Amazon Go still no go? China has plenty to go, what is the difference?

Amazon Go, the checkout free convenience unveiled in December last year and seized everyone’s attention. Yet it has delayed its public opening date. The reason, according to WSJ, is still working out technical glitches. The Amazon Go uses cameras, sensors and algorithms to watch customers and track what they pick up. However, Amazon has run into problem tracking more than 20 people in the store at one time as well as the difficulty of keeping tabs on an item if it has been removed from a specific spot on the shelf.

China sniffed the trend and tried to follow, again in its own formula. First of all, our mighty Alibaba is beta testing the idea of Taocafe, 200 square meters fully automated convenience stores for the purpose of grocery shopping and casual dining.

Step one: to enter Taocafe, just open the app and scan the QR code

 

Step two: once inside the store, you do not need your phone anymore, just grab anything you want. If you order a meal, it will show your waiting time on the big screen.

Step three: this is where Taocafe is different from Amazon Go; you still need to finish the payment before leaving the store; otherwise the door will not open for you.

In fact, fearful of vandalism, theft, or any possible misbehavior from Chinese customers, fully automated convenience stores in China often require the check-out step combining 24 hours surveillance camera powered by AI facial recognition technology and alarming system. Like this one below (see video demo). Receiving USD15 million led by GGV Capital, a local startup Bingobox already set up a pilot project with Auchan in Shanghai. Although local experts said Bingobox uses RFID to tag all the products in the store and RFID can be expensive at RMB0.5~1 for each product, Bingobox claimed its operation cost is on average USD373 per month, only one-quarter of the cost of running a traditional convenience store.

Some manless convenience store in China maybe more act like a big vending machine shop, like this example below F5, raised around USD4.54 million invested by SinovationVentures. It is said investors have shown greater fervor and are willing to lavish money in this field. More and more startups are popping up every day such as Magic House, or Bianlifeng.

Even traditional convenience store brands Lawson, 7-Eleven are prototyping similar ideas in China now. We shall not be too surprised to see their launch of the unmanned store in the near future soon.

That is why when foreign startup Wheely Moby Mart‘s futuristic store (video demo below) hit the road of Shanghai in June this year, we only feel the arena has been getting a bit crowded.

Though the hype is running high in China, we believe the market penetration still needs more time. If Amazon Go delays its public opening, perhaps our local players also need time to fully test their technical maturity and business model. So far we just see sexy promotional video one after the other.

 

Author: Cecilia Wu