The Future of Retail: Entrepreneurship and Innovation at Amazon Go

This report examines Amazon's innovative venture, Amazon Go, focusing on its disruptive impact on the retail industry. The analysis begins with an overview of Amazon's investment in research and development, highlighting its commitment to consumer-centric innovation. The report then delves into the concept of Amazon Go, a cashless store utilizing AI, computer vision, and 'just walk out' technology to streamline the shopping experience. It discusses the potential for Amazon to open thousands of these stores, challenging traditional convenience stores. The report further explores how innovation benefits consumers, differentiating between social, economic, and technical innovations, and then assesses the customer acceptance of the Amazon Go model. The analysis includes references to relevant articles and academic research, offering a comprehensive understanding of Amazon Go's strategic approach and its implications for the future of retail. The report highlights the challenges associated with the expansion and the competitive advantages of Amazon's innovation strategy.

Running head: ENTREPRENEURSHIP AND INNOVATION
ENTREPRENEURSHIP AND INNOVATION
Name of the Student
Name of the University
Author note

2ENTREPRENEURSHIP AND INNOVATION
Task 2:
As the context of the assignment is based on Innovation, one of the recent innovations by
the e-commerce giant Amazon Inc will be discussed based on the article published in Bloomberg
(refer to the reference list for the link of the article). This article focuses on the number of
cashless stores that the management of Amazon claim to open by 2021 (Soper, 2018). Amazon is
an organisation that is based on innovation; the company has set a record of investing the largest
sum of money in research and development department. Amazon has a plethora of services and
products which are all benchmarking in their own category. The company has gathered the
attention of the customers as well as other stakeholders along with media when they had
announced the “future of retail” with unveiling the concept of Amazon Go. This plan of going
cashless in the physical retail industry is like a disruptive innovation. An innovation is said to be
disruptive when it challenges the established concept or idea (Christensen et al., 2015). Amazon
Go is claimed by the company to be the most advanced shopping experience, where the
customers can walk in to the store, pick up the required goods and just walk out. This will minus
queuing up for bill payments, having cash ready etc. The company has used AI, computer vision
and other technologies to enable the customers to not waste time for billing etc.
The CEO of Amazon has established that the company is consumer based organisation
and the company focuses on the needs and requirements of the customers in order to develop the
products. Innovation being the most important part of the delivery process in providing the
customers with their requirements. Computer visions, deep learning algorithms, sensor fusions
and “just walk out technology” to develop this service (Amazon.com., 2018). With the help of
the Amazon Go mobile Application the billing is virtually made and the individual is charged

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without even waiting to pay or bill. The first store is located in Seattle near the Amazon
headquarters. The store has grocery items along with prepared foods. They also have a selection
of alcoholic beverages like beer and wine (Amazon.com., 2018).
The company is now set to open 3000 Amazon Go stores which is highly likely to
threaten the established convenience and mom-and-pop stores like 7-Eleven Inc, Subway and
Panera Bread etc. The focus is on reinventing the physical retail experience and according to the
CEO Jeff Bezos this can be achieved by eliminating meal-time logjams (Soper, 2018).
This visionary and futuristic approach to the retail industry is lucrative and exciting yet
has a number of challenges for the company as well. Firstly the expense associated with opening
each store is high. Even though the capability and resource of Amazon is promising, it will be a
challenge for the company to reach the target of 3000 by 2021 (Soper, 2018). The hardware
installation in the original store costed the company more than $1 million (Soper, 2018). This is
just one of the many expenses of establishing the cashless store. Also the company is not yet sure
about the format of the store.
However ambitious the target of the company maybe form the innovation perspective it is
about to set some high standards for the established brands (Tidd & Bessant, 2014). The
announcement of the potential of Amazon had lowered the share rates of the competitors in the
market, therefore establishing that innovation is the competitive strategy that Amazon Inc
employees.

4ENTREPRENEURSHIP AND INNOVATION
Task 3:
How innovation helps the consumer?
Answer: Innovation can be divided in the three parts- social, economic and technical
innovations. The social innovation provides social benefits to the customer. Innovation helps the
consumer to get better and advanced products. For example in earlier days people used the
landlines which cannot be taken to any places but then cell phone was invented. The cell phones
are portable and have more features than the landlines (West & Bogers, 2014).
Do you think the concept of Amazon Go will be accepted by customers?
Answer: The customers have accepted the advancement of retail sector by popularising the e-
commerce segment. The success of the concept of e-commence have led the companies like
Amazon to believe that customers are ready to accept and use technology aligned with their
shopping experience. The government of the countries are also providing the people with
required infrastructure to support the technology that is being developed for mass consumption.
Jeff Bezos is a visionary and transformational leader, he believes in change and believes that
with change company can develop and the society and improve (Amazon.com, 2018). Thus,
innovation is an important part of the business model of Amazon Inc. The first store in Seattle is
successful as people are both curious and are astounded with the service.

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References:
Amazon.com. (2018). Amazon.com: : Amazon Go. Retrieved from https://www.amazon.com/b?
ie=UTF8&node=16008589011
Christensen, C. M., Raynor, M. E., & McDonald, R. (2015). What is disruptive
innovation. Harvard Business Review, 93(12), 44-53.
Soper, S. (2018). Amazon Will Consider Opening Up to 3,000 Cashierless Stores by 2021.
Retrieved from https://www.bloomberg.com/news/articles/2018-09-19/amazon-is-said-
to-plan-up-to-3-000-cashierless-stores-by-2021
Tidd, J., & Bessant, J. (2014). Strategic innovation management. John Wiley & Sons.
West, J., & Bogers, M. (2014). Leveraging external sources of innovation: a review of research
on open innovation. Journal of Product Innovation Management, 31(4), 814-831.