The rise of Amazon and other e-commerce companies has lead to a decline in traditional brick and mortar companies. Walmart has even changed many parts of its business and has increasingly started focusing on its online business in spite of the fact that it rose to dominance with its warehouse-like retail locations. However, we are seeing tech giants around the world start re-embracing brick and mortar retail with their own Silicon Valley twist. For example, in the United States we have seen Amazon introduce their Amazon Go stores, where consumers just walk into the store, grab what they need, and walk out. No register is involved in the process and the consumer’s balance is just added to their Amazon account and taken out of their credit card.
Across the world, China has seen a rise in these marriages between e-commerce and traditional retail as well. In fact, it can be argued that China is 2 or 3 years ahead of the United States in bringing e-commerce to tradition retail. Alibaba – Amazon’s Chinese counterpart – operates a Chinese grocery store called Hema which allows consumers to engage with the food they are buying, giving them the capability to scan food items to get information on it like recipes that include the item, or when the item was shipped to the grocery store. We also have seen an emergence of robot-restaurants that deliver food to tables using robots rather than servers.
The reemergence of traditional retail with an e-commerce twist is an exciting turn of events with a lot to offer. It will be interesting to see how this business model grows in the US. In China, there have been questions about the quality of the food in these places. Is this an issue that will arise in the US as well, or do our consumers have enough safeguards in place to assure this does not happen? I personally would be excited to see an Amazon Go, or a grocery store similar to Hema, start operations here in Philadelphia, and think it is a great way of engaging with your consumer during the shopping experience. As a business idea, it gives them a significant edge over their competition.