Will Amazon Go be our friend or foe?
Dec 12, 2016, 6:25 AM | Updated: 6:26 am
(Nick Ansell/PA Wire via AP Images)
With Amazon Go aiming to change the way people shop for groceries, a union is stepping up to oppose the new tech-based shopping method.
“There’s this idea that workers don’t add value,” Erikka Knuti told the Dori Monson Show. “That they are a line item cost on a budget that you slice and dice. The reality is that these are the faces that smile and put money into the cash register at the point of sale. They are the faces of these brands and have inherent value. We vehemently oppose the idea that they don’t have an intrinsic value to the company.”
Knuti is with United Food and Commercial Workers International, a union that represents grocery workers. The union spoke against Amazon’s latest retail experiment — a physical grocery store where customers walk in, take the food they need, and walk right out. The purchasing portion of the shopping experience is handled entirely through a smartphone app, cutting out the middleman — the cashier in this case.
“We know one thing about Amazon as a company is that they’ve made their business by disrupting marketplaces,” Knuti said. “They disrupted the book industry by going online. Then they started opening brick and mortar bookstores later on. They kind of come in and disrupt a marketplace. That’s a great business tactic. But when 2.5 percent of all jobs in America are cashiers, you are now talking about disrupting 2.5 percent of the labor market. That’s 3.5 million Americans whose jobs could be changed here.”
Amazon Go and ‘segregated shopping’
On the other side of that argument is the nature of business and technology. As technology advances, and business changes, so does the landscape of the workforce. Such arguments have gone back and forth ever since the industrial evolution. But Knuti argues there are other factors at play when it comes to Amazon Go.
“This isn’t about blocking technology,” Knuti said. “What this is about is looking at new technology as it comes and asking if it benefits the community and is it benefiting the consumer. I would say that it isn’t in this instance.”
“You look at a store that requires you to have a smartphone, a data plan, and a bank account,” she said. “Only 68 percent of people have smartphones, 7 percent of people don’t have bank accounts, and where it gets interesting is that 20 percent of African Americans and Hispanic Americans do not have bank accounts. So it is a specific part of the population that you are cutting out of the store.”
Knuti argued further.
“I’ll play the senior citizen card because only 30 percent of people over the age of 65 have smartphones,” she said. “It becomes a segregated shopping experience. We have a lot of areas in which there are food deserts in communities, now here is an area in which you have to have a certain amount of income to have access to fresh food and nutrition … when we bring in new technology we have to look at if we are improving the customer experience, or are we disrupting communities and segregating consumers. This is not a luxury item. This is food. If you do not have food you die. If you don’t have good food, children perform lower in schools, people have attention problems and behavioral issues.”
Fallout from $15
And yet another side of the argument, one that Dori promotes, is that recent developments in the labor market have had a side effect. Take the move toward a $15 minimum wage, for example. Dori argues that as labor costs have been on the rise, companies have sought ways to cut down on such costs. Technology is a natural solution in such cases.
But there’s a side effect to that, as well, according to Knuti.
“As automation has come into supermarkets, it isn’t as if there hasn’t been automated checkouts, we’ve seen there has been higher instances of theft,” Knuti said. “A lot of areas where underage kids would swipe their beer and roll out the door. They’ve had to staff those automated stations with humans, regardless. And how many of us have had to go through an automated checkout line, and have had problems with the machine or a code and have had to get someone come over and key it in?”
The Amazon Go experiment continues. And in the end, it will be a battle won by what consumers want.
“In my grocery store I go to checkout 1,” Knuti said. “There’s a woman named Erin there and I love her smile. She knows my name. There’s a lot of people who feel that way.”
Dori thinks somewhat differently about the potential of an automated grocery shopping experience.
“It sounds awesome to me, as a consumer,” he said.