Amazon Dumps “Just Walk Out” Technology as Retailers Nationwide Rethink Self-Checkout Strategies

Amazon is removing its cashier-less technology from Amazon Fresh grocery stores in the United States. The move is a significant reversal of what was once considered a revolutionary business model for the retail industry. The “Just Walk Out” technology uses sensors and cameras to track consumers as they grab items, allowing customers to bypass checkout. Amazon's supermarket stores will now shift to Dash Carts, connected grocery carts that scan items as they are placed in the basket. 

Since it acquired Whole Foods in 2017, Amazon has set out to disrupt the grocery store market, heavily relying on digitalized in-store experiences to compete with industry giants like Walmart. The company’s removal of Just Walk Out comes as other big-name retailers rethink their own self-checkout strategies.

Amazon first publicly revealed its Just Walk Out service in its Amazon Go convenience stores, which were likely more conducive to the grab-and-go system. The complex arrangement of sensors and cameras required by the technology surely became more expensive as it was scaled to fit the company’s grocery stores. According to The Information, Amazon depended on a team of 1,000 workers in India to manually evaluate Just Walk Out purchases, claiming that the employees had to review 700 of every 1,000 transactions in 2022. Amazon refuted this claim, saying that its workers are primarily training and improving upon the Just Walk Out Machine Learning (ML) models. Either way, the Just Walk Out technology requires a complicated array of machines and human teams to function, and could likely not scale to meet the needs of larger and more complex retail establishments.

Just Walk Out could also be a complicated and expensive system for consumers. Customers using the system are emailed their receipts only after leaving the store, with customers sometimes experiencing sticker shock after the transaction occurred. Amid inflation and cost-of-living concerns, Amazon has suggested that customers favor a system like Dash Carts that tracks the total cost of the groceries in their basket in real time. 

Amazon’s interest in the supermarket industry market makes sense—the supermarket and grocery store industry is a billion dollar market that is intensely relevant to most people’s lives. People’s familiarity with their local grocer can give a sense that grocery stores are stable and untouched by the upheaval that characterizes other competitive markets. However, the supermarket industry is going through a major disruption, with traditional grocery stores losing business to supercenters and club stores. Amazon has been the most bullish tech company invested in upgrading this industry amid an era of decline.  

Amazon’s competitors such as Walmart and Target have also invested in digitizing stores, introducing mobile shopping and, most visibly, a huge swathe of self-checkout stalls to ease the shopping experience. Like Amazon, these giant chains seem to be backtracking their self-checkout innovations, with Target announcing in March that its self-checkout lanes will be limited to 10 items or less. Some Walmart stores are reducing the number of self-checkout lanes available to shoppers, instead reserving them for Walmart+ customers and its delivery drivers. Self-checkout is a controversial new technology, with retailers increasingly concerned about shoplifting and customers often complaining about the clunky and impersonal process. Amazon’s removal of Just Walk Out signals that grocery stores and retailers have yet to find the checkout solution that can both improve operations and appease customers.

Though self-checkout systems have disappointed some retailers and customers, it is unlikely that stores will completely rescind them or other technological innovations intended to modernize the grocery store shopping experience. Instead, stores and large supercenters will follow Amazon’s lead, shifting to other digitalization strategies, rather than reverting to manual, cashier-led checkout. 

Tech companies and grocery store operators must consider store design and size when designing their modernization initiatives. Many in the industry thought machine vision technology and customer tracking would revolutionize grocery shopping. Amazon, unfortunately, proved this was an expensive, complex gamble that seems to have provided little reward in larger grocery stores. However, instilling a similar machine vision and people tracking function in a smaller storefront might be less complicated, as that would require fewer sensors and cameras. Amazon’s withdrawal of Just Walk Out from its grocery stores but not its Amazon Go convenience stores is a testament to how this technology is suited to some storefronts, but not others. Just Walk Out will also continue to be used by third-party retailers like airports and stadiums, further proving that small retailers with a grab-and-go business model could still find use for such a cashier-less system. 

A smart cart similar to Dash Carts could be a reliable alternative to self-checkout stands for larger grocery stores and department retailers like Target. Shoplifting is a significant concern with self-checkout stalls, as it is easier for customers to leave an item in the cart without scanning it or to type in a code for a cheaper alternative for produce. Stealing is more difficult with smart carts that automatically track and charge a customer for items in the basket. And while Amazon’s smart carts still require both sensors and cameras, it narrows the cameras' job to tracking products, rather than people, which will likely result in a less complex product that does not require as much manual verification.

These carts might also be better for consumers, who are more familiar with the function of a grocery cart than they are with scanning their entire grocery order. While some shoppers may continue to lament any changes in their local grocery store, inflation and increasing competition will continue to drive grocers to adjust their traditional layout. As is the case with Amazon, this will mean that stores (and customers) must endure a period of technological trial and error until stores can find the right recipe for customer satisfaction and increased revenue.