In the usual course of events, when Amazon or its close sibling Whole Foods opens a new food-retailing format, a huge burst of publicity ensues, often featuring enthusiastic, ill-informed predictions about how the new format will take over the world and everything will change.
Such was the case when the automated Amazon Go convenience stores started to roll out. The stores have no cashiers, so there was much publicity about how many tens of thousands of jobs across food retailing would be lost as the concept took over the entire industry. No such thing happened, nor is it likely to do so any time soon. Then the concept of package-delivery drones was touted as a transformational event. They’re now largely forgotten.
All things considered, it’s strange to see how quietly Whole Foods opened its first-anywhere conventional convenience store in the Chelsea neighborhood of Manhattan. The opening triggered no blare of publicity. To the contrary, there were only a couple of mentions in local publications about neighborhood happenings. The radio silence about the format probably owes to the fact that neither Amazon nor Whole Foods issued a press release about the new format. Why?
The lack of publicity from the store’s owners indicate to me that it’s an experiment, and a very low-risk one at that. The new store is in a small roughly 2,000 square-feet space in the corner in a building at Seventh Avenue and 25h Street. The ground floor is a large, full-scale Whole Foods Market. The proximity of the Whole Foods store means no separate product-distribution chain is required for the smaller new store. Conveniently, the space housing the new Whole Foods format was previously a Whole Body store, operated by Whole Foods, so there’s no new occupancy cost. Then, as now, the store has a separate entrance and exit with no interior customer access to the Whole Foods store that wraps around it.
Let’s take an inside look at the new store to get a better sense of what Whole Foods is up to. My recent tour of the store shows that it features mainly grab-and-go items such as prepared sandwiches, a limited line of baked goods, produce, florals, a cooler case for various beverages, a dairy cooler, a very limited grocery selection and magazines.
The focal point of the store is a staffed beverage bar identified by bright blue overhead Illuminated lettering announcing that it’s a “Coffee and Juice” bar, but many more drinks are available. There are eight bar stools set up across a side-window ledge to accommodate customers who want to consume their purchases at the store. Price points seem to be identical to those at the main Whole Foods store with the Amazon Prime member deals. The store has six checkout points, three intended to be staffed and three customer-actuated self-checkouts.
So, what’s the story here? If this store description seems familiar, that’s because it’s essentially an Amazon Go store without automated features. Like Amazon Go, it’s intended for nearby office workers and apartment residents who may want to pop in on a frequent basis to pick up a quick lunch or a couple of staples that need replenishment.
No surprise, the new store is called “Whole Foods Daily Shop,” according to what little publicity about the store we can find. Oddly, I saw no signage during my visit there. Instead, there was a temporary canvas banner fluttering in the wind heralding that the store was open.
It will be interesting to see if this staffed convenience store integrates the Amazon Go store mix into places where its full automated approach is too costly, customers are more likely to be part of the cash-based economy, or because shoppers are used to personalized service.
Amazon has the deep pockets and confidence to experiment with many store models as it moves more fully into the physical-store realm. Stay tuned, there will be a lot more to come.
Source: The Robin Report