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IRUK Top500 The Customer Report: 2018

IRUK Top500 The Customer Report: 2018

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GUEST COMMENT The Rise of Amazon Go and the cost of convenience

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What effect will Amazon Go have on data?
What effect will Amazon Go have on data?
Peter Zaborszky, cybersecurity expert and founder of BestVPN.com
Peter Zaborszky, cybersecurity expert and founder of BestVPN.com

By 2021, the US could gain another 3,000 Amazon Go stores. While this is a victory for convenience, what does it mean for data privacy?

 

There is a reason why Amazon is the world’s largest online retailer. The leadership team understands what it takes to revolutionize the consumer retail experience. Data is at the heart of this paradigm shift and no other company on earth understands data like Amazon.

 

As the online giant pushes into the traditional retail market with more Amazon Go stores, it has also secured one of the most plentiful sources of consumer data that retail has ever seen. Which begs the question, are consumers paying for this convenience with their personal data?

 

Next Level Data Collection

For those unfamiliar with the Amazon Go experience, it eliminates the final step of the buying process. Instead of completing purchases at check-out, shoppers simply walk out with their selections. Access to this “store of the future” requires an Amazon account and the Amazon Go app. Once downloaded, the app gives shoppers a user-specific QR code which acts as the key to entry.

 

Entering an Amazon Go store is the physical manifestation of enabling website cookies. From the moment shoppers tap their personalized QR code, everything is tracked. While this isn’t a new idea for retailers (technology that tracks traffic patterns is common), Amazon cares about more than just shopping routes. Thetechnology is amix of both cameras and sensors, and while thereis no explicit use of facial recognition, it’s not unreasonable that Amazon will use this technology to gather other pieces of valuable demographic data.

 

In addition to the power of sight, Amazon Go stores are equipped with the ability to listen. The microphone capabilities of the store allow Amazon to process conversations. This feature nicely complements in-home Alexa devices. Pair the two experiences and Amazon doesn’t have to ever leave your side.

 

When you consider physical images and audio-listening capabilities, Amazon has reached a new level of data collection beyond that of internet cookies. Sure, Amazon’s traditional website can detect and analyze how long a user lingers on a product page and what they do there. But what it can’t do is physically see reactions or hear what is said to a friend nearby.

 

With this physical data unlocked, Amazon can build increasingly accurate buyer profiles, adding more physical traits to previous digital ones. With these enhanced and highly detailed profiles, Amazon can influence purchase decisions on agranularlevel.

 

This highly-specific data paired with emerging sensor technology is providing new ways for Amazon to incentivize purchases.

 

Take, for example, the common shopping habit of picking up an item, deciding against it and putting it back. With sensors that track Amazon Go items as they leave the shelves, this is no longer an overlooked action of the consumer retail experience. As the technology advances, it’s not a stretch to imagine shoppers receiving a mobile message urging them to reconsider or offering a personalized discount on something they’ve put back.

 

Cause for concern?

In a recent study, 45%of consumers reported feeling uncomfortable using platforms that track, use and potentially sell their data. The survey was gathered with only the digital world in mind. It is safe to assume then, that the number would be higher if users were aware that their physical, real-life data was also being gathered.

 

It’s this welding of the physical and digital that’s a potential cause for concern. As an online retailer, Amazon is already a target for hackers due to the sheer volume of information and subsidiary enterprises that fall under its banner. Amazon Web Services (AWS)is one of the largest cloud providers on the planet. Its customer base, which includes educational institutions, government agencies and financial providers, reaches just over a million and spreads across nearly 200countries.This, plusAmazon Go stores and the purchase of grocery giant Whole Foods, means data security concerns mayfollow consumers from the convenience store to the produce aisle - and then back home on the web.

 

Besides textbooks, gadgets and groceries, Amazon also has hands in the world of pharmaceuticals. Early this summer, Amazon acquired New Hampshire-based PillPack, a small online pharmacy. With this addition, Amazon will soon have the power to distribute prescription medications to consumers across the country. This means Amazon not only has data on consumer shopping habits, but it will soon have their health information.

 

When it comes to security, Amazon understands what it takes to successfully protect its users. But with recent privacy invasions from companies of similar scale and user base, it’s not completely unreasonable for shoppers to feel uneasy. Loyal Amazon users, all 300 million and counting of them, are bound to beon morethan one Amazon-developed app or site. Whether it’s Alexa, Kindle, Fire TV, Twitch or a platform hosted on AWS, the addition of Amazon Go is just one more entry point into the growing reservoir of Amazon data.

 

Corporations do the heavy lifting, but shoppers should still be proactive about their personal data security. Nearly half of consumers do not regularly check to see if their personal data has been compromised. By not browsing securely or creating strong passwords, users unknowingly brand themselves as easy targets. Common, simple passwords are open doors to hackers, and not even Amazon can protect against that.

 

Potential hacks aside, Amazon Go technology is still in its infancy. For now, it appears that the retailer isn’t selling consumer data. But Amazon is a tech company that places a high value on its proprietary data and pursues an almost constant stream of acquisitions. So it’s safe to assume that the data collected has far-reaching applications. A best practice for savvy shoppers is simply an awareness that personal data collection is happening - both physically and digitally.

 

With other retailers recognizing that change is necessary for survival, there is a quest for convenience producing similar technologies. Mistakes are bound to happen. While most will be minor, who’s to say there isn’t a larger security loophole still waiting to be found?

 

Image: Amazon

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