Smart Retail, Replaces All? Some? : Different Influence of Amazon Go to Local Restaurant Industry.

Date
2022-01-04
Authors
Choi, Jooyoung
Lee, Chul Ho
Ceran, Yasin
Chung, Sunghun
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Amazon Go, the pioneering smart retailer, has been opening physical stores in metropolitan areas of the USA, and seductively distracted customers from adjacent competitors by provisioning quick-and-easy service. This study focuses on how the appearance of the smart retailer affects adjacent competing businesses. We constructed a panel dataset with various features and reviews of restaurants from Yelp.com, and created two dummies, ๐ด๐‘‘๐‘—๐‘Ž๐‘๐‘’๐‘›๐‘ก, one if the restaurant is in a certain radius of a smart retailer and zero outside, and ๐ด๐‘“๐‘ก๐‘’๐‘Ÿ, one after the introduction and zero before. By using Difference-in-Difference estimation, we find that (1) negative impacts on the adjacent restaurants after Amazon Go compared to non-adjacent and before the appearance, and (2) less negative impact on adjacent fine-dining restaurants than fast-food restaurants. After Amazon Go, customersโ€™ sentiments about the adjacent restaurants have changed more negatively. This paper may provide businesses with useful implications for their strategies.
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Digital Platforms and Industry Transformation, complement, difference in difference (did), smart retail, substitute, yelp
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10 pages
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Proceedings of the 55th Hawaii International Conference on System Sciences
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Attribution-NonCommercial-NoDerivatives 4.0 International
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