Once considered the future of retail, the mainstay"Just Walk Out"Black technologyAmazon Go cashierless storeUltimately, it couldn't withstand the pressure of real-world costs. Amazon was shocked.AnnounceThe company will close all of its Amazon Go convenience stores and Amazon Fresh supermarket locations.
However, this does not mean that Amazon is abandoning its physical retail business. Instead, it is refocusing its resources on the acquired Whole Foods Market and a more ambitious new "Supercenter" plan.
The "grab and go" model is popular but not commercially successful; its economic model is difficult to scale.
Amazon admitted in its official blog that while it saw encouraging signs in its branded physical stores, it has consistently failed to create a truly unique and scalable customer experience. Simply put, no matter how cool the technology is, if the profit model doesn't work, the expansion of stores isn't as effective as expected.
Existing Amazon Fresh and Amazon Go stores will be closing down, while some locations will be converted into Whole Foods Markets. Amazon emphasizes that affected employees will receive internal transfer assistance.
Future Strategy 1: Go all out to expand into Whole Foods and express delivery.
By closing its own branded physical stores, Amazon is now betting on the already profitable Whole Foods Market. The company plans to open over 100 new Whole Foods Markets in the coming years, demonstrating that Amazon recognizes consumers' demand for "fresh groceries" still leans towards traditional, quality-assured brands, rather than cold, technologically advanced experimental stores.
At the same time, Amazon is also focusing its efforts on online services, especially its newly launched "Amazon Now" 30-minute express delivery service, attempting to directly compete with services such as DoorDash and Instacart in the instant delivery arena.
Future Strategy Two: Create an Amazon version of "Walmart"?
Most notably, Amazon revealed that it is developing a brand new physical store concept – “Supercenter”.
While official details are still limited, the description mentions that these stores will offer a "wide selection of goods," including fresh groceries, household items, and general merchandise. Sound familiar? That's right, it's essentially Amazon's version of Walmart or Target, attracting consumers to "one-stop shopping" through a large-scale supermarket format.
Where did the Just Walk Out technology go?
As for the Just Walk Out technology that once amazed everyone, it won't disappear. Amazon stated that the technology is currently working well in third-party venues (such as vending machines in airports and stadiums), and will continue to collaborate with external partners in the future through "technology licensing".
Furthermore, this technology has been widely deployed in the break rooms of Amazon's own warehouses, allowing employees to buy meals and drinks without having to wait in line. While the official explanation is to "maximize employee rest time," it inevitably raises questions about whether this is another form of employee surveillance.
Analysis of viewpoints
Amazon's recent "decluttering" is not surprising. While Amazon Go amazed the world when it launched in 2018, the high cost of sensor deployment, maintenance difficulties, and the fact that consumers' novelty towards "unmanned stores" wore off, returning to the essential question of "how convenient and cheap it is to buy things," meant that Amazon Go clearly failed to beat traditional convenience stores on these fundamentals.
This shift signals that Amazon is finally acknowledging that "the essence of retail is still retail, not technology."
Instead of pushing its own Amazon Fresh brand, built from scratch, Amazon would leverage Whole Foods' existing customer base to expand its market. Instead of launching niche Amazon Go cashierless convenience stores, it would be better to build a Supercenter that sells everything to compete with large-scale supermarkets like Walmart. While this may lack some of the romanticism of a tech giant, it's undoubtedly a more pragmatic business decision.
For consumers, Amazon's physical stores in the future may become "very ordinary," like regular supermarkets or hypermarkets, but perhaps that's what we really need.
