Is Amazon planning further pushes into the brick-and-mortar world?
Global Ecommerce kingpin Amazon has toyed with brick-and-mortar retailing in the past. For many, this seems like a backwards step, particularly since Amazon is itself one of the major disruptors of offline retailing. The company is literally famous for putting the ‘small independent bookshop’ business model out of business.
But looking at Amazon’s offline plans as a step backwards is failing to understand Amazon’s bigger picture: in the same way that Amazon came to help define what we commonly call Ecommerce today, the company is planning to innovate and disrupt retail even further by blending online and offline channels in a powerful, omnichannel, retail expansion.
In the last 12 months, Amazon is up 43%!
SOURCE: Yahoo Finance
Amazon’s two most obvious forays into offline retailing – Amazon Go, and the Amazon Bookshop – are the best place to look for clues as to how the company approaches the world of brick-and-mortar. And, of course, they’re not really ‘offline’ at all. One of the most powerful things about Amazon is that it realizes that almost no retail is really offline anymore, and looks at ways to tighten up the parts of the process that others miss.
Take the Amazon bookshop, for example. Sure, it’s brick-and-mortar, but there’s no way you could sensibly describe it as an ‘offline’ business. It’s a physical extension of Amazon’s online retail offering. All of the books sold at the shop will be available on its site – which has a secondary, and in this case, far more prominent, use as a review aggregator search engine. Does it make its own, bestselling, self-published author work available? Does it sell kindles, thereby bringing new readers fully into the Ecommerce-for-books world that it created and still owns almost exclusively? Of course, the answer is yes.
According to the New York Times, Amazon’s latest brick-and-mortar plans include a furniture and home appliances shop. Just like its other brick-and-mortar concepts, this store will not be a step backwards into physical retail, but a step forward in the wider retail environment. Appliances and furniture are things that people tend not to buy online – they like to examine them firsthand. And Amazon’s new stores may allow shoppers to experience their prospective purchases within their own home, courtesy of virtual reality technology, before ever leaving the shop.
It’s worth noting that Amazon itself has declined to comment on the Times’ article; and that the company routinely plays with hundreds of ideas that never see the light of day. But, true or not when it comes to furniture and appliances, it can’t be denied that Amazon is taking the world of brick-and-mortar seriously. Perhaps dangerously so, for some of the names on the high street!
Dominion holds Amazon in its Global Trends Ecommerce Fund.
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