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Amazon Opens Tech-Enabled Grocery Store in California

The store concept brings the company’s artificial intelligence assistant, Alexa, right to the aisles. And, if customers prefer, they can run-in/run-out without ever going through a traditional checkout.

by Ryan Carter, Daily News / September 17, 2020
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(TNS) — Alexa is going to be busy Thursday on the west end of the San Fernando Valley.

That’s because the first Amazon Fresh grocery store opens in Woodland Hills.

Long in the making, the store’s debut at the former site of the Toys “R” Us on Topanga Canyon Boulevard ushers in a new brick-and-mortar chapter for the e-commerce giant.

Amazon officials tout the store as highly convenient with decent prices (like 15-cent bananas) and new tech-driven forms of in-store shopping.

The concept brings the company’s artificial intelligence assistant, Alexa, right to the aisles. And, if customers prefer, they can run-in-run-out without ever going through a traditional checkout. Or, in a nod to the COVID-19 era, they can stick with online shopping and pick up the goods at the store.

“There’s a lot that goes into a grocery store, and we’re quite excited about this one,” said Jeff Helbling, vice president of Amazon Fresh Stores.

CART OR DASH CART?

Woodland Hills will be the first to get a taste of food shopping with the Amazon Dash Cart, a tech-laden grocery cart enabling shoppers to use Alexa to manage shopping lists and navigate aisles, then skipping the checkout lane.

The cart uses a series of inward-facing cameras and a combination of computer algorithms and sensors to track what goes in or out of the basket. It’s like that little “cart” icon on the Amazon website or app. Only now it’s real life.

If shoppers can’t find the Cheerios, Alexa is just a prompt away. Reach out to her and she’ll get you going in the right direction, Helbling said.

When shoppers are done, they’ll run the smart cart through a designated aisle on the way out. While in the Dash Cart lane, payment is completed automatically after users log in using a Fresh QR code on their smartphones.

If shoppers aren’t hip to the tech or Amazon Prime customers, they can go old-school and use a traditional cart and cashier.

“It will be a very fast, convenient shopping experience,” said Burt P. Flickinger III, managing director of the New York-based Strategic Resource Group, which has studied Amazon, Whole Foods and the retail industry for decades.

Flickinger noted that Amazon’s technology infrastructure, particularly the ability to process consumer payments, will “invigorate” the market and make the store a destination.

“It’s the proverbial Star Wars store,” he said. “It’s exciting. It’s state of the art. It’s fast, efficient. It’s fun.”

BUSY AREA

The store — which opened late last month serving invited customers to get early feedback — employs roughly 200 people.

Sister stores will follow in North Hollywood, Northridge and Irvine. Outside of Southern California, three stores are planned for the Illinois suburbs. All of those stores have yet to open to regular everyday foot traffic. But, like Woodland Hills, they are suburbs, not far from metro areas like Downtown L.A. or Chicago.

Helbling declined to elaborate on further growth plans but said Amazon is “hopeful” the model will resonate in those markets.

They are markets that likely have something else in common: tech-savvy consumers and a high concentration of budding young families, analysts suggest.

The Woodland Hills store opens in a shopping plaza that is part of a rapidly developing section of L.A. — Warner Center, complete with higher-end multi-unit residential dwellings and nearby commercial hubs such as Westfield Topanga and The Village.

Officials confirmed in November that a new store was coming, after months of speculation.

At the time, Amazon was beginning to publish job openings for the West San Fernando Valley location. The starting pay rate varied from $15.35 to $16.90 per hour. It took some time for the gray facade with bright green trim to get its sign. The store, in the shade of a new residential complex, is neighbors with See’s Candy.

Amazon Fresh is the latest step into the grocery world the Seattle company has taken since its $13.7 billion acquisition of Whole Foods Market in 2017.

The move won’t rock the boat for big-name competitors, but it will help push the grocery industry further into the 21st century.

“For the high value, low-price leaders, where it’s important for shoppers to save, there’s no worry for Aldi, no worry for Trader Joe’s or Costco or Kroger or WinCo. They’ll all still generate record-breaking sales results,” Flickinger said. “But what it does do is geometrically increase the technological breakthroughs and initiatives to make shopping easier and more convenient, where competitors will be mirroring and building on Amazon initiatives.”

The emergence of the Fresh stores also represents a new direction for Whole Foods, which has pulled back on its failed Whole Foods 365 initiative, Flickinger said.

The new store isn’t far from a busy Whole Foods at the corner of Ventura Boulevard and Topanga.

Each store serves its own market niches, Helbling said.

“They serve two different customer needs and occasions, and we’re investing in growing both of them,” he said. “We think they co-exist nicely throughout the city.”

The new store adheres to physical distancing directives and will be operating at 50% capacity.

©2020 the Daily News, Distributed by Tribune Content Agency, LLC.

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