Amazon Go’s unique model has been in the headlines repeatedly since the online retailer announced its cashier-less Convenience Stores. Although the stores seem to be doing well, recent data shows that shoppers tend to spend less at Amazon Go locations than they do at other convenience stores.

The Report and Results 

Earnest Research examined the purchases of customers in Seattle, San Francisco, New York, and Chicago. The report indicated that households buy from Amazon Go a minimum of two to five times quarterly. Rite Aid, Walgreen, and CVS have comparable numbers, around three or four times quarterly.

The difference comes from the average amount that shoppers spend on each visit. A typical Amazon Go shopping experience amounts to around $7 to $15 each trip. By contrast, the average amount spent per shopping trip at the other convenience stores mentioned is $20 to $25. This is also a sharp contrast to the amount shoppers typically spend at large grocery stores. Shoppers typically visit Publix and Kroger about 10 times each quarter, spending between $40 and $50 each time.

Plans for Expansion

Amazon does not seem to be dissuaded by these figures as the company recently announced that it will be opening additional Amazon Go stores in Seattle and Chicago. The company has also made a few changes to existing Amazon Go stores, including beginning to accept cash in one of the stores in New York as of May. This was the result of criticism, but it may also help the profitability of the stores. Accepting cash will keep away criticism from regulators and bring in more customers, including the unbanked.

What It Means for Retailers

The fact that the Amazon Go cashier-less stores do not make as much money per visit as other convenience stores can hold a lesson for retailers. Unfortunately, there is not enough data yet to do more than speculate on the causes. Perhaps the presence of cashiers in normal stores slows down the shopping process, giving people more time to make impulse purchases. Alternatively, maybe those who shop at Amazon Go focus on getting in and out of the store since it optimizes efficiency, giving them less browsing time and fewer impulse purchases.

Amazon Go is far from the only retailer with cashier-less stores, or considering the project. Figures from the other stores with similar models could likely help identify whether the cashier-less nature of the store is what leads to the reduced transaction sizes.

Sources:

https://www.retaildive.com/news/shoppers-spend-less-at-amazon-go-than-other-convenience-stores/559508/

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