How Amazon Go unlocked a new era of next-gen payments

How Amazon Go unlocked a new era of next-gen payments

There has been a lot of buzz surrounding Amazon Go ever since the first checkout-free store opened its doors in Seattle in 2016. Recently, the retail giant announced that it will be rolling out the concept internationally, and it is already setting the tone of what payments will look like in the future. Last year, off the back of an Amazon partnership announcement, Zip Money’s share price lifted by 24.1 percent.

When we think about the Amazon Go model, there are many game changing aspects: the ability to completely avoid queues, the unique sensation of walking out of a store “without paying”, and the sophisticated technology that invisibly calculates transactions. But is this really the future we are headed towards?

While it captivates us as the “store of tomorrow”, Amazon Go is not without its challenges. For one, the technology alone in an Amazon Go store is reported to cost US$1 million. The concept is certainly visionary, but the array of cameras, sensors, machine tracking and other systems involved simply cost too much to be economically feasible for many merchants.

Despite this, the model has disrupted the status quo, and new shopping experiences are proliferating – the future of in-store shopping is a lot closer to our own retailers than we may think.

Retail’s high-tech shopping alternatives

Innovation isn’t new to retail. Seventeen years ago, Waitrose – a high-end supermarket chain in the UK – pioneered the self-checkout concept to wide success. This experience is now common practice here in Australia as well. Indeed, when innovation disrupts the market, even if not adopted wholesale, it can be a boon for small-step evolutions in our everyday experiences. Many retailers are already deploying new shopping experiences that would have been unimaginable even 10 years ago.

In Australia for example, order-ahead coffee apps like Hey You, Beat the Q, Posse and eCoffee Card are a standard part of our morning ritual. Even KFC opened a drive-thru-only restaurant in Newcastle with a clever order-ahead app to serve Aussie customers in record time. Innovation in shopping doesn’t stop there, just look at Dulux’s Paint Colour Visualiser app. Dulux uses virtual reality technology to help consumers take the guesswork out of picking colours by uploading photos of their houses and “painting” the walls virtually before committing to a colour.

Gaining speed and experience through Scan&Go Apps

Perhaps the evolutionary stepping stone between self-scan checkouts and just-walk-out technology in Amazon Go stores is already here with Scan&Go apps. These apps allow shoppers to scan and pay for items using their smartphone without ever having to queue up or go through a traditional checkout experience.

Australian supermarket giant Woolworths offers Scan&Go as a payment method for customers. The service is available to customers in six key Woolworth stores around Sydney, with two more stores scheduled to roll out the technology soon. To use the app, shoppers simply scan items using the Scan&Go app, track their balance as they go and pay in-app using banking details rather than at a store checkout. Thanks to the Scan&Go innovations, Woolies is now working towards opening its first single aisle,

completely cashless store.

Solutions like these are viewed by many retailers as more realistic and cost effective than the more costly, tech-heavy approach of Amazon Go shops. However, the Scan&Go shopping experience is not one-size-fits-all. Other industries such as fashion require RFID tags to be deactivated by a cashier at the point of sale.

The future of Aussie payments

The alternatives to Amazon Go are already here – and you may be already using them – but as the technology becomes more affordable, and as consumer demands continue to evolve, we can expect to see further innovation. Technologies like augmented reality are likely to become more commonplace in app-based shopping experiences, where consumers can test-drive products at home, further blurring the distinction between the IRL (in-real-life) and the URL (online).

Biometrics will also play a greater role in the payments ecosystem. In addition to the now commonplace fingerprint, voice and facial recognition, some companies are working on biometric-triggered embeddables, injectables or ingestibles.

Amazon Go may be a visionary concept, but it remains to be seen whether the perceived benefits outweigh the associated upfront costs to get more retailers on board. Until then, there are still a wide range of innovative, cost-effective solutions designed to add speed, convenience and create a frictionless experience for customers. If nothing else, Amazon Go has altered our expectations of what is possible, and we’re already seeing a whole new world of shopping taking flight.

Phil Pomford is head of APAC Worldpay Merchant Solutions, FIS.


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