This article was written by Chris Walton for Forbes.com on November 10, 2021 and is now available on Omni Talk.
The opening of Amazon’s newest Amazon Fresh store in Westmont, Illinois last week did not garner near the fanfare that it deserved.
The announcement is about as big as it gets in more ways than one.
First, the store is approximately 35,000 square feet, and, second, it is also a full “Just Walk Out” experience, meaning customers can walk in, take whatever they want off the shelves, and just walk out, without ever having to stand in line again.
But it is the size of the new store that is particularly noteworthy because it signals that Amazon’s checkout-free grocery shopping plans are now ready for primetime.
According to various sources, from Statista to FMI, the size of the average U.S. grocery store falls somewhere in the range of 30,000 to 50,000 square feet, so this latest Amazon Fresh store falls squarely within that range. Which is a remarkable achievement considering Amazon debuted its “Just Walk Out” technology to the public less than four years ago.
In fact, if one looks at the timeline, the achievement is quite staggering.
The first Amazon Go store opened in January 2018 and was roughly 1,800 square feet. Then in 2020, Amazon introduced its Go Grocery format, which was roughly 10,000 square feet and also included an expanded grocery assortment. Then, finally, in the summer of 2021, Amazon opened its first fully “Just Walk Out” Amazon Fresh store in 25,000 square feet.
If you are keeping score at home, the above means that Amazon has taken its “Just Walk Out” tech from an 1,800 square foot convenience store-sized operation to a now 35,000 square foot grocery store experience in the time it takes most retailers to have a meeting about just trying something new.
Meanwhile, to further drive that last point home, no other major retailer in the world has opened up a computer vision-based checkout-free retail operation similar to Amazon in anything larger than 5,000 square feet.
And, while last week’s opening is further proof of how woefully behind the grocery industry is in keeping pace with Amazon on checkout-free technology, there is actually a far bigger point at play here — namely, that Amazon is coming for grocery and the threat now looks very real.
Case in point, Placer.ai recently released a blog post that examined the performance of Amazon’s first Amazon Fresh grocery stores in California and Illinois and found that Amazon’s early stores in those states appear to be gaining market share against the likes of Ralphs and Jewel-Osco.
“The relative steadiness in visits shows that a core group of customers have added a trip to Amazon Fresh to their regular grocery routine, indicating that Amazon Fresh has successfully integrated into the grocery mix for the neighborhoods it entered,” the blog post said.
If these statements are true, then grocers need to be on high alert because one other fun fact about Amazon’s first Amazon Fresh stores (i.e. the stores Placer.ai analyzed) is that none of them were full “Just Walk Out” experiences, either.
If Amazon Fresh is already gaining market share in stores that aren’t checkout-free, then look out when the “Just Walk Out” versions, like the one that just opened up this past week in Illinois, sink their teeth into the Amazon Prime loving communities nationwide.
According to its website, the addition of the Westmont store means that Amazon now has 20 Amazon Fresh stores operating across California, Illinois, Pennsylvania, Virginia, Washington, Maryland, and Washington, D.C. Again, that is 20 stores across six states and one federal district in the blink of an eye, and less than a handful of them at this point even incorporate Amazon’s “Just Walk Out” tech in all its full checkout-free glory.
If Albertsons and Kroger weren’t scared before, hopefully they are now because at this rate they may not have a hope in hell left of slowing the Amazon grocery train down.