Starbucks has partnered up with Amazon to pioneer a new kind of store that allows customers to buy food, drink and other products without having to pay at a cashier. The store has just opened in New York and there are plans for two more joint stores between the two brands in 2022.
It’s a concept store that combines the order-ahead function of the Starbucks app with the Just Walk Out technology that has been pioneered by Amazon. As such, customers can enter a lounge area by scanning either a credit card or the palm of their hands, and from here they can pick and choose from the regular beverages and snacks to a range of products handpicked by Starbucks and Amazon. Any item picked from the shelves would then be added to a virtual cart, and the customer would only be charged once they had left the store with that product.
The whole process builds on Amazon’s Just Walk Out technology that has spearheaded the cashierless shopping revolution. The Just Walk Out tech has already been successfully implemented everywhere from stores in Newark Airport to Whole Foods outlets across the US. All of which might minimize human interaction, but a Starbucks representative said that it would provide customers with ‘an experience that delivers convenience and connection in an effortless way.’
It comes at a time where Starbucks has been suffering as a result of a decrease in football as a result of the Covid-19 pandemic. The coffee chain lost $3.1 billion in revenues as in-store sales plunged by 40% during this time. There are plans afoot to open more of these pickup locations in several urban and suburban areas.
Such innovative moves have helped the Amazon stock price make some impressive gains with a rise of 3.7% on the same day that the Starbucks concept store was reported. There have been reports that the new partnership with Starbucks could bring in $50 billion for Amazon.
Amazon hoping that long-term plans pay off
Cashierless retail technology isn’t the only way that Amazon is trying to diversify its operations beyond ecommerce. With success in everything from film and TV to cloud computing and artificial intelligence, Amazon has grown to become one of the world’s most valuable brands.
The tech company has actually had a relatively difficult 2021. Much of this could be put down to elevated expectations considering how the ecommerce giant had benefited from lockdown measures in the pandemic. But with ongoing issues with the supply chain crisis and price rises in raw materials and labor, Amazon recorded less than stellar earnings in its third quarterly financial report.
While the short-term gains of investing in Amazon might not be too impressive at the moment, the brand is still a big hit with industry analysts who are expecting it to make long-term gains. Plus with enterprising deals such as the latest one with Starbucks, it looks like Amazon is making all of the right moves.