What a difference a year makes. Just last fall I wrote about how retailers needed to rethink how they attract and retain customers. The article highlighted the explosion of the Internet of Things (IoT), and how new devices equipped with sensors that can communicate with each other has enabled retailers to create new, personalized shopping experiences for consumers. While still relevant, this approach was thrown a major curve ball earlier this week in the form of an announcement from Amazon about its Amazon Go store.
As noted in this recent article “With the debut of Amazon.com's Amazon Go, consumers don't have to think about their phones or downloading multiple apps or even picking up a specific brand. By contrast, Amazon's system, which only requires one app download, a smartphone, and an Amazon account, democratizes the playing field and allows consumers to move seamlessly through a store. Er, well, Amazon.com's store.”
The Amazon Go concept reminds me of a discussion I had earlier this fall with Jean-Pierre Lacroix, President of Shikatani Lacroix, a Toronto-based branding and design agency. He spoke to me about how digital has forced organizations to rethink their business models. In one example, he highlighted how Loblaws, a market leader in the supermarket category in Canada has invested in a loyalty program that rewards behaviour. The company is exploring offering consumers the choice to order groceries on their phone and pick them up at a drive through. Ultimately, the goal is to eliminate anxiety and friction points, such as long line ups, for shoppers. Amazon Go takes the elimination of friction points to a whole new level. It will also cause a number of bricks and mortar retailers to speed up the pace at which they; rethinking their own business models.
2017 will be an interesting year for the retail industry. The IoT technologies I highlighted last year will continue to play a leading role and are critical components of how Amazon Go and other retailers will be successful. I believe that we will also see more players like Amazon.com shaking up the bricks and mortar retailers. How will this all play out over 2017? It’s hard to say for sure but I know it’s going to be an exciting year for retailers and consumers!