Tuesday, January 31, 2017

Amazon.com Plans First Air Cargo Hub

Retailer expects facility at Cincinnati/Northern Kentucky Airport to create more than 2,000 jobs

LAURA STEVENS

Updated Jan. 31, 2017 7:56 p.m. ET

Amazon.com Inc. said Tuesday it plans to build its first air cargo hub to accommodate its growing fleet of planes, signaling the company is ramping up its expansion into transporting, sorting and delivering its own packages.

The Seattle-based retailer said it expects the new air hub, located at Cincinnati/Northern Kentucky Airport in Hebron, Ky., to create more than 2,000 jobs. The move will lessen its dependence on traditional carriers, including United Parcel Service Inc. and FedEx Corp., both of whose largest hubs are nearby.

Last year, Amazon said it was planning to lease 40 cargo planes, 16 of which are currently in its fleet. It also brought on a dedicated network of 4,000 semi trailers to increase trucking capacity and has a fleet of citizen courier Flex drivers making deliveries in major metro areas.

Amazon’s goal is to eventually haul and deliver packages for itself as well as other retailers and consumers—making it a direct competitor with UPS and FedEx, according to people familiar with the matter. The air cargo hub follows Amazon’s recent ocean debut, handling shipment of goods by ocean to its U.S. warehouses from Chinese merchants selling on its site, taking on a role it previously left to global freight-transportation companies.

Amazon’s plans call for around $1.5 billion in investment and upward of 2 million square feet, said Dan Tobergte, CEO of the Northern Kentucky Tri-County Economic Development Corporation. He’s trying to secure $40 million in incentives for the project, which he expects to break ground as soon as needed approvals are received.

The investment is expected to eventually include several buildings, material-handling equipment and a place to park airplanes, he added. Amazon didn't say when the air hub will open.

Amazon’s announcement could foreshadow “significant further investment in air-cargo logistics infrastructure,” adds Robert W. Baird & Co. analyst Colin Sebastian in a note, eventually leading to Amazon becoming a competitor in the freight and logistics market and shipping packages for third parties.

Still, Amazon’s relatively new transportation network is currently dwarfed by traditional carriers like UPS and FedEx. UPS’s largest air hub, Louisville, Ky. ’s Worldport, employs nearly 10,000 people, for example, and the delivery giant’s world-wide air fleet totals more than 500. That hub has the capacity to sort about 416,000 packages per hour and is about 5.2 million square feet.

It appears—for now—Amazon is more concerned with shoring up its own volume to ensure it has enough capacity during busy times like the holidays than competing with the carriers, analysts said.

Amazon’s airport location choice means it will be neighbors with Deutsche Post AG’s DHL, a major provider of international shipments to the e-commerce giant. DHL also has a big hub at the Cincinnati airport. That could facilitate transferring shipments between planes and further lessen Amazon’s dependence on UPS and FedEx.

The online retail giant already has a large presence in Kentucky, with 11 fulfillment centers in place there in part due to the area’s central location that enables it to act as a logistics hub.

The location chosen by Amazon is within about a two day’s drive of a significant amount of the U.S. population, said Jack Atkins, a transportation analyst with Stephens Inc. “It makes sense that Amazon would want to build something that fits their freight and how they view their logistics needs,” he added.

The site’s new jobs may count toward the 100,000 jobs Amazon pledged in early January to create in the U.S. by mid-2018.

Ocado trials fruit-picking robot

By Zoe KleinmanTechnology reporter, BBC News

Online grocer Ocado has shown off a soft robotic hand that can pick fruit and vegetables, without damaging them, in its warehouses.

The firm has an automated warehouse in Andover, Hampshire, where robots select crates containing specific items that make up customer orders.

They are currently brought over to a human team for selection but, in future, the hand could replace them.

Also in development is a humanoid maintenance robot called SecondHands.

It will work alongside a human colleague to maintain the warehouse.

Second Hands the robot maintenance technician — Image captionSecondHands, the robot maintenance technician, with its human colleague

The fruit and vegetable picker is part of a five-year research EU-funded collaboration between five European universities and Disney called Soma (Soft Manipulation), said Ocado spokesman Alexandru Voica.

The demonstration device is an early prototype, he said.

"People have tried suction cups, robot hands with three fingers... What we are trying to do is to actually mimic the human hand.

"The gripper is based on air pressure, which controls the movement of the robotic fingers.

"What we are trying to do is combine computer vision - being able to recognise products by looking at them - with the control aspect which is the gripping aspect."

At the moment, only the gripper is being demonstrated but ultimately the robot will learn to distinguish fruit ripeness through machine learning.

It will also be able to pick other items which require different care - such as wine bottles and detergent.

"Fruit and vegetables are the hardest to pick," said Mr Voica.

"When the customer gets their bag of bananas or tomatoes, if they see the product is damaged they don't care whether it's a human or a robot that's picked it."

Image captionThe robot warehouse contains crates containing various goods which the robots select

Prof Chris Melhuish, director of the Bristol Robotics Laboratory, said that building robotic devices - or manipulators - to carry out multiple tasks is difficult.

"A general purpose manipulator is a really tough thing to build, and certainly understanding and exploiting the way the human hand functions, because it is so flexible and adaptive, makes a lot of sense," he told the BBC.

"There are lots of groups that are looking at robotic manipulation but often it is for a specific purpose - picking up a concrete block is not the same as doing artificial suturing for example - so the tendency has been to build different types of manipulators for different domains."

Starbucks unveiled a new third-party skill for Amazon Alexa this morning, letting regular customers reorder their favorite coffee and food by saying “Alexa, order my Starbucks” to a device powered by the online retail giant’s voice-enabled personal assistant.

Also this morning, Starbucks started a limited beta rollout of the previously announced MyStarbucks Barista chatbot ordering feature as part of the Starbucks app for iOS. It uses artificial intelligence to let customers order and pay via voice. Starbucks says the MyStarbucks Barista feature will be available only to 1,000 customers nationwide initially, before rolling out more broadly over the summer. An Android version is expected later this year.

Starbucks’ new Alexa skill was quietly rolled out a few weeks ago, according to the date in the Alexa Skills marketplace. It works via the Starbucks Mobile Order & Pay feature, which lets customers place and pay for an order in advance and pick it up at a nearby Starbucks store without waiting in line.

With the new Alexa skill, customers designate their “usual” Starbucks order in advance and can then place the order from one of the most recent 10 stores they’ve ordered from, using their voice with an Amazon Echo or other Alexa-enabled device.

It’s a notable partnership between the two Seattle-based retail and technology titans. Amazon and Starbucks are likely to cross paths more as Amazon launches new physical retail stores, and Starbucks goes increasingly digital. Separately, at the Starbucks headquarters complex south of downtown Seattle, Amazon has established a distribution center and is developing a mystery drive-up project, according to planning documents previously uncovered by GeekWire.

Gerri Martin-Flickinger, Starbucks’ CTO. (Starbucks photo)

On its earnings conference call last week, Starbucks said Mobile Order & Pay represented 7 percent of the company’s U.S. transactions in the most recent quarter, up 3 percentage points from the prior year. The feature has been so popular, the company said, that it’s clogging pick-up areas and forcing the company to consider revamping its new store designs.

“The Starbucks experience is built on the personal connection between our barista and customer, so everything we do in our digital ecosystem must reflect that sensibility,” said Gerri Martin-Flickinger, chief technology officer for Starbucks, in a news release this morning announcing the new voice technologies.

She continued, “Our team is focused on making sure that Starbucks voice ordering within our app is truly personal and equally important was finding the right partner in Amazon to test and learn from this new capability. These initial releases are easy to use providing a direct benefit to customers within their daily routine and we are confident that this is the right next step in creating convenient moments to complement our more immersive formats. We expect to learn a lot from these experiences and to evolve them over time.”

Monday, January 30, 2017

Target plans to introduce its own smartphone payment service in stores later this year

Shall we call it Target Pay?

BY JASON DEL REY@DELREY JAN 24, 2017, 10:46AM EST

Shoppers will be able to use their phones to pay in Target stores later this year, but it won’t necessarily be with Apple Pay or Android Pay.

Instead, Target plans to introduce mobile payment features to one or more of its own apps, the retailer’s Chief Information and Digital Officer Michael McNamara told Recode last week at a National Retail Federation conference in New York City.

It’s not clear if Target will add the payment feature to its main Target app, its popular Cartwheel coupon app or both. A spokesman declined to comment further.

Target will be following in the footsteps of other big retailers like Walmart and Kohl’s who have added mobile payment features to their own apps over the last year, in the wake of offerings from Apple, Google and Samsung. All three of the big-box stores had originally backed a separate payment app, CurrentC, but it never launched widely.

In the case of Kohl’s service, Kohl’s Pay, shoppers can use the app to both pay and earn rewards points with a single scan at checkout. McNamara said it would make sense for Target to offer store shoppers a way to both pay and use a digital coupon in one step.

McNamara said the Target payment service will only be available to shoppers who have a Target REDcard — “at least initially.” REDcards are debit or credit cards that come with perks like 5 percent off Target purchases and free shipping on online orders.

Apple Pay is a payment option for online purchases in the Target app. But it’s not a payment option in Target stores.

Sunday, January 29, 2017

The Rise of New Retail Models

As industry evolves, so too, does the definition of ‘progress’

January 25, 2017, 05:15 pm By David Diamond

Winn Dixie, 1967. Photo courtesy of Pleasant Family Shopping (pleasantfamilyshopping.blogspot.com)

A variety of entrepreneurs have taken credit for the invention of the supermarket in the late 1920’s and early 1930’s. I will let the various historians and marketers stake their claims (for the record, the FMI recognizes Michael Cullen’s first King Kullen store in Queens, New York in 1930 as the first supermarket, but others, using different criteria, disagree), but what seems clear is that the combined pressures of modernization and the great depression moved retailers to move from a high-service, goods behind the counter environment to a more diverse, self-service model. By the end of World War II the self-service model had established itself and become the standard approach for modern retailers.

The remarkable thing is how durable this model has been. While it is true that much changed in the retail world between 1945 and 2005, the essential model of each store becoming larger and more self-service continued unabated. Over that 60-year period stores became bigger, came to include more categories, and asked their customers to do more and more of the work, all in exchange for offering a greater variety of products and significantly lower prices. These trade-offs were generally quite appealing to consumers, who liked the convenience of one-stop shopping and loved the significantly lower prices offered by stores as they grew in size.

But starting around the turn of the last century, a variety of changes started to change the retail model in very fundamental ways. And for the first time in many years, we are now looking at changes in the retail landscape, which not only build on the current model, but also undermine it in certain ways. I recently spent some time at the NRF trade show in New York City, and was struck at how some of the proposed new products for retailers didn’t just move the process of innovation forward but actually changed its direction.

An important place to begin this discussion is to recognize the reappearance of smaller, more specialized stores. Across the country, one-stop shopping is beginning to fade, as shoppers supplement their primary supermarket shopping with visits to the Farmer’s Market, the local Butcher and other specialty stores. In the last 20 years, the momentum has shifted away from the consolidation of all departments into the giant mega-store and towards the appreciation of the value of specialists -- great farmers, butchers, bakers and artisanal craftspeople of all kinds. I may still go to the supermarket or super-center for canned tuna and laundry soap, but I may look elsewhere for homemade bread and local seafood.

Return of Specialty Stores

However, this return of specialty stores is just the beginning. Once consumers begin to look beyond the mega-store for everything, many options arise, and the advent of e-commerce plays neatly into this instinct. It has taken a long time for e-commerce to make significant inroads into the grocery business, but that dam seems about to break in a number of ways.

First, the two biggest issues related to “internet groceries” are very effectively solved by the “click and collect” model now becoming popular. Since the first manifestations of online groceries in the mid-1990s, the two biggest hurdles to mass success have been the cost of home delivery and the desire of consumers to select certain goods themselves. They may trust their grocer to select Pepsi, but they want to pick out their own steaks. Click and collect solves both of these problems. The customer pick-up greatly reduces the costs while allowing the consumer to reserve a few items for self-selection. It appears that this model has some real momentum and could be the long awaited way to make Internet grocery ordering a mainstream activity.

Beyond click and collect, there are a variety of other new, technology driven approaches, which leverage both technology, and the emerging willingness of shoppers to buy different things in different places. Foremost among these is Amazon Subscribe and Save, which allows the consumer to identify the few items they know that they want every month, and “subscribe” to them at a discounted rate. I have done this for about six items, and I have become a real believer in the approach, especially for hard-to-find items.

At the NRF show, I saw an even newer technology, being offered by a company called SmartCommerce, which allows product manufacturers to embed in their ads a click through button, which directly deposits the advertised product into the shopping cart of the consumer on the consumer’s preferred e-commerce site, cutting about three steps out of the ordering process. It is another approach that serves to drive consumers away from “one-stop” shopping and toward “best of breed” shopping, by product and by category.

New Definition of 'Progress'

And this is all just a sampling of all of the various new ways of shopping. The point is not to discuss them all, but rather to comment on the reality that the definition of “progress” has really changed.

From 1945 until about 1995, “progress” in retail could be measured along a straight line from small stores to big stores, from smaller assortments to larger ones, from fewer departments and categories to more departments and categories. From the first King Kullen to the latest Walmart Supercenter, progress has manifested itself in far more diverse ways, including new stores, specialized stores, web-based stores and hybrid retail models.

The critical take-away is that not only does retail continue to evolve, but that this evolution has become a more diverse, disorganized process.

Dollar General Debuts First DGX Store In Nashville, Another To Open Soon In Raleigh

Posted by Kristen Cloud

Date: January 26, 2017

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