Amazon and the store of the future / Amazon y la tienda del futuro
Also curious about how Amazon got so big and successful? I was!! And wanted to see and hear firsthand about their story. On 8th of February 2018, ESIC Barcelona organized a seminar about Amazon called ´Amazon and the store of the future´. The speaker was Andrés Núñez Mir who is the Director of ´Ready Tail´, a consultancy in buying experience, sales productivity and strategic planning in retail. He is also Director of ESIC Retail Marketing Program, and a Customer Experience Management Specialist, and in shopping science.
One of the secrets learned why Amazon got so successful, is that they kept expanding business and product offer. In the beginning they just started selling books, then DVD and music and then offering more product categories. Amazon knew already from the beginning how important data analytics was as they measured the behavior, completed purchases and even measured searched keywords from their visitors on the website. Through data they found out what customers want and how they wanted it and this is the reason why Amazon has a big range of products. Big data was already a big thing in Amazon´s business.
Time is changing and they quickly realized that today customers want convenience and fast service from the comfort of their chair whether at home or in the office / at work. The 80 / 20 rule was definitely applied here. Amazon concentrates on the biggest clients that make up for 20% of their total market by providing 80% of their total stock to these 20%, thus offering products that are wanted and consumed by the 20%. This rule is vital whether you are in retail or e-tail (eCommerce). Always have a niche market and keep investigating and getting to know your niche market.
Just like in retail in eCommerce the buying process works as follows; you get stimulated, then you purchase and you will experience your purchase. Before, the stimulant was by TV commercials or mouth-to-mouth, nowadays is a Youtube video or Instagram or other social media post. Based on how you experience the purchase you will recommend it or not to your family, friends etc. in the old days. Now, you just post a review online, which is for all to see. Amazon obviously implemented that in their system, as online buyers can leave reviews on the website. This can be a good thing and a bad thing. Let´s focus on the good thing, because when you take into account SEO, Amazon is well positioned, a product search in a search engine can easily show you results of Amazon. Having billions reviews for thousands of products on their website, is a good strategy to get more traffic and leads.
Amazon also understands that being physically available will boost business. They have ´Amazon Books´ for those who enjoy reading and doing so in a book store, ´Amazon Whole Foods Market´ for wholesales, ´Amazon Pick-up´, and now experimenting with the concept ´Amazon Go´. So how will the store of the future look like? Amazon Go is the store of the future! There are a few Amazon Go stores, there is one in Seattle in the United States, and they are in a trial phase before going all the way public. This concept is designed for those who want to shop quickly and conveniently. You only have access to the store with the mobile app that you have to download. With the QR code in the app you scan at the portal´s turnstile which grants you the access.
The app does not only contain all your details and payment details, but also that of the particular Amazon Go store and its products. Via artificial intelligence (AI) the app tracks every product you take from the shelves and adds that automatically onto your shopping list. When you put an item back, the AI receives that and recalculates your shopping list. Once you finished taking products, you can just go out of the store, and the app will process your payment automatically. Basically you go into the store, take what you need, and then exit! It is all well secured and controlled.
With this concept Amazon shows how it understands the needs of the consumer to offer comfort and convenience and using technology in their favor to do so. Technology is the future; one should always be aware how technology influences every aspect in our lives nowadays. Another technology adopted by Amazon is their delivery drone designed by ´Starship´, which is a small car robot that delivers online purchases.
In short, the four secrets to have a solid eCommerce business as learned from Amazon:
- - Keep expanding business
- - Apply the 80 / 20 rule
- - Include review section on your website, good for SEO too
- - Embrace technology into your business
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