Amazon tests grocery pickup service in Seattle

An Amazon worker waits for customers while standing inside an AmazonFresh Pickup location, Tuesday, March 28, 2017, in Seattle. In order to try and figure-out a fix, Amazon is delaying the launch of Amazon Go.

The company also realized consumers are not moving towards online grocery sales as quickly as anticipated, despite its long-term investments in Amazon Fresh, which is progressing relatively slowly. It's already available in many U.S. cities, and Amazon is also testing several futuristic options for Fresh, including drive-in grocery pickup centers in Seattle's Ballard neighborhood where shoppers have online orders loaded into their cars. The stores are still in beta, with only Amazon employees able to use them.

The test store has been open to Amazon employees since December a year ago, but the Journal says that another problem is that the technology in its current form can only track customers if they're moving around the premises very slowly - an issue that we hope doesn't lead to speed limit signs appearing along every aisle. But according to a report today from The Wall Street Journal, the store's opening has been delayed due to technical issues.

There's a brand new perk available to Amazon Prime members looking for an easier way to grocery shop. An array of sensors tracks shoppers, who can pick up items from the shelves, get them added to a virtual cart, and walk out of the store without going through a cashier. However, that service costs $15 a month for delivering groceries to a shopper's doorstep, while AmazonFresh Pickup locations will be free to use.

It's tempting to say that the delay is a stark reminder for Amazon of the challenges it will face expanding its expertise in online retail to physical retail.

Still, grocery delivery hasn't appeared to be a particularly successful business for Amazon, since selling supermarket food is already a very low-margin business.

  • Wendy Palmer