Furthermore, Amazon recently acquired Whole Foods and hopes to refine the grocery\u2019s stores business to realize even more revenues.\u00a0 This Amazon Go store strategy could potentially be used in Whole Foods markets.\u00a0 Customers would be able to physically see the fresh produce they are buying, benefit from lower prices of high quality food, and also enjoy a feasible checkout system.\u00a0 Additionally, AI would accumulate massive amounts of data to help better the grocery shopping process.\u00a0 It will be fascinating to see how other grocery chains react if Amazon implements this tactic.\u00a0 Could the \u201cAmazon Effect\u201d not only hinder traditional retail companies but also prove to be a threat to grocery stores nationwide?<\/p>\n
<\/p>\n