By Tom Erskine, CEO of One Door
June has been a busy month for Jeff Bezos.
In its ongoing quest to offer one-stop shopping, Amazon announced its acquisition of Whole Foods for $13.7 billion.
Brick-and-mortar is not entirely new to Amazon, as the retail giant began experimenting with physical locations last year. Amazon opened bookstores and introduced the cashier-free Amazon Go concept.
I had the chance to speak with FierceRetail about why Amazon’s focus on brick-and-mortar is something that retailers should pay attention to. Amazon is showing that stores matter. Period.
Without a physical location, retailers will struggle to meet consumers where they are and deliver experiences that drive sales.
We can officially stop talking about how e-commerce is taking over the retail landscape following this acquisition. As I said to Janelle Nanos at The Boston Globe, there are things that the physical experience delivers that never go away.
With an eye also on the apparel industry, Amazon announced the beta launch of Prime Wardrobe. Amazon’s recent acquisition of men’s fashion brand, Bonobos, is a new addition to the company’s Prime membership. It aims to target online apparel players like Stitch Fix, Warby Parker, and, of course, Walmart.
In Retail Touchpoints, I hint at the fact this acquisition may lead to a massive change in the retail supply chain. Long term, it’s easy to imagine a limited number of omnichannel retail supply chains in the U.S.
Walmart, Amazon, and brands that rent space on those supply chains while maintaining a customer-facing presence, as opposed to building and maintaining their own.
We’ve seen this happen in other industries, like wireless networks, where a few major players dominate the market.
However, brands like Cricket Wireless, Virgin, Boost Mobile, and Metro by T-Mobile still attract a different customer. If this kind of consolidation happens in retail, back-office supply chain investments should take a backseat to focus on investments in technology that help differentiate the customer experience.
Undoubtedly, Amazon is already planning its next move and keeping a spotlight on the retail industry. I’m anxious to see what Bezos comes up with next.
Learn more about omnichannel retail strategies in our guide, Scaling Your E-Commerce Brand into Physical Stores: The Role of Visual Merchandising Software.