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Analysis: Amazon’s grocery stores shows importance of a physical touchpoint


So if Project Como reports are to be believed then rumour has it that Amazon is to open convenience stores, as well as operating drive-in locations for customers, as the online delivery giant goes even more physical than before.
What retailer hasn’t been affected by the power of Amazon? Very few. From large corporate giants to small-scale private retail businesses all have seen the power the company holds on the market – and how easily it can sway customers away from them with their super slick ordering and delivery promises.

But at least these retailers generally had a physical advantage over Amazon. They had their own stores.

Now it seems that Amazon will have even more of theirs, since opening their first ever bricks and mortar store last year in Seattle.

The retailer has been selling groceries since 2013 via AmazonFresh and it’s reported that the new stores will sell fresh produce, milk, meats and other perishables. Instore ordering points – such as touch screens as well as a mobile app – will also allow customers to order other longer shelf items for same-day delivery.

It’s a move that has sent nerves rattling sky high at retailers worldwide and is also a stark reminder that with the best online retail experience and delivery model in the world a physical presence is still a huge advantage for retailers.

“Amazon’s move to introduce further traditional bricks and mortar stores is a reminder that the high-street remains a vital component to the overall shopping experience – and that strong retail experiences must remain omnichannel,” says Hugh Fletcher, digital business consultant for Salmon.

“It’s interesting to note that Amazon’s smaller grocery stores will feature technology platforms that will allow users to deliver items from in-store to the home, while also choosing a specific time slot that suits their needs,” said Fletcher.

David Jinks, head of consumer research at ParcelHero, believes it’s a concept that will expect rapidly. “Amazon has been quick to launch Fresh services in the UK and expand its range and options rapidly. There’s little doubt that it will also launch a physical presence in the UK if the experiment is well received in the US,” he said.

“In city centre locations fast service convenience stores make huge sense. The weekly food shop will soon be history in the US and the UK as Amazon Fresh, Ocado, etc take over this role. Super-fast service at small high street stores, linked to Amazon Fresh checkouts on shoppers’ mobiles, make such stores ultra-convenient,” he said.

It’s certainly going to mean that retailers can’t sleep easy since Amazon has proved its power yet again.

Image credits:

Amazon press office

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