Eight Ways Amazon is Expanding Offline

Amazon_4_star_storefront.0.jpg

It may surprise you to learn that Amazon has close to 600 retail locations. 470 of those locations are Whole Foods stores and the remaining 115 stores are a combination of pop-up stores, convenience stores, bookstores and general merchandise stores.  Clearly Amazon realizes that its future growth is dependent not only on eCommerce but on physical retail as well.  It has also developed an impressive system of pickup locations to meet customers where they are.  As Amazon continues to grow perhaps it will be remembered not only for how it revolutionized online shopping but retail in general.  Take a look at this list and see what type of Amazon location might show up in the future near you.

Amazon 4-Star. Amazon continues to expand its investment in bricks and mortar stores with its September 2018 opening of a new store concept called Amazon 4-star. The store only sells products that have at least a 4-star rating on amazon.com including Echo devices, games, books and kitchen and home products.   Digital price tags display the product’s customer rating as well as how much Amazon Prime members save through their membership.  Amazon now has three of these stores. 

Pop-up Stores.  Amazon has 87 pop-up stores located in Whole Foods, Kohl’s and shopping centres across the US.  These stores provide a way for customers to test and buy Amazon devices such as the Kindle and the Echo.  Kohl's signed up to have these pop-ups in its stores as a way to acquire new customers and increase traffic.  

Bookstores.  After opening its first bookstore in 2015 Amazon now has 18 bookstores. These bookstores are located in major cities across the US.  Amazon’s CFO Brian Olsavsky said that Amazon’s bookstores are a “really great way for customers to engage with our devices and see them, touch them, play with them and become fansSo we see a lot of value in that as well”.  

Amazon Go. A sneak peek into the future was given when Amazon unveiled its first Amazon Go store in December of 2016.  Amazon Go is a convenience store that has no cashiers but instead uses machine learning and sensors to determine which items customers have taken off shelves.  After customers have finished shopping they can walk out of the store without having to ever stand in a line or go through a checkout. When customers leave the store their Amazon account is automatically charged. Amazon Go opened to the public on January 22, 2018. There are now seven Amazon Go stores in the US and Bloomberg reports that there could be as many as 3,000 by 2021.  

Whole Foods.  Even with inexpensive grocery delivery people still prefer to see, touch and select their fresh food items.  That was one of many reasons for Amazon’s acquisition of 470 Whole Foods stores in August of 2017.  Amazon’s goal is to be a top five grocery retailer by 2025 and it can’t do that through online sales alone. 

Amazon Pick-up Locations.  Amazon has 31 pick-up locations across the US where customers can pick-up Amazon purchases. This service is similar to the service provided by the post office but instead it is dedicated to Amazon and customers can return packages free of charge.  Prime members can receive same day or one day pick-up at these locations.

Amazon Lockers are located in grocery, convenience stores and copy centres and allow customers to pick up and return packages.  Customers receive a unique code after they have made a purchase from Amazon that they can use to open their locker.  The placement of these lockers in Whole Foods is likely to drive cross shopping as customers shop while on a trip to the store to pick up their packages.  There are Amazon Lockers in 2,800 locations across the US. 

Amazon Hub is a package delivery unit that is placed in apartment complexes so that residents can pick up their packages from the convenience of their own lobby whenever they choose to without the assistance of a concierge.  The service is now available to over 500,000 residents in the US. 

Check in weekly for articles on digital transformation and customer experience innovation to learn what strategies businesses are using to accelerate their sales growth.

Sources

https://www.businessinsider.com/r-short-visits-rise-at-whole-foods-stores-with-amazon-lockers-2018-3

https://www.amazon.com/primeinsider/tips/amazon-locker-qa.html?tag=bisafetynet2-20

https://www.cnet.com/news/amazon-hub-lockers-now-available-to-500000-us-residents/

https://www.amazon.com/b?ie=UTF8&node=17337376011

https://www.amazon.com/b/ref=s9_acss_bw_cg_APU_1a1_w?node=17608448011&pf_rd_m=ATVPDKIKX0DER&pf_rd_s=merchandised-search-1&pf_rd_r=2JFM2JJXV2GF9T5Y4F4F&pf_rd_t=101&pf_rd_p=c764be95-3e3b-4d24-bfc3-f82483e9fe3c&pf_rd_i=14303222011

https://www.businessinsider.com/amazon-pickup-locations-how-to-use-them-2018-7

https://www.businessinsider.com/whole-foods-ceo-amazon-reputation-lower-prices-2017-9

https://ca.finance.yahoo.com/news/amazons-bookstores-arent-just-selling-012858121.html

Tricia McKinnon