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Daily news and analysis about the food tech revolution

Amazon Dash

Dash & Go: Amazon’s Strategy To Attack The Grocery Market

I can’t stop thinking about Amazon Go.

If you missed it this past week, Amazon blew our collective minds with the unveiling of their rethink of the grocery store. I wrote, “if you’re a grocery store and aren’t worried about what Amazon is doing, you should be. With Just Walk Out, they are looking to utilize IoT, AI and mobile to extend their dominance from the online and in-home commerce world to the corner grocery store.”

How does this fit together with what else they’re doing in the grocery realm? I’d describe it as a strategy of ‘Dash & Go’, where they ‘Dash‘ towards the middle of the store filled with dry goods and commodities and then ‘Go‘ after what I call the “fresh edge”, around the perimeter of the grocery store where everything is fresh, artisanal, green.

This strategy crystallized for me when I read the following description of Amazon Go:

“We offer delicious ready-to-eat breakfast, lunch, dinner, and snack options made fresh every day by our on-site chefs and favorite local kitchens and bakeries. Our selection of grocery essentials ranges from staples like bread and milk to artisan cheeses and locally made chocolates. You’ll find well-known brands we love, plus special finds we’re excited to introduce to customers. For a quick home-cooked dinner, pick up one of our chef-designed Amazon Meal Kits, with all the ingredients you need to make a meal for two in about 30 minutes.”

That’s the fresh edge, folks.

When you look at Amazon’s Dash partners, you see a whole lot of packaged goods, whether that means bottles of fizzy drinks, cleaning supplies, or toiletries, etc. It’s the high-volume, sometimes boring stuff that consumers know they need and just want to make sure they have at all times.

Some have speculated Amazon Go is a proof of concept meant to showcase the technology to potential customers like, well, grocery stores. I disagree. Just Walk Out, the technology platform at the center of Go, is certainly interesting and something other grocery chains would want. But here’s the thing: I’m not sure Amazon is in the innovation business to help other grocery stores.  While they may “lend out” their innovation in the areas of cloud computing and Alexa through as-a-service models and APIs, I can’t see them creating a massive reinvention of the grocery store concept for others to use without first trying to capture as much of this market themselves as possible.

Some may also wonder why I don’t see Amazon Fresh, Amazon’s grocery delivery business, as a “third leg of the stool” in this grocery strategy. I’m not ruling out that the delivery of fresh will some day become a very important business for Amazon, but you have to wonder why a grocery delivery business they’ve been working on for a decade hasn’t been scaled very widely yet. This tells me that they may realize home grocery store delivery, which has been a dream of Internet innovators since the days of Webvan, may not be the most efficient way to get food to consumers.

Lastly, I don’t think Amazon is done. They hint in the video (see below) they’ve been working on Go for four years, which makes you wonder what else they are working on. I’ve heard from multiple Amazon folks they have a bunch of new tricks up their sleeves in 2017 (one of which could be a “kitchen computer”), so there’s a good chance the company will blow our minds next year as well.

Introducing Amazon Go and the world’s most advanced shopping technology

Amazon Wants To Automate The Grocery Store

Last month, I wrote about Amazon’s attack on the middle of the grocery store as it installs millions of auto-replenishment buttons in our homes.  As it turns out, this may only be the beginning.

Today the company announced a new grocery store concept called Amazon Go. The first store, which is currently open only to Amazon employees, utilizes what the company calls “Just Walk Out” technology to eliminate the worst part about going to the grocery store: cashiers and checkout lines.

What is Just Walk Out? According to the company’s intro video, it’s a mix of “computer vision, deep learning algorithms and sensor fusion” that combine to eliminate the need for the old-fashioned checkout. While they don’t go into more detail than that, here’s what I think they’re doing:

Computer vision: This means cameras to both identify the person and what they put in their bag. This most likely includes facial recognition technology for shopper identification, so your face is now your ID.

Sensor fusion: Likely a combination of proximity sensors for the shopper and RFID tags for the products themselves. For the RFID tagging, it’s probably not unlike those conveyor belt sushi restaurants where they can tell when you pick something up, only here you’re not sitting at a table but moving around the store.

Deep learning algorithms: the most mysterious part of ‘Just Walk Out’, but likely also the most valuable to Amazon. That’s because deep learning probably means behavior tracking, where Amazon not only learns what you buy, but what you almost buy. Stores like b8ta are experimenting with understanding how long consumers linger and interact with different products, and I would bet Amazon will use proximity sensors, cameras and sensors on the devices themselves to better understand your interests.

If you’re a consumer, the benefits are obvious. Being able to just pick up a quick meal and walk out is something anyone who has waited in a long line during lunch hour would jump on immediately. While there’s a slight creepiness factor to the tracking technology and just how much Amazon will know about you once you walk in their store, I have a feeling most consumers will shrug their shoulders at the big-brotherness of it all. After all, it’s not like they’re shying away from putting an always-listening speaker in their homes.

Bottom line, if you’re a grocery store and aren’t worried about what Amazon is doing, you should be. With Just Walk Out, they are looking to utilize IoT, AI and mobile to extend their dominance from the online and in-home commerce world to the corner grocery store.

Introducing Amazon Go and the world’s most advanced shopping technology

The Subscription Kitchen: Connected Kitchen and Home Delivery (VIDEO)

How do subscription models and the smart kitchen fit together?

That’s what Brita Rosenheim, the founder of Rosenheim Advisors, wanted to find out at last month’s Smart Kitchen Summit on the panel entitled, “The Subscription Kitchen: Connected Kitchen and Home Delivery”.

Joining her on the panel were:

Daniel Rausch – head of Amazon Dash, Amazon’s auto-replenishment platform

Kevin Yu – CEO of SideChef, a connected kitchen platform company working with Chef’d on a mealkit subscription service

David Rabie – CEO of Tovala, a company creating smart oven with a mealkit delivery subscription service.

Amazon Announces The PoopBag Button (And 59 More Brands) As Dash Continues To Grow

If you think Amazon is betting the future entirely on the voice interface, think again.

That’s because despite a huge bet on Alexa and all things voice, the company is also ensuring our homes will be filled with lots of new physical interfaces in the future, especially those tailored towards replenishing our cupboards and closets with everything from toilet paper to garbage bags.

Towards that end, the company announced a slew of new brand partners, bringing the total number up to 200 different types of Dash buttons .  The new brands partners include some well known such as Purell and Cheez-it, as well as some lesser known products like PoopBags.

Amazon also revealed that orders using the Dash button have increased fivefold over the past year, although it’s unclear what exactly that means. As with most data that Amazon releases regarding its own products, a 500% increase is impressive on its own, but also leaves you wondering just how many people are using the technology on a regular basis. It could be they’ve shipped five times as many buttons and most people are only ordering once in a while, or they have figured out a way to actually get people to engage with their button more frequently. Until Amazon actually releases more data, we’ll have to keep making educated guesses.

I wrote last week that the company risks the Dash button becoming less important over time unless they enable a more universal button. I still believe that, but given what may be growing concern among consumers around connected devices in light of the recent Mirai botnet attack, the Dash button continues (for now) to be a low-risk and easy-to-understand way for the company to bring auto-replenishment to the masses while it continues to attack the commodity section of the grocery store.

If you want to hear Amazon Dash chief Daniel Raush talk about his vision for Dash, you can watch the video of his session at the Smart Kitchen Summit below.

The Subscription Kitchen: Connected Kitchen and Home Delivery from The Spoon on Vimeo.

The Dash Button: What Should Amazon Do About Its Forgotten Interface?

At this year’s Smart Kitchen Summit, Amazon’s Alexa Director Charlie Kindel said that while the last decade was defined by mobile devices and touch screens, the next decade would belong to voice as the emergence of highly-capable natural language interfaces like Alexa became mainstream. “We are,” he proclaimed, “entering the era of the Voice User Interface (VUI)”.

While I agree that voice will become an ever more important interface in coming years, I don’t believe physical interfaces are going anywhere. In fact, I think one physical interface in particular – the button – will be just as important a decade from now as it is today.

So why do I believe in the boring old button? In part because boring usually means simple, and there’s nothing more simple than a one-function button. Whether it’s the alarm clock snooze button or the brew button on your coffee maker, simple physical interfaces like this usually provide the most direct route to initiate an action, especially compared with the almost inexhaustible variations of commands and functions available through something like Alexa.

Don’t believe in the importance of buttons? Just imagine having to say “Alexa, shut the alarm off” at 5 AM after a late night instead of just slamming your snooze button in hangover-induced rage.

All of which brings us to Dash. Introduced a day before April Fool’s Day in 2015, it turned out the button was no joke, as the button (and the associated Dash Replenishment Service) represented an effort by Amazon to bring point-of-consumption ordering to the home and into the kitchen. ‘Why wait for consumers to go to the Amazon website?’ Amazon seemed to be asking with the Button, when they could move the point of replenishment and reordering to the actual point of consumption?

Ingenious in a way, but a year and a half after its introduction, it’s worth asking how the Button has done. While Amazon itself doesn’t release data, data from a survey of Dash users show moderate engagement at best. According to Slice Intelligence, research done in the spring of this year show that only half of folks who had a button used it.

While the low usage doesn’t seem to have discouraged Amazon about the broader Dash effort, it certainly seems announcements about new Dash buttons have slowed as of late. Lately most Dash announcements come in the form of new Dash Replenishment Service deals, as well as in the form of a the second generation Dash wand, a product that may gain new life now that its freed from the shackles of Amazon Fresh.

So as Alexa and era of the voice interface comes into focus, does the Dash – and connected buttons in general – have a place in the connected kitchen and broader smart home?

The answer is yes, but probably not in its current form.

The reality is the idea of brand-specific buttons (which is what Amazon Dash is) is too limiting. Instead, Amazon needs to make all Dash buttons universal single-function order/action machines.  In other words, they need to make them programmable, but unlike the AWS IoT button they’ve made available to those willing to go through lots of pain and suffering, Amazon needs to make one for consumers, not developers. In other words, they need an order-anything Dash button for the average Joe.

The reasons Amazon should move to universal buttons are both practical and strategic. From a practical standpoint, a Dash button for one specific product is too limiting for most consumers. I understand Amazon’s original vision was to bring connected ordering and allegiance to specific brand partners, but the reality is preferences change and consumers don’t want to be locked into specific products, often at higher prices.

I learned this lesson first hand. I was an early Dash button buyer, but the Izze beverage button I bought is now useless since my kids have moved on from the fizzy fruit drink. But if I could now re-program it to order, say, coffee or energy bars, I’d do it.

From a strategic standpoint, while limiting Dash buttons to single products likely makes the large brand conglomerates happy, it creates an artificial constraint around Dash button deployment. It also limits the data and insights they get. Imagine the unparalleled insight into reordering and consumption of consumables around the home Amazon would get with a order-anything button. Not only that, they’d also get insights into other types of behavior besides just shopping if the button could be used as a more smart home and kitchen interface.

At some point down the road Amazon may move on from the Button. After all, they are increasingly moving Dash into devices and, now that they are giving the Wand second life with a refresh and access to the entire Amazon catalog, they may see Dash itself – or maybe they’ve always seen it this way – as a stop gap.

But the button lover in me isn’t worried since, after all, there are other do-anything buttons out there. And who knows, maybe after a while I’ll get the hang of this voice interface thing after all.

Image credit: Dan Malouf

Smart Kitchen Notes: Juicero & June Funding Show Growing Interest In Smart Kitchen

Even though the Smart Kitchen Summit is six months off, we’re getting very excited as we put together our early list of speakers and panels. Adding to the excitement is the growing interest the broader tech community is taking in the smart kitchen, as evidenced by the high-profile funding rounds for smart kitchen startups like Juicero and June, while lots of new and interesting startups are entering via Kickstarter and elsewhere.

Speaking of Juicero, the connected juicer startup came out of stealth last week, and we have the story of the company’s $700 cold-press home juicer and home subscription service. We also discuss SideChef’s attempt to integrate its cooking app with a variety of third-party devices to enable easy connected cooking experiences, and take a look at some of the first data points around Dash Button usage.

If you prefer to consume smart kitchen info in podcast form, you can hear a conversation with Kevin Yu of SideChef and David Rabie of Tovala in this episode of the Smart Kitchen Show, and you can hear Juicero founder Doug Evans discuss the vision behind the company here.

In Smart Kitchen Summit news, we have assembled have a great bunch of speakers for Smart Kitchen Summit 2016 (we’ll be announcing them soon), but we still have slots open. We’ve opened up a call for speakers, so for those who are passionate and feel they have something to say, let us know a little about you and what you would be interested in talking about.

Lastly, we’re six months out from the main event as of today, but early early bird ticket prices expire at the end of May. If you are interested in a ticket, newsletter subscribers can get an extra 5% discount through April.

Now onto the news and analysis.

Meet Juicero, The First Big Stealth Startup Of The Connected Kitchen Era

Back in the early days of the digital home, one secretive startup named Rearden Steel captured the imagination of many in space, quite a feat in a market with no shortage of buzz or aspiring entrepreneurs hoping capitalize on growing consumer interest in connected entertainment. Sure, the company’s Atlas Shrugged inspired name had something to do with the intrigue, but a bigger reason for the high level of interest in the company was that Rearden was to be the next act for Steve Perlman.

Perlman had built quite a name for himself as the founder of Internet to TV startup WebTV. Eventually WebTV was acquired by Microsoft, and not too longer after Perlman left to create Rearden Steel. For over a year people wondered what exactly he was up to, and when he eventually lifted the veil, it was clear Perlman hadn’t strayed far from his digital living room roots with Moxi, a company building connected entertainment devices and software. Read More

SideChef Wants To Set The Standard For The Smart Kitchen

Imagine you pull up a guided cooking app and choose a steak and roasted vegetable recipe. The app tells the oven to preheat for the veggies, and your connected scale prompts you to weigh out the recipe’s ingredients. Your sous vide cooker begins to heat the pot of water to the exact temp needed to cook the perfect sirloin. You use one app, and one platform to walk through the recipe and control your entire cooking experience. Sound futuristic? This is the kitchen SideChef hopes to create. Read More

Quick Hits:

Amazon Adds More Dash Button, But Are Consumers Using Them?

The Gist: Amazon added more products to the list of Dash Button partners, bringing the total number of available products to over a hundred. However, according to online shopping panel research company Slice Intelligence, about half of those who have buttons are using them.

Our Take: Amazon keeps adding new buttons, and why shouldn’t they? Brands love it and the press keeps writing about it, as the button is unique in that it’s the widely deployed IoT platform for brands and push-button shopping.  For brands, there’s really no downside by creating a button for your product, and I imagine Amazon is pretty overwhelmed with requests from CPG product managers.

slice intel

Source: Slice Intelligence

As far as data goes, Amazon never releases very good data to give you an idea of how any new initiative is doing, so I never take too much stock in data points such as “Dash orders are up 75%”.  So that makes the Slice Intelligence data interesting, which is the first real data around usage I’ve seen. While user panel data is never perfect, I think around 50% usage for Dash Buttons overall and the brand breakouts for top Buttons overall is not surprising to me and feels pretty accurate.  I’m interested to see how this data trends over time as we see the offering of Buttons expands and we see new product categories – including everything from condoms to beef jerky – roll out.

June and Juicero Funding Rounds Show Investor Interest in Smart Kitchen

The Gist: June, the smart countertop oven that sees your food and cooks it to perfection closed on a $22.5 million dollar Series A funding round last month. The round was led by Eclipse, a VC interested in companies combining hardware, software and data, and included new and previous investors and brings the total amount raised to date to $30 million. June also announced a delay in shipping, pushing back initial pre-order fulfillment from the summer until the holidays. This came a week before the Juicero news of a $70 million round.

Our Take:  The word in Silicon Valley is overall funding has been slowing down dramatically in the last few months, which makes these two high profile funding rounds for smart kitchen companies make me think that food tech and the connected kitchen is a particularly bright spot in an overall down market. This would be in line with what we saw in 2015, where overall food tech venture investing was up significantly, and we expect more and more food tech investors see opportunity in the kitchen as companies look to reinvent cooking.

Lowe’s / HoloLens partnership

The Gist: Lowe’s is bringing virtual reality to kitchen design

Our Take: We’ve seen connected technologies changing many elements of the kitchen including recipes and methods we use to guide our cooking and the devices and appliances we use to store and cook our food. But bringing HoloLens virtual reality into kitchen design is perhaps the first foray into changing how we build and create our kitchens in the future.

Smart Kitchen Summit News

Speaker Submission now open!

Are you passionate about the future of food and the kitchen? Are you a world class expert on a topic that would educate and amaze at Smart Kitchen Summit 2016? We want to hear from you! We are putting together an amazing roster and a great program and you might be part of it. Submit today!

That’s it for this week. Subscribe to our newsletter here if you haven’t already and make sure to take advantage of early early bird pricing for Smart Kitchen Summit.