Paying with the palm of your hand

Amazon is introducing its innovative Amazon One palm scan payment system to grocery chain Whole Foods after trying it out in its Go shops. Amazon sees selling the technology to third-party companies as its next step.

Amazon (AMZN) announced on Wednesday that it is expanding its Amazon One payment system into Whole Foods shops in Seattle.

Amazon One technology was introduced by the company last September and, according to Amazon, it "makes the payment process easy and fast". Unlike Amazon Go's predecessor technology in its eponymous shops, consumers don't have to hold up their phone with the company's app, but hold their palm over the turnstile for less than a minute to scan. Although the two technologies can work together and are used in tandem in Amazon Go shops, according to the company.

Amazon says data privacy is high and believes palm scanning technology is more sensitive than other biometric alternatives such as facial recognition. According to the company, the data is encrypted and stored in a secure 'purpose-built cloud', in addition, the data is never stored on the Amazon One device itself.

Amazon plans to sell the technology to third parties, last year the company said it was in "active discussions with several potential customers", but in yesterday's press release it did not name any yet.

Expert opinion

Market analysts have yet to see significant growth in the segment that includes sales at Amazon Go and Whole Foods Market, although the grocery chain was acquired by Amazon in 2017 for a hefty sum of more than $13bn. From then until the end of 2020, this Amazon segment is the smallest and weakest growing.

The best solution, according to the expert, is a hybrid shop format that has a department for retail customers and an internal warehouse to automate the fulfilment of online orders.

Amazon is known for its ability to identify and meet customer needs. Perhaps with regard to Whole Foods and its Go shops, Amazon should separate its sales 'channels' and define a development strategy to improve service and efficiency.