Amazon Go and Freshippo are leading the industry when it comes to innovative retail establishments. Freshippo, also known as Hema, is a China-based grocery store that is successfully riding the wave of the “New Retail” movement, which has been deemed as the bridge between the online and offline shopping experience. Freshippo is part of the Alibaba Group Holding Ltd, a Chinese competitor of Amazon. The Amazon Go convenience stores rolled out in 2016, are the beginning of Amazon’s grand plan to expand into the full-service grocery store business. While Freshippo may be ahead of the game in the grocery store market, Amazon is not far behind. Freshippo has over 46 stores and growing while Amazon Go has 10 establishments. However, Amazon announced they are planning to open dozens of grocery stores and plan to open 3,000 more Amazon Go stores across the U.S by the year 2021. While these goals may seem ambitious, Amazon’s testing of the Amazon Go convenience stores must have given them the confidence to move into the grocery store market.

Freshippo vs. Amazon

Freshippo and Amazon are focused on customer-centric experiences. Freshippo and Amazon Go alike, require users to have an account to shop. Customers sign up through the app or website and connect their billing information for a seamless experience.

Freshippo and Amazon Go both offer a virtual cart so customers can view their purchase history and even receive suggested items. Unlike at Amazon Go, at Freshippo customers still, are required to check out. However, it is not a checkout in the traditional sense which involves waiting in lines and scanning every item. Instead, customers simply bag their items and scan their code at the checkout. It then charges their account.

At Amazon Go, customers scan their account codes as they enter the store. While shopping all they need to do is take the item off the shelf. Amazon Go uses high tech sensors to determine which products the customer takes off the shelf. Customers are then charged through their account upon exiting the store. This creates a frictionless customer experience with no lines and no scanning of items.

While Amazon offers delivery through other services, their Amazon Go stores do not. Freshippo recently introduced 24-hour grocery delivery. Their delivery time is 30 minutes for customers within 3km of a store. It is reported that people are moving specifically to live closer to Freshippo stores.

As a convenience store, Amazon Go does not offer in-store chefs like Freshippo. However, they have addressed this by offering freshly made to-go dishes from local chefs and establishments.

Predictions

Here are my following predictions for Amazon Go and their grocery stores

1. We will see the same “grab and go” technology from Amazon Go convenience chains implemented in their grocery stores.
2. Amazon will integrate AmazonFresh, which is Amazon’s current grocery to doorstep delivery service, into their grocery store operations
3. Amazon will offer 24- delivery in their grocery stores
4. Customers will be able to see or track exactly where their food came from…farm to grocery!
5. Amazon will determine item pricing/deals/coupons by using AI and predictive analytics from analyzing consumer purchasing data in their grocery and Go stores

Here are my Freshippo predictions:

1. Freshippos will continue spreading throughout highly populated cities across China
2. I predict we will see Freshippo roll out “pop-ups” and convenience stores with high tech
3. While the company claims it has no plans of going international…it underwent a rebranding from “Hema” which means “Hippo” in Chinese, to “Freshippo” which is more universally recognized which leads me to believe the company has long term goals to expand internationally
4. We will see other grocery stores, especially in China, modeling technology and processes after Freshippo
5. Freshippo will try to emulate the “grab and go” technology that Amazon Go stores use to eliminate the customer checkout process of scanning their code

Sources:

[1] https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/49324497

[2] https://csnews.com/amazon-reportedly-gearing-open-dozens-grocery-stores

[3] https://www.alizila.com/hema-launches-10-new-stores-10-cities/

[4] https://www.alizila.com/hema-supermarket-offers-shoppers-new-retail-experience/

[5] https://www.pwccn.com/en/retail-and-consumer/publications/global-consumer-insights-survey-2018-china-report.pdf

[6] https://www.forbes.com/sites/andriacheng/2019/01/13/why-amazon-go-may-soon-change-the-way-we-want-to-shop/