4 Ways Amazon Is Remaking the World in Its Image

Amazon’s impact on commerce is impossible to ignore. The pioneering e-tailer has nearly perfected the arts of e-commerce and logistics to bring customers the shop-from-anywhere experience we couldn’t have imagined 20 years ago. But a flurry of announcements and acquisitions have signaled the next stage in its plan for world domination.

Amazon logoAmazon’s impact on commerce is impossible to ignore. The pioneering e-tailer has nearly perfected the arts of e-commerce and logistics to bring customers the shop-from-anywhere experience we couldn’t have imagined 20 years ago. Order it today, and it’s in your house in less than two days from just about and vendor in the world.

But a flurry of announcements and acquisitions in the last week signaled the next stage in its plan for world domination.

Amazon has mastered a massive niche in warehouse-to-customer fulfillment via online order. Amazon is able to control most of the variables in that world, which allow it to optimize for price, delivery and overall customer experience. If you can control those three things, you can win a lot of business.

Amazon also doesn’t make much money. Oh, it makes more than enough to make Jeff Bezos absolutely filthy rich, but Amazon prioritizes growth over profits to an unheard of extent. That leads to price cutting and a lot of pressure on any other business in its markets. In truth, many retailers rely on Amazon for sales, but suffer from its competition.

Now Amazon is reaching far beyond its niche in ways that could rewrite other areas of commerce. And those innovations could remake the entire shopping word in its image.

whole foods logo1. Buying Whole Foods

The most notable move was snapping up Whole Foods, a favorite grocery chain among affluent customers, with stores in some of the most desirable retail real estate in America. Speculation on how Amazon will use that purchase has run rampant since it was made, but the advantages are numerous.

The obvious next step would be for Amazon to use Whole Foods as a jumping off point for home food delivery, a space it’s been trying to crack for years but never had the grocery distribution network to cover. That will allow it to apply the kind of logistical expertise it has in non-perishable goods to the grocery market, and compete with the PeaPods and Fresh Directs of the world.

It could also launch a subscription box service like Blue Apron; which is a big enough threat that it’s actually impacting Blue Apron’s IPO.

2. Amazon Prime Wardrobe

Of course, being an online retailer has limits. It’s hard for customers to try on clothes from the other side of the Internet. But subscription clothing services like Trunk Club allow users to try on clothes at home and only pay for what they keep.

Yesterday, Amazon announced its own version of that service, called Amazon Prime Wardrobe. Customers in the program can order clothes that come in a resealable box with UPS return labels.

https://www.youtube.com/watch?v=EIQh0O3wOdM&feature=youtu.be

Try on the clothes, pay for what you like (currently there would be a discount for keeping multiple pieces) and return the rest.

Add the Echo Look — which combines the echo personal assistant device with a camera for personal stylist-like functionality — and you have a transformative clothes buying experience.

3. A ‘Prime’ Low-Income Segment

I mentioned earlier that Amazon is in the business of growth more than profits, and perhaps no move shows that more than it’s price cut to Prime for low-income customers.

Changing Grocers: What Does AdTech Have to Do With It?

New York’s continuous march toward gentrification has many victims … including my go-to Murray Hill neighborhood grocers. But was I part of the problem?

Photo: BlueApron.com
Photo: BlueApron.com

New York’s continuous march toward gentrification has many victims … including my go-to Murray Hill neighborhood grocers. But was I part of the problem?

The “we’re closed” sign and “thank you” note on the two nearby Gristedes could have been authored by the “The Rent Is Too Damn High” party. The fancy Food Emporium closed — and a fancier Trader Joe’s took its place. D’Agostino’s also took a hiatus in the hood, with more likely to go. Fairway opened its doors … a cavern underground in Kips Bay, filled with folks buying organic-this and gourmet-that. Whole Foods is a short hailed ride away.

So I swap one grocery name for another … no big deal, right? My lament is otherwise — my weekly grocery bill is skyrocketing. And my dash for milk and a couple of pantry staples means a patient wait in long lines that at least move methodically.

Which is one reason why I’ve turned to online recipe and ingredients delivery (Blue Apron customer for two years and counting) — easy meal planning, door delivery, less food waste and $9.99 a portion — far cheaper than any surviving grocery or any local takeout. At least two other tenants in my building of 30 units appear to be doing the same.

But that leaves me wondering: Did all the bargain food shoppers abandon moderate-price grocers in favor of premium shops? Or did high apartment rents — and even higher home buying prices — drive out all the bargain food shoppers? Probably the latter. And where did those folks go?

My neighborhood has a lot of diversity, but economic diversity, not so much. Manhattan is becoming Paris … who can afford to live here? Expensive cities are a nice problem to have (a sign of popularity, but limited housing stock), but it’s not a long-term strategy for urban health. People need to be able to live near where they work — it’s a practical consideration for quality of life.

San Francisco, San Jose, Seattle and Austin probably have the same problem. Booming tech creates outlandish salaries to keep up with more outlandish costs of living, poaching (which drives up salaries and benefits even more), and a need to move jobs elsewhere. That could be across the bay in Oakland, across the river in New Jersey, down the road in San Antonio or Tacoma — or hundreds of miles away in still-steep but less-punishing places like Los Angeles (Downtown and Silicon Beach), Greater Boston or the DC Beltway. Perhaps Philly, Baltimore, Chicago and Detroit are the next frontiers — never mind China, India or Eastern Europe.

But all I want to do is grab a half gallon of milk. Make that almond milk, unsweetened, vanilla flavored.