People shop at the newly opened Amazon Go Store on May 07, 2019 in New York City. The cashier-less store, the first of this type of store, called Amazon Go, accepts cash and is the 12th such store in the United States located at Brookfield Place in downtown New York.
Spencer Platt | Getty Images
Amazon is in talks to bring the cashierless technology that runs its Go stores to other retailers like airport shops and movie theaters, according to people familiar with the matter.
The effort would help Amazon grow its retail presence so the company can lower its reliance on online shopping, but at a faster pace and at lower cost than building its own stores. Simultaneously it might help Amazon form bonds with companies that would ordinarily consider Amazon the competition. That type of collaboration could lead to further growth of Amazon’s cloud business.
Amazon already has 16 branded Go stores where customers scan their phones, grab products off of shelves and then walk out and receive a receipt for whatever they took with them. Amazon is eager to place the underlying components for that experience inside other companies’ stories to speed up transactions, three people told CNBC.
The company has been in talks to bring Go equipment into OTG’s CIBO Express stores at airports and Cineworld’s Regal theaters, one of the people said. Another person said Amazon is looking at concession stands in baseball stadiums.
The idea is to start installing the technology working for customers in the first quarter of 2020 and have hundreds of these stores working by the end of 2020, two of the people said. One person said Amazon hopes to have the upgrade process take just two weeks.
Amazon has explored different business models for its third-party Go strategy. The company looked at asking for a percentage of sales from the goods people purchase through the Go-equipped stores, or charging retailers up-front and then taking a monthly fee, two people said. It’s not clear if the Amazon brand name will be visible on the Go hardware or which app customers would use to sign in.
An Amazon spokesperson said the company doesn’t comment on rumors or speculation. OTG declined to comment. Cineworld did not immediately respond to a request for comment.
Amazon opened its first physical brick-and-mortar bookstore in 2015. Physical stores debuted as a source of revenue on Amazon earnings statements in 2017, after the company’s $13.2 billion acquisition of Whole Foods Market. A year ago Amazon went even further in physical retail with the introduction of the first Amazon 4-Star physical store, which hawks products with positive customer reviews.
The first Amazon Go store opened to the public after a delay in January 2018 at the company’s campus in Seattle. Today there are 16 Go stores in four U.S. cities, with another two stores on the way, and altogether there are over three dozen Go, Amazon Books and 4-Star stores. Amazon was aiming to open as many as 3,000 Go stores by 2021, Bloomberg reported last year.
The Go location at Amazon headquarters operates profitably, but many other locations don’t, one of the people said.
Reuters reported in December that Amazon was eyeing airports as locations for its Go stores.
The retrofitting system Amazon has thought up can function without consuming computing or storage resources from Amazon Web Services, Amazon’s market-leading public cloud, two of the people said. Over time, though, as retailers become warm to working with Amazon, they could start to adopt AWS.
Microsoft, which competes with Amazon in the public cloud market, has won business from retailers like Walmart and Walgreens Boots Alliance following the Whole Foods deal. In February Microsoft said it was planning to work with Albertsons Companies to end checkout lines. Target was looking to move away from Amazon’s cloud in 2017, CNBC reported, and has started using Google’s. AWS does have retail customers including Chai Point and Levi’s.
— CNBC’s Lauren Hirsch contributed to this report.