The retail giant Amazon looks to broaden its services by constructing their first brick and mortar grocery stores. Traditionally, Amazon centered its grocery store strategy on Amazon Fresh, a subscription service that promises quick food delivery for online orders. According to Kantar Retail, online purchases comprise about 1% of the $674 billion market for edible groceries in the United States. Due to the minuscule amount of online grocery purchases and the complexities of delivery logistics, Amazon envisions opening more than 2,000 stores in the upcoming years.
Amazon unveiled three brick and mortar formats to compete in an area of shopping that remains mainly in-store. These formats range from small to large multi-function stores with curbside pickup capabilities. The first concept, at roughly 1,800 square feet, features artificial intelligence-powered technology that allows customers to scan their phones at a kiosk as they walk in and will automatically determine which items customers take from the shelves. The second concept features three covered bays for cars to pull up and pick up orders. The third and final concept is a 30,000 – 40,000 square foot multi-format store, combining in-store shopping with curbside pickups. This concept is likely to resemble European discount grocery chains Aldi and Lidl. Amazon’s strategy aims to drive consumers to their stores and increase their dominance in the retail market.
Written by Front Street Intern Trent Slattery.