The Amazon age: how retailers can strike back

19th Aug 2019

Today, we’re living in the Amazon age. Consumer expectations have been forever changed by online giants that have built ease, immediacy and convenience into the core of their propositions. Everything is now instantly accessible, on-demand and from the touch of a smartphone – content via streaming services such as Netflix and Amazon Prime, professional health advice via apps such as the NHS App and Ada Health, and food via delivery services such as Just Eat and Deliveroo. In the Amazon age, things happen where the consumer is and when they want it.

This is no more evident than in the retail sector. Traditional bricks and mortar retailers, some of which have thrived for more than a hundred years, survived two world wars and a couple of economic crises at least, are falling fast in the face of the Amazon age. Each week, the household names we’ve known and loved are shutting stores, cutting staff or, worst of all, entering liquidation.

The struggle is real

One of the key problems is that Amazon has the monopoly across so many categories of goods: tech, home, fashion, electronics, toys etc. And it has created an online store that is built on immediacy, making it truly harmonious with consumers’ time-poor lifestyles. And worse, it has made it look easy. In fifteen years, Amazon has overcome a plethora of challenges that it faced in its infancy and is now putting high-street retailers trying to attract online customers on the back foot. Amazon is who these retailers are fighting for market share.

This has put severe pressure on traditional retailers to quickly set up shop online. Amidst the race, some retailers have taken aspects of what has worked offline and tried to copy and paste that into their shiny, new online environments. In fact, some traditional bricks and mortar retailers have relied on brand affinity – hoping that heritage and brand image would drive people online in the same way it once drove them into their stores. However, that doesn’t seem to be enough anymore. Amazon itself has been subject to ever more public scrutiny following corporate tax scandals and questionable product selections - it’s apparent that it’s not heritage or brand image that’s driving people to shop with them. Rather, in the Amazon age, the value of brand image is losing out to immediacy and convenience.

Traditional bricks and mortar retailers need to realise that what gets people through the door won’t necessarily get them visiting their online stores. And while the physical and digital footprints of a retailer have to complement each other as part of a cohesive omnichannel strategy, both need to evolve in line with consumer demand. Luckily, the Amazon age has inspired a generation of tech start-up businesses who understand the importance of updating these two shopping environments in driving purchases. Companies such as Klarna are allowing consumers to “try before they buy” with the ability to delay payment for a month. While NearSt uses real-time data so consumers can see which products their local high-street stores have in stock before they pop out.

But all hope is not lost

Bricks and mortar retailers need to think the same way. Most retailers have realised that an online presence is critical if they are to weather the storm that’s hit but, critical to their success will be treating their online stores differently to their offline environments. What cuts it in the real world might not cut it in the virtual world as online shopping is governed by a completely different set of rules. For example, while window displays are vital in catching the consumer’s eye on the high-street, a high SEO ranking is critical to online success. In physical stores, there’s a huge emphasis on store layout, minimising queues and friendly and informative service from store clerks while online, the critical factors driving purchase behaviour could be page load times, an easy to navigate website and a simple, cost-effective returns process. The very nature of online shopping means that what happens after customers have left the checkout is as important as the checkout process itself – something that Amazon knows well.

For example, the company completely reimagined its customers’ experience on the site through its “one-click checkout”, saving customers the chore of manually inputting payment details and its “Prime” service which provides customers with next-day delivery. Tremendous take-up of the service proves that convenience wins every time and caused Amazon to roll-out “Prime Now”, in which products can be delivered as quickly as an hour after placing an order. Its business model has not only capitalised on consumer behaviour but driven it and now, rapid convenient delivery has become the new normal that all retailers have to contend with.

Moreover, Amazon Prime showed that the key to transforming traditional retailers’ position in the Amazon age will be delivery. The right delivery models can power the level of immediacy and convenience that consumers crave - a commodity customers are willing to pay for. In fact, 40% of consumers are willing to pay premiums for same-day or instant delivery. Retailers must offer solutions which empower these two modern day necessities in order to put up a fight against the internet giants.

A new age

It’s clear that if high street retailers want to thrive in the Amazon age, having a positive brand image and a physical presence on the high street is no longer enough. High street retailers need a carefully constructed omnichannel strategy, comprised of marketing, delivery logistics, apps and physical stores as well as access to the right partners and technology which are all perfectly aligned to serve the consumer in the best way possible.

Amazon truly ‘gets’ what consumers need – and they need it now! Its business model has not only capitalised on a shift towards impulsive shopping behaviour, but driven it and now, the Amazon age has made convenience and immediacy the new consumer must-have. Failure to put these qualities first in any retailers’ online proposition will see the prophecy of a dying retail industry come true in 2019.

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By Binfiction
16th Sep 2020 15:20

2020 has shown the true power of e-commerce, particularly in the case of Amazon, which has grown exponentially in the context of this entire global situation. It seems like starting a business on Amazon is truly worthwhile.

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