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Bill Lewis

Employment shift: who will "go" with Amazon Go?

BY BILL LEWIS

I would contend that in the context of retail, the aptly named store in Seattle, Amazon Go, means “Go,” not just for the customer but for thousands of people employed in the retail industry. Singapore will not be immune.

It has been held that in recent years, Singapore has become “over-malled”, certainly in comparison to other major Asia cities and further afield. It has also been reported that Singapore’s retail establishments are arguably amongst the least productive. Has a flood of low cost labor willing to work long hours for low wages and a complicit immigration policy brought in lower skilled labor from other Asian countries and China to support an expanding and manually intensive retail and service environment? This sounds like too many stores with too many staff. Not only is this not sustainable, other looming threats put Singapore’s retail sector, including retail property, into one of the least attractive investment opportunities at a time when smart money has moved away.

While Singaporean consumers and social media pundits have had an outpouring of grief over the launch of Amazon Prime in the past week, the grief will pass. Amazon will get its act together. Amazon, along with Lazada and Red Mart, will accelerate high digit growth in online shopping. In the economic microcosm that is the city-state, the unrelenting drive to online and on-demand satisfaction of a wide range of basic and luxury needs will continue unabated. The USA experience of online retail’s growth rate dwarfing that of the industry at large will be replicated here, evidenced by the fact that consumers in Singapore are among the world’s fastest adopters of mobile shopping despite the relatively young e-commerce industry.

Having wreaked havoc in the conventional retail environment, Amazon might just go further and be responsible for the transformation of not just the online market, but of every aspect of the buying experience from the Heartlands to District 11.

Recent developments thousands of miles away may sound the death knell for Singapore as we know it today. In the next five years this “Orchard Road Extravagance” could come crashing down with challenging consequences for employment, immigration, retail developers, and city planners.

The Amazon Go concept store was launched in Seattle six months ago and similar stores from Amazon will receive the public later this year. Their concept is simple. You walk into the store, swipe your phone, start shopping, and—once you are complete—walk out. Zero delay, zero interaction at check out; check out in the conventional sense does not exist.

Amazon Go is “a new kind of store with no checkout required," therefore no lines and virtually no need for human interaction—basically an almost completely autonomous shopping experience. Branded as "Just Walk Out Shopping," it promises an easy way to shop. Amazon has cohesively blended its e-Commerce platform into a physical setting. But they needed some seriously complex and sophisticated technology to do it. Using Sensor Fusion, Deep Learning Algorithms, and Computer Vision, Amazon knows who you are, your buying habits, when you pick an item from the shelf (and put it back), your preference for ketchup or mustard, and as you move through your shopping experience, it is tallying up your purchases, which are charged directly to your Amazon account as you walk through the exit door.

I hear the naysayers, “Yes, but it will not happen here. No one will spend the money to develop such technology.” 

Sure, it can be argued that the cost of developing Shop and Go technology is out of reach for all except the extremely wealthy and talented organizations. After all, it has taken Amazon four or five years to get to a real store that works. And many other mighty retail organizations have failed, or have taken a strategic misstep in trying to make the check out process more effective and not remove it altogether.

But there is a big “what if” in the room. Amazon Web Services (AWS) is the biggest cloud infrastructure business in the world, holding 43% of the global infrastructure market. But AWS is not just about server capacity. Looking at the AWS website, there are over a hundred apps and solutions available for businesses to deploy—the ultimate cloud service provider.

What if Amazon decided to monetize its investment in “Shop and Go” technology and made a suite of applications and services available on AWS?

The brighter retailers on Orchard Road, or the supermarkets in Novena, or Changi’s massive retail complexes could be transformed overnight. Not only would the shopping experience change but thousands of employees would have to “Go” too.

Never say never…..

The views expressed in this column are the author's own and do not necessarily reflect this publication's view, and this article is not edited by Singapore Business Review. The author was not remunerated for this article.

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Bill Lewis

Bill Lewis

Bill Lewis is a co-founder of Temasys Communications. He is also a writer, speaker, entrepreneur, mentor, and motivator, who helps transform businesses and people. Bill is an experienced corporate executive, non exec director, and a serial entrepreneur. He is an author for the best-selling books Midas and 1000 Cows, and 100 Mistakes of a Start Up CEO. He is rated as an outstanding leader and a seasoned high-level performer. He has served on the boards of five companies, including the global board of a major system integrator. He has also led major businesses in Fortune 200 companies, and was the CIO at one of the world's largest aircraft maintenance organizations. He is a consummate influencer and decision-maker at board level.

Bill is very passionate in the digital future. He takes so much interest on how technology is changing our lives not only today but also tomorrow. Bill cares for technologies’ impacts in the business world. The other area he is passionate on is entrepreneurship, as in how to succeed in business.

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