http://www.engadget.com/2014/10/09/amazon-store-manhattan/
Seems unnecessary. I guess Amazon is getting so bored making money in sane ways that they want to lose money in insane ways.
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.
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.
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.
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."
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.
???? 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.