Retail giant Kroger to take on Amazon Go with Microsoft

Kroger, one of America’s largest grocery stores with around 2,800 units, is teaming up with Microsoft to digitise its portfolio, in what appears to be reaction to Amazon’s expansion of cashierless stores.

Kroger’s technology team has developed a smart tech system powered by Microsoft’s cloud platform, Azure, and connected by Internet of Things (IoT) sensors and is currently being trialled in two stores in the US.

• Read our jargon buster on Internet of Things

The pilot stores will leverage retail-as-service by introducing a variety of experiences including the latest generation of EDGE Shelf, a shelving system that uses digital displays to indicate everything from prices and promotions to nutritional and dietary information.

The shelving system uses digital displays to indicate prices, promotions, and nutritional and dietary information

The stores will use Microsoft Azure Artificial Intelligence to connect the smart shelves with Kroger’s Scan, Bag, Go app. This enables customers to leave without queuing up to pay and also be guided through the store by being shown the exact location of items.

Kroger’s Scan, Bag, Go app enables the customers to leave without queuing to pay and be guided through the store

Satya Nadella, CEO of Microsoft, believes the joint venture between the two will “redefine the shopping experience for millions of customers at both Kroger and other retailers around the world”, and the tech will set “a new standard for innovation in the industry”.

Additionally, solutions like Microsoft Azure-powered video analytics will help store associates identify and address out-of-stock items to ensure customers can locate products on their shopping list.

The EDGE Shelf will also enable Kroger to generate new revenue by selling digital advertising space to goods brands, whether customers want flashing advertisements whilst shopping or not.

By using video analytics, personalised offers and advertisements can be presented based on customer demographics when they walk into the store.

Kroger and Microsoft will jointly market the platform to other companies in the industry.

The rise of digital stores

Kroger isn’t the only company trying to keep up with Amazon’s plan to launch 3000 Go stores by 2021, as reported by Bloomberg.

International convenience store 7-Eleven is piloting a mobile app called Scan & Pay, and French retail giant Carrefour is testing technology from AiFi, a startup which provides cashier-free retail software.

AiFi uses AI to monitor shoppers and the content they take from the store

UK-based retailer Marks & Spencer also teamed up with Microsoft in 2018 to test the integration of Microsoft AI technologies into M&S’s customer experience, stores and wider operations.