Is there any e-commerce business untouched or safe from Amazon so far? We’ll investigate with this look at what’s new with Amazon business strategies around the world. Amazon has ambitions for the $649 billion grocery industry, although after 10 years it still hasn’t cracked the egg yet. What it likes is the steady frequency of shopper visits for staples. Watch for more Amazon grocery goodies in the future. Venture Beat has a fascinating look at Amazon’s store strategies and what some of its stores could look like in the future.
Amazon plans to hire more than 5000 work-from-home customer service workers and 30,000 part-time workers to support its growing network of warehouses. This is in addition to more than 100,000 full-time US workers announced earlier and to be hired over the next 18 months. It employed more than 341,000 full-time and part-time workers at the end of 2016, up 48% from the previous year.
Amazon’s new e-wallet license in India will allow it to go after the booming payments industry with Amazon Pay, a natural complement to it e-commerce business which it claims is now the largest marketplace in India. Its $5 billion investment in India is also seeing growth opportunities including home services (HomeJoy), insurance (BankBazaar), Amazon Prime, entertainment and cloud services.
Amazon has launched an aggressive effort to convince consumer packaged goods (CPG) manufacturers to sell direct to consumers through its marketplace. Q1 revenue at Amazon reached $35.7 billion and 10% or $3.6 billion was due to its growing cloud services business. Amazon Echo owners can now make phone calls like Skype using the company’s Dialpad cloud-based business phone platform, Adding to the telecom potential, Amazon’s Alexa now has 10,000 “skills” or third-party voice applications created by developers, double the number just three months ago. Who knows what potential revenue and disruption lie ahead in this future?
Amazon Connect enables AWS cloud services clients to easily set up a contact center and offer their customers support, information and other typical call center services. Amazon Chime adds additional cloud-based video and voice conferencing services although it’s unclear whether this low-cost market could lead to new bigger revenue potential.
How Amazon is disrupting grocery
Of all Amazon’s retail ambitions — an online juggernaut that began with books and has expanded to everything under the sun — its grocery effort remains somewhat undercooked, despite a decade in the space.
There’s no real mystery to why Amazon would be so assertive in grocery: Total 2015 U.S. supermarket sales were $649 billion, according to the Food Marketing Institute. And trends favor Amazon’s incursion into the space, with grocery trips increasingly fragmented as households more often split shopping duties (rather than leaving the chore to women), as e-commerce sales contribute a growing (if still uneven) share and as younger shoppers go to different retailers for various reasons, according to other research from FMI.
But it’s not just the size of the market, analysts say. As a high-frequency purchase, grocery makes a lot of sense for Amazon.“They want that consistent customer back in the fold. Most consumers look at grocery shopping as utilitarian. It’s not passion purchases, it’s ‘my standards, my staples,’ so to some degree any time you remove the pain points you win. Grocery is ripe with opportunities,” Brendan Witcher, Forrester analyst, told Retail Dive. “Anyone can become a grocer, and Amazon has the benefit of having deep pockets, and most grocers don’t have that.” Via retaildive.com
Here’s what Amazon’s new stores will look like
Amazon is an undisputed leader in digital retail, but soon the online giant will venture into the realm of physical stores. This isn’t so much a choice for Amazon as it is a necessity if the company plans to remain a leader in retail. Modern retailers need an omni-channel strategy that understands and caters to every channel that customers shop in.
So what will these physical stores look like? I predict they’ll be clean-cut in the front and a bit hectic in the back — call it the Amazon mullet. By that, I mean stores will have a showroom up front with a limited selection of inventory and engaging multi-touch displays, while the distribution center will take up real estate in the back. The storefront showroom will be stocked with products chosen purposefully by data mining Amazon customer purchases for the surrounding micro-geography. The distribution center in the back will hold the less-sexy, repeat purchase products that local customers could want for instant delivery — or instant pick-up. And why not a drive-thru window for your Amazon order?
Amazon stores will be the physical equivalent of an app. We’ve already seen some of the more newsworthy elements of this approach, such as Amazon Books products having no pricing label (since prices change in real-time) or not having to wait in a checkout line to make a purchase at the concept c-store. These things harken back to the online Amazon shopping experience, where prices do change often and purchases can be made with as little as one click. It’s ‘Buy now with 1-Click’ in real life. Via venturebeat.com
Amazon Plans to Hire 30,000 Part-Time Workers Over Next Year
Amazon.com Inc. will hire more than 30,000 part-time workers over the next year to staff its growing network of warehouses around the country and handle customer service issues, the company said, evidence of continued expected demand for the e-commerce giant.
About 5,000 of the new part-time jobs will be at-home customer service representatives, the company said Thursday in a statement. The positions are in addition to the 100,000 full-time jobs with benefits Amazon said in January that it would create in the U.S. over the next 18 months.
Amazon had 341,400 full- and part-time employees at of the end of 2016, up 48 percent from the previous year, according to data compiled by Bloomberg. Via bloomberg.com
Amazon gains wallet license to boost its business in India
Amazon has gained a wallet license in India, Medianama reports, as part of a move that will allow the U.S. e-commerce giant to offer a paying experience with less friction in the country.
Amazon, which has spent $5 billion to develop its India business, used a 2014 investment in QwikCilver to enable gifting and gift cards using the startup’s wallet license. Now, some are speculating that the gifting service — which was rebranded to Amazon Pay in December — is where Amazon’s own license will be deployed.
The license was awarded in March, but news of its existence comes today just days after rival Flipkart, India’s top homegrown e-commerce firm, refueled its tanks with a record $1.4 billion funding round from China’s Tencent, Microsoft and eBay. Via techcrunch.com
Jeff Bezos says Amazon is the fastest growing marketplace in India, and it’s just the beginning
Amazon’s $5 billion bet on India is working.
As analysts at CB Insights recently pointed out, Amazon has experimented with different strategies in India to see what sticks. For one, the company rhas offered loans to sellers so that suppliers can smoothly expand their operations and manage seasonal spikes.
“Amazon.in is also the most visited website on desktop and mobile,” Bezos says. The company has also made a number of investments. In 2015, it invested in home services company HouseJoy, and insurance marketplace BankBazaar to broaden its foothold in the country.
The company said Amazon.in is also the most visited website on desktop and mobile platforms, citing data from comScore and SimilarWeb firms. The company’s marquee India app is the most downloaded shopping app in the country, it added, quoting analytics firm App Annie. Via mashable.com
Why Amazon Is Trying to Convince CPG Giants to Go Direct-to-Consumer
Large consumer packaged goods (CPG) manufacturers have tinkered around with consumer direct sales channels for years. Procter & Gamble has sought to improve its understanding of consumer needs and drive sales through online stores, pop-ups and subscription programs such as the Tide Wash Club. Last summer, Unilever went headlong into consumer direct with its $1 billion acquisition of Dollar Shave Club.
What’s clear is that every dollar consumers spend with manufacturers is a dollar that doesn’t go to retailers. So, why is Amazon.com, a reseller of these very same CPG brands, trying to convince manufacturers they should sell directly to consumers?
According to a Bloomberg report, Amazon has invited large CPG companies to a three-day meeting in Seattle in May. The event will feature a presentation by Jeff Wilke, Amazon’s worldwide consumer chief, that will focus on the changing nature of the consumer brands market. An invitation to the event obtained by reads: “Times are changing. Amazon strongly believes that supply chains designed to serve the direct-to-consumer business have the power to bring improved customer experiences and global efficiency. To achieve this requires a major shift in thinking.” Via forbes.com
Cloud drives Q1 for Google, Amazon, Microsoft
Alphabet’s revenue grew 22% year-over-year (YoY) to reach $24.8 billion in the quarter, with $3 billion, or 18% of its Q1 revenue, coming from the segment that houses its cloud business. Amazon’s revenue reached $35.7 billion in Q1, with $3.6 billion, or 10% of revenue, coming from its AWS cloud segment. Microsoft posted revenue of $23.56 billion, with $3.6 billion, or 10%, coming from cloud.
Alphabet, Amazon, and Microsoft may have different core products, but all three tech behemoths benefited from their growing cloud businesses. Here’s a breakdown of each company’s cloud offerings:
Amazon is the current leader in cloud service offerings. Amazon accounted for 40% of the global market for public cloud services in the fourth quarter of last year. The Seattle-based company reported $890 million in operating income from its cloud business, Amazon Web Services (AWS), which accounted for the majority of its Q1 2017 profits. Amazon is looking to diversify its product offerings and rely less on e-commerce as a main driver of revenue. Via businessinsider.com
Amazon Echo can make phone calls thanks to Dialpad integration
Amazon Echo users can now make calls over the device, thanks to the Alexa voice assistant’s integration with the Dialpad cloud-based business phone platform, TechCrunch reports.
Dialpad is a cloud-based platform that enables users to make in-app calls, similar in some ways to Skype or Viber, but targeted to business clients. The feature enables users to say “Alexa, call [person] using Dialpad” or “Alexa, do I have any messages on Dialpad?”
The feature fits into Amazon’s strategy of moving the Echo products from a novelty and into a utility that can help consumers with their daily necessities. When it was first released, the Echo was only equipped with a handful of skills, like a search feature and music streaming capabilities, that really weren’t essential to consumers’ daily lives. But last year, Amazon released a software development kit (SDK) to developers, allowing them to create Alexa skills. This led developers to create skills that assist consumers with their daily tasks, such as checking the calendar or finding a restaurant nearby for dinner. This is helping to fuel the device’s increasing popularity — BI Intelligence forecasts that the Echo products will be in 16.5 million American homes in 2022. Via businessinsider.com
Amazon Alexa 10,000 skills now available
If voice assistants really are the next big user interface, then Amazon is off to fantastic start — by the numbers, at least. As this chart from Statista shows, Amazon’s Alexa assistant now has more than 10,000 “skills” (i.e., third-party voice-enabled applications). That’s double the amount that was available just last quarter.
To be clear: That developers are interested in Alexa is good news for Amazon, and Alexa itself seems to be well ahead in the home compared to rivals like Google Assistant, the AI found in the Google Home speaker that competes directly with the Alexa-centric Amazon Echo.
But, as always, quantity isn’t quality. Calling up an Uber or ordering a pizza just by yelling across the room is convenient enough, but for every useful skill, there are 500 CorkOrnaments.com deal alerts or “Flat Earth Facts.” This is the trade-off of every open platform, but it points to a simple, non-flat-Earth fact: It’s still early days for voice assistants. Taking that into account, it’s no surprise that most Amazon Echo owners only use Alexa in the simplest ways possible. Via businessinsider.com
Amazon’s AWS Connect Contact Center – A Possible Industry Disruptor
On March 29 at Enterprise Connect, Amazon Web Services (AWS) announced Amazon Connect. According to Amazon, Amazon Connect is a simple to use, cloud-based contact center service for customers to deliver better customer service at a lower cost point. It is based on the same contact center technology used by Amazon customer service. According to Amazon, setting up a cloud-based contact center with Amazon Connect is a few clicks in the AWS Management Console, and agents can begin taking calls within minutes.
This new offering from Amazon could be a disruptor to the industry for the following reasons:
– Like other AWS services, Amazon Connect is a pay-as-you-go service on the AWS platform
– Amazon Connect also charges on a per minute basis (vs. a per seat basis), meaning the lower the total minutes count in a given period, the lower the cost from Amazon. This one point alone is a driver for delivering customers the experience using self-service tools such as IVR and web forms vs. voice calls. According to Amazon, there are no up-front payments or long-term commitments and no infrastructure to manage; and as part of the “AWS Free Usage Tier,” you can get started with Amazon Connect for free. Via ucstrategies.com
Q&A: A look at how Amazon Chime will stack up in the UC market
Earlier this year, Amazon announced a new cloud-based video and voice conferencing tool called Chime. Amazon credits Chime with being easier to use than other similar platforms. But in an already saturated UC market, how will Chime stack up against established players? Rob Bellmar, EVP of Business Operations at West’s Unified Communications discusses the basics of this launch and what it means for the industry.
1. What are Chime’s prospects in the UC market?
What’s missing in today’s UC marketplace are clear differences across service providers. Industry players often duplicate and build on pre-existing ideas instead of championing original innovation in areas like commercial, product or delivery. From disruptive startups to established brands, the industry is packed with plenty of contenders seeking customers. Therefore, the greatest attribute Chime brings to the market is its association with Amazon, a company notorious for its disruptive market capabilities that are worth watching. Via itproportal.com
Weekly news you can use
Was this in-depth look at Amazon business strategies useful? You can get similar weekly newsbriefs in your inbox at no charge by subscribing to Cashback Industry News at the top of this page. We promise to deliver news you can use once a week.