Amazon started their journey, and the first thing they did was taking over the bookstores. Then, they nullified the electronic shops (they did try it) and then revolutionized the market with Amazon Fresh and Amazon Prime. Now with Amazon Go, they want to fiddle with the way Grocery stores work.
There’s a catch
Amazon has been a customer-centric company, which has more than three decades of experience in pioneering innovations. And their tagline “No lines. No checkout. No, seriously.”Is too good to be true, given the rapid growth of Omni channel shopping. So, I hope they will play it safe, really safe, even if it means low SKU counts. They will do fairly good and avoid the Click and Collect grocery business model and will successfully cater to the impulsive, fascinated millennial buyers.
But what exactly is Amazon trying to do?
Well, I am sure about one thing, they are inspiring a Jarvis of supply chain management, focusing on all sorts of customer data, which will help them in broadening their supply chain management by understanding the consumer buying pattern. This understanding will be used to offer a seamless shopping experience to customers.
What is at stake?
Surely, it is the customers. See, you must understand this, being a customer-centric organization, Amazon has always come up with the best deals during the festive seasons. And with Amazon Go, they have introduced the customers to a Pandora box, and what we can do is just assume. The best part of Amazon is that it always hits a bull’s eye because it understands its target audience and their pain areas.
So, what Amazon Go has done is that, it took out the headache of long queues, eliminating the trouble that more than 75% of customers have to go through while shopping for groceries.
Grocery stores have a different way of working (until Amazon come up with teleportation technology), people do need to feel and see the product themselves. And for that, moving to a brick and mortar store is the option Amazon opted.
The question remains that why a company which focused on making its online presence felt, suddenly will branch out and move beyond virtual presence? Well, it’s fair enough, you see, Amazon has always been a smart player and right now it is reinventing smaller store model where it’s all about convenience and customer supremacy.
Amazon is also keeping this fact in mind that it has huge competition when it comes to the grocery. I can bet on the fact that they are trying to establish themselves at par with the competition. In the retail market, Amazon has 300 million customer base which it did by capturing a slight percentage of overall retail sales but big shares in certain categories. For now, Amazon is into selling perishable products, so what it actually doing is shifting the operational feature of a grocery store, beginning with perishable commodities that are frequently bought by consumers.
If you sit back and think about this strategy, Amazon knows that almost 50% of grocery is spent on perishable products. So, rather than changing the consumer behavior of buying these perishable items, Amazon has reached out to them by offering a much needed physical store experience.
Smaller store footprint and a hassle free checkout systems are likely to be preferred by consumers. More and more people will start frequenting Amazon as it also offers prepared food.
Amazon has begun it all over again, and as they did it with books, they are going to do with grocery. The plus point in their strategy is the personal touch. For now, we have to wait and watch. And yes, when you visit Amazon Go, remember what Russell Peters always says in his standup acts – “Just Take It And Go!”