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EDITORIAL Competing in the age of Amazon

In today’s InternetRetailing newsletter we’re reminded not only of Amazon’s dominance of the UK online retail market, with the suggestion from Mintel that almost half of the UK population now has access to Amazon Prime, whether directly or indirectly. But we’re also reminded of the fact that it most likely won’t last forever – and how other retailers can compete. Mintel itself points out that most UK retail sales still take place on the high street, while Angel Maldonado of Empathy Broker argues that Amazon’s preeminence will be challenged when other retailers offer the kind of service that will rival the fast delivery that its Prime membership scheme. 

Hard on its heels come more details of the new Ocado Zoom service, which promises to deliver groceries to shoppers in London within an hour of their placing the order. The service presents a real challenge to Amazon’s Prime Now grocery delivery service in London – and could well be a factor in unseating Amazon from its leading position in online retail. Notably the Ocado grocery service that will deploy Ocado Zoom will soon be part-owned by Marks & Spencer, a long-established high street favourite – showing that retailers can move forward into new ways of selling, no matter what their legacy. 

Today we’re also reporting on how rising costs and falling footfall are hitting multichannel retailers hard. We have news that LK Bennett has gone into administration, a move put down to rising rents and business rates by its adminstrators and we report as Quiz says it now expects its profits to be almost half as low as previously forecast. That’s down to falling in-store sales and the need to discount in order to sell items that ultimately sold online. These stories are, sadly, merely representative of how retail is being hit by consumer uncertainty, and the rising cost of selling from the high street.

Mike Ashley and his Sports Direct International group continue to find opportunities in this uncertainty. Having made a takeover offer for Findel on Monday, by last night the group had set out plans to take over the day-to-day running of Debenhams via an ousting of all except one member of the current board. 

Today we also report as Google adds shopping to image search in what might be its own bid to compete with Amazon, while today’s guest comment comes from Roland Van Breukelen of SAP Customer Experience.

Image: Fotolia

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