RetailTechNews’ weekly Amazon Watch brings you some of the company’s biggest moves from the past seven days, analysing how the giant is revolutionising the retail space. In this week’s edition: Amazon launch new AI research hub in Germany; Kindle apps are getting a makeover; Launch of Handmade Gift Shop a blow to Etsy; and Order and pay features set for rollout.

Amazon launch new AI research hub in Germany

Following on from its purchase of Body Labs, Amazon has now announced a new research centre in Germany focused on developing AI to improve the customer experience, with a focus on visual systems. Amazon says research conducted at the hub will also aim to benefit users of Amazon Web Services and Alexa.

The purchase of Body Labs earlier this month was a sign of intent from Amazon, showing that it wants to fully match the in-store experience, online. The technology is used to predict and measure the 3D shape of your customers from a single image, helping fashion brands get the right fit for a customer using a mobile app. This research centre will focus largely on computer vision, which will help with the development of more advanced visual systems, capable of better detection of objects, faces and body posture. This information is then used to supplement the intelligence of AI systems, to enable them to better assist shoppers.

While this is obviously bad news for brick-and-mortar retailers, it will not be welcomed by online competition, such as ASOS, either. If Amazon can implement this technology across its systems, the accuracy with which consumers will be able to purchase clothes online will sky-rocket, boosting Amazon’s customer base as it does so. Smarter visual systems can significantly cut operating costs and user friction.

Kindle apps are getting a makeover

Amazon is launching redesigned versions of its Kindle apps for iOS and Android. The updates include a more accessible search feature and a new navigation bar that helps users jump quickly back to reading.

Users can now also follow and comment on what friends are reading, and get recommendations based on readers who like similar books. With users (especially American users) turning to multipurpose devices, such as smartphones and tablets, rather than e-readers like Kindle, improvements to the Kindle app could be the way Amazon develops this arm of its business.

In fact, the combination of the popularity of multipurpose devices for e-books, and the fact that print books are still more popular than e-books, means that Kindle devices, such as the Kindle Fire, could soon be a thing of the past. However, this isn’t something which will be hugely troubling to Amazon, with its Kindle e-books app the fourth most popular iOS app in the UK, after only Facebook, Messenger, and YouTube.

Launch of Handmade Gift Shop a blow to Etsy

Amazon is tapping into the market for handmade goods, with the launch of its Amazon Handmade Gift Shop. Amazon Handmade first launched in 2015, but the gift shop is focusing on the holiday season.

Seemingly with fingers in every segment of the retail pie, this latest move is seen as a particular blow to Etsy, which specialises in collectables, craft supplies, and vintage goods. The launch of Gift Shop will mean that Etsy has to spend even more on marketing (at this already expensive time of year for brands), in order to stand out from the ecommerce giant. Etsy has already changed CEOs and slashed its workforce by around 22%, and with the news of Amazon’s Gift Shop, shares were down 3% on Monday.

Etsy, the leader in the craft marketplace, has recently struggled with new channels, such as Amazon and Instagram, which are creating alternate platforms for the independent sellers to which Etsy caters. For Amazon, a business which has focused on data and efficiency gains, to make headway in the retail space, the growth of its artisan business represents a change in tack.

Order and pay features set for rollout

The Amazon mobile app and Amazon Pay payments platform will be rolled out at certain restaurants next month, in a move that will allow Amazon customers to order and pay for take-out without the need for extra logins. This process is enabled by a team-up between Amazon Pay and Clover, a POS system used by restaurants.

The app will also store favourite items for customers, allowing them to re-order in two clicks. Amazon reportedly has more than 33 million users of its payment service, with the platform accepted by over 100 online services. Partnerships like this will be crucial to Amazon if it is to make headway in a space in which some of its major competitors, such as Google and Apple, are already well established.

This means that Amazon is in an unfamiliar situation when it comes to expanding its payment services, and is playing catch up with the competition. The big challenge will be striking up relationships with retailers. This is something which could prove tricky, given that big players, such as Walmart, already have their own mobile payment platforms, while others support competitor platforms, and are unlikely to accept Amazon Pay. However, with its well-publicised acquisition of Whole Foods, it is surely only a matter of time before Amazon Pay development gathers pace.