Why Amazon Is Moving To Brick And Mortar Stores
It’s hard for many to understand why Amazon, the world’s largest e-commerce and cloud computing platform — according to sources such as Axiomg — is choosing to open physical stores for its customer base. One book in particular, Amazon: How The World’s Most Relentless Retailer Will Continue To Revolutionize Commerce, lists five reasons for this change, according to the co-author Natalie Berg, via Forbes. This biggest of which boils down to one word: disruption.
Jeff Bezos founded Amazon.com in 1994 and began the business as purely an online bookstore, which was later expanded to sell videos and other products such as MP3, audiobooks, software, and video games. Eventually Amazon began to sell electronics, apparel, furniture, food, toys, and jewelry. For the most part, any item that consumers are looking to purchase — without ever having to leave their home — is available on the website. By 2015, Amazon surpassed Walmart as the single most valuable retailer in the United States, based off of market capitalization. The company comes in just behind Apple and Microsoft as the third most valuable public company. Amazon is also the second largest employer in the United States, following Walmart.
After surpassing the retail giant in market capital in 2015, Amazon sought to continue their revenue gain by launching their very first brick and mortar bookstore in Seattle, Washington. Since then, Amazon Books has quickly expanded with more launches across America. By 2017, the company stepped out and acquired Whole Foods in a $13.4 billion deal that allowed Amazon to own 460 stores across United States, Canada, and Britain. But with so much success and demand for online shopping, one might wonder exactly why Amazon is choosing to continue expanding with more traditional, physical retail storefronts.
Berg cites the readiness for disruption as one reason. Amazon is doing what the company always does: disrupt. Shoppers are currently dissatisfied, it seems, with the state of current in-store experiences, and in response, Amazon is stepping up to yet again become the game changer.
“No-one loves a challenge more than Amazon. It sets them apart from their rivals. Consumer expectations are super-charged and Amazon sees the opportunity to bring the physical store into the 21st century.”
Amazon is not known for replication at all, and consumers should not expect the company to copy other retailers’ in-store experiences, according to Berg. Rather, the platform will highlight all the friction points in the customer shopping journey, and eliminate those pitfalls as much as possible with its new physical retail locations, creating what may be an all-new shopping experience.
