Never mind the gimmicks, the Amazon Fresh store is ready to scale

Amazon last week opened its first ever Amazon Fresh grocery store, in Woodland Hills, California.

This includes the Amazon Dash Cart, which enables customers to skip the checkout line, and new Alexa features to help people manage their shopping lists and better navigate our aisles.

So, what does the launch tells us about the e-commerce giant's plans? According to Rick Watson, CEO and Founder, RMW Commerce Consulting, the fact that Amazon launched in LA and not Seattle generally means the store concept is ready to scale.

"This is not a pilot. You don't like to screw up your biggest market unless you are (finally) ready to expand," he said in a LinkedIn post.

Also, the fact that the 'walk out' technology is not based on computer vision in the aisles but rather on the Amazon Dash Cart itself, reminds us that Amazon is not about gimmicks.

"It is about iteration. Keep this in mind when you scoff at their drones. It's an approach that could fail. But the approach has a reason, a goal," Watson commented.

"It was obvious vision wasn't going to work by itself in a huge store soon. Maybe later," he added.

Finally, Amazon Fresh is at a different price point than Whole Foods. "This is Amazon's foray into the mass market. I somewhat doubt they will open new Whole Foods stores. The Head of Grocery even said they saw them side by side."

“The real magic of Amazon grocery is the connections to Prime, technology convenience, pickup, and delivery. Will Walmart and Kroger be able to iterate as quickly? Amazon is betting no," Watson concluded.