Shopper Marketing - January 2017 - 41
checkout-free Amazon Go store - means the
traditional retail model is still viable. On the
other hand, Amazon's grocery realm raid is forcing CPGs and retailers into an evolve-or-perish
situation, even if they are slow to recognize it.
Online grocery purchases make up a scant 2%
of U.S. grocery sales, but forward-looking CPGs
and retailers are nevertheless keeping a watchful eye on e-commerce in general and Amazon
in particular, investing in ways to either partner
with or compete against the goliath - or both.
Amazon Gets Physical
From a retailer perspective, Amazon has come
out swinging in the new year. Amazon Go was
just the first jab. In a move that would threaten them but provide CPGs with a new channel, Amazon plans to build physical locations
where shoppers can buy perishables such as
produce, milk and meat with the option of or-
dering unstocked pantry items for same-day
home delivery using mobile phones or in-store
touchscreens. Drive-in locations where online
grocery orders will be brought to the car are
also said to be in the works.
It's unclear whether all new stores will be
equipped with the technology that enables
Amazon Go's scan-and-leave customer experience, which eliminates long lines, barcode
scanning and other hassles retailers have long
tried to address. Should this concept succeed
where self-checkout, mobile pay and even Amazon's branded Dash buttons have fallen short
or failed, the technology could be licensed to
other grocers, which may be Amazon's longterm aim.
Amazon's brick-and-mortar initiative builds
on the steady rollout of Amazon's Fresh, Pantry and Prime Now services, respectively offering same-day or next-day delivery of fresh
What impact will Amazon.com's private
labels have in the CPG space?
Definite game changer
It won't be a
Source: Path to Purchase Institute/Shopper Marketing magazine
Note: For complete Trends 2017 coverage, see page 46.
JANUARY 2017 SHOPPER MARKETING