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Daily news and analysis about the food tech revolution

Bodega

Amazon Shrinks Go Store to Go After Hungry Office Workers

Amazon is looking to grow its burgeoning Go store experience by thinking small. Reuters reports that Amazon has created a smaller version of its cashierless convenience store that can fit inside existing high-traffic areas like office buildings.

Like so many of Amazon’s products, the first such mini-Go is already in place in one of Amazon’s office buildings in Seattle. Coming in at just 450 square feet, this Go-lite sells snacks and salads to hungry Amazonians.

Word of the micro-Go comes just days after a report that Amazon was in talks to put its regular Go stores in airports. Putting the pieces together, we can see Amazon’s plans for its Go store rollout take shape: just put them everywhere.

In all seriousness though, the checkout line-less Amazon Go store experience is perfect for high-traffic areas like airports and busy office buildings. Shrinking the footprint down and reducing the inventory to real grab-and-go items like snacks lines up with the lifestyle of harried workers looking for a fast bite.

My first thought upon reading the news of the li’l Go store was how it would impact other tiny convenience stores coming to the market. Deep Mind builds similar small cashierless walk-in kiosks to create retail environments inside office lobbies and such. But its technology is hampered by the fact that it can only service one purchaser at a time.

Then there are companies like Byte Foods and Stockwell (formerly Bodega). Byte makes smart office fridges that vend food, while Stockwell makes credenza-sized mini-marts that employ similar grab-and-go technology for populous spaces like apartment buildings. How small will Amazon go with its Gos? Both could feel the heat if Amazon ratchets this tiny Go initiative, and there’s no reason to think that they won’t.

Amazon seems to be hitting the accelerator when it comes to Go, as the company is hiring like crazy to grow the Go team. Amazon is a trusted brand name that deeply understands delivery and fulfillment, so it shouldn’t surprise anyone if Amazon turns little shopping stores into a big business.

Bodega Changes Maligned Moniker, Rebrands as Stockwell

If you remember anything about Bodega, the startup that puts automated micro convenience stores closer to consumers, you probably remember the problems with its name.

In short: people hated it, and by extension, the company, for epitomizing a tech bro culture that insists on “disrupting” existing neighborhood institutions with cultural insensitivity, all while overhyping what some believed to be a glorified vending machine.

The Bodega founder apologized in a corporate blog post in September of last year (the same day the company announced itself) and the startup seemed like it was destined to fizzle out like so many others.

But here we are, almost a year later, and the company isn’t just still around, it says it’s expanding. Only now it goes by the name Stockwell. This slipped under our radar, but thanks to a heads up from our Spoon Slack channel we came across a Stockwell blog post dated July 18, 2018, in which Co-Founder and CEO, Paul McDonald explained the name change:

“Coming up with a name for what we do — bringing every day essentials to consumers quickly and easily — was a challenge. The inspiration for our former name, Bodega, was, we thought, an homage to the local corner store, the people who ran it, and their place in our collective conscious. We were wrong. We reviewed the feedback thoughtfully and ultimately decided that our new name, Stockwell, was a better expression of our mission and our unique offering to consumers — a store open 24 hours, filled with the things they need, located right where they live, work and play.

Over the next weeks and months you’ll see our evolution into Stockwell, including an incredible new app for shopping with us. We’ll continue to celebrate small, local brands and also bring you products you know and trust. And of course, Stockwell will personalize your store to fit your community’s needs.”

For the uninitiated, Stockwell’s vending system uses a combination of mobile app and computer vision, a la Amazon Go, to keep track of what you take from it and charge you accordingly.

Setting aside the deeper societal implications and missteps made, as Spoon writer, Allen Weiner, wrote about Bodega Stockwell last year: “It’s worth noting that the concept of providing last-minute necessities is not a new idea. Catering to the immediacy of meeting a consumer’s specific needs on the spot in itself is not a bad idea and there are many successful applications in place.”

Humanless retail is on the rise. Byte is doing something similar with smart fridges and lunches for offices, Briggo is installing its automated Coffee Haus in places like airports to make grabbing a latte on the go a little easier, and Robomart is working to bring the convenience store to you.

Stockwell fits well within this trend. There are places where its vending system makes sense, such as college dorms and corporate campuses, where there may not be a convenience store nearby or open at all hours.

But a good idea isn’t always enough. Will this re-branding bring redemption for Stockwell?

I think there’s an opportunity for Stockwell to partner with (or get acquired by) someone like an AirBnB. Qvie debuted a tiny vending system for AirBnB hosts, but having a micro-convenience store for stuff travelers forgot at home — or a curated selection of local packaged foods they should try — would be a nice add-on and potential additional revenue source for hosts.

Hopefully people don’t hate that idea.

Bodega, The IoT Convenience Store, Meets Early Resistance

Now introducing the concept of place-based commerce. That is the idea of putting relevant products in the just the right place for busy consumers who can buy them with the swipe of a smartphone. The bet for projects such as Bodega is that busy millennials will be willing to trade convenience for the social interaction of traipsing to the corner mom ’n’ pop store for a late night shopping spree.

Bodega, founded by two ex-Googlers, starts with what is basically a cabinet-based vending machine. But, instead of loading it with sugary soft drinks and microwave popcorn, it dispenses goods related to a specific location or purpose. A Bodega placed in a health club might have sports drinks and protein bars; one in the lobby of an office building could have healthy lunches and a Bodega in the lobby of a college dorm would sport anything from handheld devices to personal hygiene products. To keep things secure, the company uses a set of techno future security measures in which the customer opens the Bodega with his or her smartphone. After selecting a product, an AI-powered camera captures the purchase and debits the user’s payment method. The camera also collects crucial data on what was purchased, when and by whom. The resulting information is a goldmine for Bodega as a planning tool for inventory replenishment and for future system improvements.

From concept to name, Bodega has not been given a front row seat on the welcome wagon.

First, there’s an issue with the name. Bodega has come to mean a small grocery store—one that often features Hispanic products. Hispanic leaders consider naming the new concept after such a proud institution in the Hispanic community as an insult.

“It’s sacrilegious to use that name, and we’re going to do whatever we need to do to fight this,” Frank Garcia, chair of the New York State Coalition of Hispanic Chambers of Commerce, told the Guardian. “It was devastating to find out … and it’s not fair to the local bodegas now that don’t have the angel investors that these guys have.”

Here's why people are mad about 'Bodega'

Paul McDonald, one of the Bodega’s founders claims the company name was thoroughly vetted and was not met with any resistance by the Hispanic community.

McDonald told the Guardian that the company surveyed those who live in relevant areas to see if the name was an issue. The survey asked “(If the) Latin American community… felt the name was a misappropriation of that term or had negative connotations” and said 97% said no.

There also is some question about Bodega’s business model which does not compensate locations (such as a health club) for placing the unit in their facility. The new company’s logic is the autostore is a benefit to the location and acts as a customer draw.

Beyond the possible racial implications, there’s a matter of possible wiping out the countless small convenience store businesses that rely on local customers. Organizations that support local retailers are upset over Bodega’s rollout which depersonalize the relationship between a community and neighborhood businesses.

“It’s about having neighbors in your community who know you, who have lived there and been in business for a long time, who have seen changes in the neighborhood and are responsive to customer’s needs,” said Trisha Chakrabarti, senior program and policy manager at Mandela MarketPlace. “That kind of personalization of service, you will never be able to find with an automated service.”

It’s worth noting that the concept of providing last-minute necessities is not a new idea. Catering to the immediacy of meeting a consumer’s specific needs on the spot in itself is not a bad idea and there are many successful applications in place. Many hotel chains offer pantries which stock food, hygiene products and even clothing for travelers. Airports now have vending machines that dispense handheld devices, headphones and other gadgets for fliers in need. The trend for taking vending machines from being unhealthy snack purveyors to appliances that focus on health and convenience has been in place for the past several years.

Whether it’s the name, the terrible PR job that surrounded the Bodega announcement or the world growing tired of Google millionaires thinking they have the next great idea, there’s a lesson to be earned here—market research is a multibillion dollar business for a reason.

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