Sainsbury’s has revealed a new checkout-free shopping solution using Amazon’s Just Walk Out technology. We explore how this will benefit Sainsbury’s and how it fits into Amazon’s trajectory in the UK grocery market.
The SmartShop Pick & Go solution will be available at a convenience format Sainsbury’s store in Holborn, London. Visitors have to scan a QR code on their SmartShop app when entering the store and again when leaving. Customers will then be charged automatically via the app for the items they’ve selected.
Sainsbury’s SmartShop app
What we think
We heard rumours about this partnership a few weeks back, and those followed the unconfirmed reports of WH Smith in the US partnering with Amazon for a similar roll-out in its travel business. This is then the confirmation that Amazon has moved to license its ‘Just Walk Out’ technology, an interesting move given its slow organic build of the Amazon Fresh chain in the UK.
However, we shouldn’t be surprised at Amazon being willing to share its technology, as it fits perfectly with its trajectory in UK grocery to date. In the online space the retailer has slowly built its own Fresh offering, but has also allowed partners onto its platform, sharing its massive reach and technology.
In the physical space it will continue to build out the Fresh chain, but as we’ve written before – for Amazon to truly disrupt the grocery sector in the UK it would need hundreds, if not thousands of stores – given the size of Fresh.
Amazon Fresh entry gates, Wembley
If rolled out further, this licensing move will allow the business to more quickly extract value from UK grocery with minimal capital investment. Amazon has shown it does not need to have a large direct hand in the market to exert influence, and its list of partners in the sector now includes two of the big four, Morrisons and Sainsbury’s, alongside the Co-op and Booths.
On Sainsbury’s part it is a sensible move as the technology is known to work and, if successful, will more quickly allow it to scale full checkout free stores. Tesco, via its partnership with Trigo, has also moved into the space. With Amazon opening a further Fresh store in Holborn last week, it means that three of the most talked about concepts in UK grocery will now be within a five minute walk of each other.