Can Big Retailers Use Amazon and Win?

Simon Eskow Retail Articles Leave a Comment

You read about Amazon on a daily basis. We talk about it a lot here, too. After all, Amazon occupies a unique position. First, it became to online selling what Google became to search engines; it’s woven in the fabric of multichannel commerce. Beyond that, however, Amazon runs a cloud business, a logistics system, even a TV network, in a manner of speaking. In fact, one might say those latter offering combined to make Amazon such a disruptive force in commerce. Today, even big retailers use Amazon, or at least work with the giant, to make the disruption work in their favor.

Retailers Use Amazon in Different Ways

Retailers make Amazon work for them in a few ways. Smaller retailers can use Amazon to reach more customers to make more sales and broaden their reach. Big chains, on the other hand, occupy a niche directly threatened by that particular marketplace. Thus, how big retailers use Amazon demonstrates their ongoing struggle to rationalize their supply chain model. Ultimately, it boils down to the purpose of a big chain’s investment in big physical spaces.

Free Amazon Returns Service

Ultimately, retailers have to give customers good reasons to come to their stores. This can be any combination of a unique shopping experience, product expertise, niche products or click-and-collect incentives.  Now, the department store Kohl’s wants to give Amazon customers reasons to visit. The company intends to handle returns of Amazon items at 82 Kohl’s stores in two test markets. The move appears to underscore convenience. First, a free return service relieves Amazon customers the task of re-packing an item and arranging a courier. Secondly, Kohl’s will reserve parking for those Amazon customers near the store entrance. The best parking space and a free service could increase foot traffic, spontaneous purchases, and higher customer loyalty.

Amazon Products in Stores

If Kohl’s and Sears start selling Amazon devices, do these retailers use Amazon to bring in customers? Or does it represent is it a defeatist strategy made out desperation? Along with its returns service, Kohl’s plans to set aside space in 10 stores to sell Amazon devices and services. The company has been reducing inventory to keep carrying costs down. Thus, space they could use to sell now goes to their biggest competitor. Meanwhile, Sears over the last few months took steps to work more closely with its online rival. For instance, Sears began selling its appliance house brand, Kenmore, on Amazon . At the same time, it began selling Amazon devices in its stores. It’s unclear how this helped the ailing chain, but critics see it as too little, too late.

Will Australian Retailers Use Amazon?

Big retail suffers its particular problems in adapting to the multichannel world. In a way, smaller retailers have it a little easier. Specifically, they don’t have to worry about the costs of maintaining huge spaces as their big box counterparts do. They also do not compete with Amazon in the same way as retail chains. In fact, many smaller retailers use Amazon already to sell more and build their brand.

If you’re a retailer in Australia, Amazon probably looms in your thoughts. Amazon Australia will start selling in time for the Christmas season, in all likelihood. The question is, are you Amazon-ready?

Come along to our upcoming breakfast conferences and learn. Hear from experts who will shine a light on how to make Amazon a part of your retail business. Click below on the conference near you to register and learn more.

Rydges Melbourne, 11 October,  7:30 AM – 9:30 AM, with Jo Munro, the Savvy Shopaholic

Rydges Sydney Central, 12 October,  7:30 AM – 9:30 AM with Nick Lavidge, Alley Group

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