Amazon to Open First Brick-and-Mortar Location
online.wsj.com
online.wsj.com
Seems unnecessary. I guess Amazon is getting so bored making money in sane ways that they want to lose money in insane ways.
Apple's flagship Manhattan store famously does quite well as a showcase for their products and helps to sell millions for them. Amazon could be doing that math that for every user we get into the ecosystem we can extract X in lifetime value from book, video and app purchases (again a way it could make sense).
Also, you can consider this maybe Amazon trying to become Walmart faster than Walmart can become Amazon. Having physical stores still counts for much in the retail sector, having one (or a bunch) would potentially give them leverage and more options. They _already_ have a massive nationwide system of warehouses and logistic centers, is it that crazy that they could move products into brick and mortar shops as well as the presumably much more complicated process of people's homes?
If I wanted to pick up packages, I'd go to stores and buy things. I don't want to go to the store though, so I pay Amazon to deliver it to me.
What it comes down to for me is, I don't hate going to the store, I hate shopping at the store. Typing "16GB USB Drive" into the search box is much easier than wandering down multiple aisles trying to figure out whether that particular store put the USB sticks with the laptop accessories, the camera storage, the office supplies, on some unrelated endcap, or behind the guy standing inconveniently in front of the display I'm trying to look at.
And don't forget, the costs can be much lower when using parcel machines. For example in latvia ,it costs 2 euro to send a package from a postal machine to a postal machine, versus 3.6 euro from a postal machine to someone via courier.
And e-commerce users really hate to pay for shipping.
Based on store counts times conservative numbers on the total cost of a new Wal-Mart. They might try building a bunch of small stores, but they're definitely not going to try to become Wal-Mart.
In other words you no longer 'go to the store' because it's economically inefficient to store many units of the same thing on expensive prime real estate. Instead almost all the warehouse space of existing stores is turned into floor space and they only have 1 of each item, although they keep a small stock of consumables.
http://services.corporate-ir.net/SEC/Document.Service?id=P3V...
So perhaps it would have been more accurate to say "getting so bored expanding into new markets."
???? I would expect they are only going to stock amazon stuff. Maybe amazon branded + amazonbasics.
Why would they stock anything else?
To me, this seems like a fairly obvious play: They have had trouble getting playing with fire branded stuff in their internet and tv-only campaigns. People actually want to play with the devices.
Given the choice between buying space in best buy among tons of other companies, and leaving it to the whims of blue shirted people to sell their stuff, or doing it themselves, they chose "doing it themselves".
That seems sane to me.
Supply chain for a warehouse is different than supply chain for the store. If too many people in alabama want something tomorrow that isn't in alabama warehouse, they overnight it from vegas and pay the price. If too many people show up to buy something in the store in alabama, they are simply out of stock. In one case, they make a sale and pay a little more overhead. In the other case, they probably don't make the sale.
Additionally, right now their support is limited to "we click buttons, you repack stuff, and we ask UPS to take stuff back to us". The average brick and mortar store provides a lot more support than that.
They already deal with a lot of this for kindle products, but not other peoples.
For other people's products, I can't see them wanting to get into this business, it's a rathole, and only serves to help others more than them :)
I don't think they will get into the business of selling tvs in a big box, for example, right up until best buy dies. I think they are perfectly happy with "people try stuff, then buy it on amazon", and i don't see why they wouldn't be.
In short, i have trouble seeing why they would want to be a big box in the future. Their entire business model is based around the idea that being a big box is inefficient.
On the other hand, that would make them nearly equivalent to any of the other "brick and mortar" businesses. I wonder if they want to focus on showcasing their own products, like an apple store. They have been pushing the advertising on amazon fire TV and phone a lot.
http://www.marketwatch.com/story/amazon-to-open-first-physic...
I created a small greasemonkey script to set the referrer on all wsj websites to google. Works like a champ!
Gist please!
EDIT: Quick google search found it: http://userscripts-mirror.org/scripts/review/72558.html
TV loves these " people in Manhattan queued all night in front of the store in anticipation of iThingy 15.7 "
If the user base increased by 50% between the two releases, they can convince 50% less people to upgrade the first weekend, and still sell more the first weekend than they did last time. The sold x million certainly tells you some hard dollar number that is uninteresting, but it gives you no idea how popular the device will actually be, even though it sounds like it should.
- They will ride the media wave when a product launches/when they do a stunt like drone delivery and have people waiting outside.
- You can bet they will be testing in-house tracking/advertising by analyzing their customers' actions under their own conditions
- You can bet they will sell at least a small number of their flagship products
Kind of surprising that they didnt already have a brick-and-mortar location.
They are called Argos.
http://girlinlondon.com/argos-inside-one-of-the-uks-most-pec... for a good description.
You went into the local grocers which had a counter/hatch (think post office/bank), You told him what you wanted (or he your weekly order) and he (or usually his boy) would then drop the merchandise off at your house.
The Supermarkets pretty much paid to your corner grocer (economies of scale, later opening hours, more variety of items, the ability to do your shop yourself as and when needed and the increasing wealth of the UK (cars and refrigerators)).
It would be amusing if we went back to a high tech version of that.
Someone has already picked up on the "micro-mall" phrase. They're running a store where merchants rent display space, and they handle the cash registers and stocking for them.
http://thevillageindoormarketplace.com/become-a-merchant/mic...
This is almost certainly not the main intention of this move, since a store is waayyyy more expensive than a locker and no more convenient, and Amazon has had lockers for a looong time (I can't receive packages at my house so I use the locker one block away extensively).
I imagine it'd be great to showcase flash sales and extremely high demand items. I really believe a retailer selling physical goods needs some sort of physical presence and hope this is something interesting.
I can see a Manhattan store working as a novelty type deal but beyond that Amazon is online in my books.
Also, six foot HDMI cables. Everybody needs those.
https://www.youtube.com/watch?v=uGxRg5I7r5s
The future of e-commerce is bricks and mortar (?!)