The Battle of Cashierless Stores: Amazon Go vs. Sam's Club Now vs. Standard Cognition
Table of Contents
- Introduction
- The Impact of Deep Learning on Retail
- The Amazon Effect
- The Rise of Automation in Physical Retail
- Amazon Go: The Future of Retail
- Sam's Club: A Competitor to Amazon Go
- Emerging Startups in Automated Physical Retail
- Standard Cognition: A Serious Competitor to Amazon Go
- The Competitive Landscape of Automated Physical Retail
- Conclusion
The Future of Retail: How Automation is Disrupting the Industry
The retail industry is undergoing a massive transformation, thanks to the disruptive power of deep learning and computer vision. Automation is becoming increasingly prevalent in every sector and level of industry worldwide, and the impact on the consumer market is huge. Retail companies are seeking to leverage and capitalize on every new technological trend, and the stakes to innovate are high. The Amazon effect has only intensified this competition, as the company holds approximately 50% of the US ecommerce market and is now extending its dominance into disrupting physical retail through AI and automation.
The Impact of Deep Learning on Retail
Deep learning is transforming the retail industry in a number of ways. Automation frees up time, and in the Current economy of uber convenience, time is the ultimate asset. This is the real value that automation brings. On December 5th, 2016, Amazon opened its first cashless store to employees only. On January 22nd, 2018, Amazon took its innovations to the next level and unveiled Amazon Go to the public. Since then, the company has opened six stores with three more on the way. An automation can surely make a brick and mortar store intelligent. A truly intelligent store with connected devices becomes a means of data acquisition. A network of intelligent brick-and-mortar stores becomes a vast data acquisition platform.
The Amazon Effect
As Earth's most customer-centric company and one of the largest data acquisition platforms in the world, Amazon understands the value of data-driven insights and decision making. Amazon is able to keep its focus on the customer because it can predict, Based on large data sets, exactly what the customer wants. With the skybridge and the largest volume of automated stores in the US so far, Amazon Go is able to strategically target physical retail. The company's recent acquisition of Whole Foods strengthens its plan, allowing them to sell niche exclusive and proprietary products. In the age of super convenience, Amazon Go can potentially Create everything model their customers want: convenience, personalization, and incredible customer experiences at desired prices.
The Rise of Automation in Physical Retail
How can other physical retailers possibly compete when other retailers are practically throwing their data away? A dozen already had a strategic data plan. The Amazon effect has put several companies out of business and is threatening several more. While the focus for Amazon Go is currently on food and convenience store-Type items, there's no guarantee that will stay this way. Jeff Bezos is relentless. Just checkout relentless.com, it redirects down. As long as I Mentioned before, today's consumers want convenience, personalization, and incredible experiences at desired prices. We Gravitate towards whichever company offers this, whether or not it's Amazon. It just so happens that Amazon is the company that currently does this best, for now.
Amazon Go: The Future of Retail
While Amazon has extensive experience in e-commerce, the game-changer for automation and physical retail is new technologies that are still going through a lot of iterations and developments. This leaves massive opportunities for innovation by existing giants and new entrants. On November 6, Sam's Club opened its first can ago store in Dallas, Texas. Unlike Amazon Go, the store itself isn't exactly automated, that is, it's not exactly using intelligent connected devices or AI. Instead of using a compilation of sensor Fusion, machine learning, and computer vision like Amazon does, the approach at Sam's Club now is a little more hands-on. Shopping at Sam's Club now must use their phones to scan prices as they make their way through the store. Extreme convenience and compared to just walk out technology, scan and go technology seems a little bit of an inconvenience. There's one way higher, less Sense, but can leverage on this one word: gamification.
Sam's Club: A Competitor to Amazon Go
Mobile gaming is a multi-billion dollar industry, and with recent advances in AR (augmented reality) for smartphones, Sam's Club now can turn shopping into the ultimate game. They've already discussed turning shopping into a virtual treasure hunt in their promo video. Imagine if Sam's Club now could build a model like Pokemon Go or geocaching. Shopping could become even more addictive than it already is.
Emerging Startups in Automated Physical Retail
What if You're not Sam's Club, Walmart, or Amazon Go? Luckily, there's an approach here too, and it gives an opportunity for underdogs to take on giants in the game of automated physical retail. There are now hosts of emerging startups that offer complete automation for brick-and-mortar retailers worldwide. Many of these startups already have stores that function as innovation labs. One startup worth singling out is Standard Cognition (SC).
Standard Cognition: A Serious Competitor to Amazon Go
Standard Cognition does things a little bit differently. While many of the other startups use a combination of sensors, computer vision, and machine learning, SC uses almost exclusively computer vision. This is a significant AdVantage. Even compared to Amazon Go, where the Amazon Go needs to use hundreds of cameras working in tandem for just walk out technology, SC only needs around twenty-seven or a star approximately the same size. This makes it easy for SC's future customers to automate their stores. The infrastructure isn't only simple, but it allows for increased flexibility of retail displays. Retail is dynamic, and customers want changing environments. SC's minimally-invasive infrastructure allows customers to rearrange their stores quickly. That's not the only advantage this startup offers.
Standard Cognition is able to identify and keep track of its customers by gait recognition, as opposed to facial recognition. Standard Cognition doesn't store any biometric data. Their customers only have access to general consumer data. This initially doesn't seem like a big difference, but in an era where personal data is a valuable asset that can be used to exploit customers, the implications are huge. Consider the continued impact of the Facebook Cambridge Analytical breach. SC has already attracted a number of clients in the US and has extended its reach into international markets. Standard Cognition just received a $40 million investment from Initialize Capital and today it has raised $51.2 million in capital. With seven co-founders, this startup may be able to Scale really quickly. The startup already has deals with Japan's Delta and PLAs deployed systems to three thousand stores by the 2020 Tokyo Olympics.
The Competitive Landscape of Automated Physical Retail
With these stats, Standard Cognition might be Amazon Go's most serious competitor yet. Or so it might seem. While Amazon Go and Standard Cognition have made the most progress in years, as far as there are many companies rising up worldwide. Israel's StoreDot recently signed a deal to automate 272 locations of a popular Israeli supermarket chain. China's Bingo Box, on the other HAND, is quickly scaling across Asia. Bingo Box already has hundreds of active locations. One thing is certain: the race to automate is extremely competitive. Amazon Go will Continue to innovate. The company plans to open 3,000 stores by 2020. The only way to win is to bring new ideas to market and scale quickly.
Conclusion
The future of retail is bright. Shopping is about to become a much more engaging and valuable experience. Automation is disrupting the industry, and the competitive landscape is changing rapidly. The underdogs and startups have a chance to take on the giants, and the giants are not resting on their laurels. The race to automate is on, and the winners will be those who can bring new ideas to market and scale quickly.