"Powering Great Commerce" News

Amazon's setting the pace of retail - are you keeping up?

Posted by Contributors on March 8, 2018

In 2017, Amazon was responsible for about 43.5 percent of all online retail sales, reported RetailDive. Figures from a study conducted by eMarketer showed the ecommerce giant was headed toward $196.75 billion in transactions for the year.

Online sales still account for a relatively small portion of overall retail transactions, standing at 8.9 percent in the second quarter of 2017, according to the U.S. Census Bureau. Nonetheless, ecommerce continues to show marked growth, with Q2 sales up 16.2 percent from the same period in 2016, though retail sales as a whole only increased 4.1 percent. Consequently, Amazon's grip on about 4 percent of the nation's retail has the attention of both its ecommerce competitors and brick-and-mortar counterparts.

The Seattle-based company has become one of the most successful in the U.S. and taken an unequaled place in the public consciousness through its innovative approach to the many complex operations that go into online sales. Retailers of all kinds are looking for the strategies and resources that will allow them to keep up and make their own name in a crowded online shopping landscape. Leaders who understand just how Amazon has established its dominant position in the marketplace can form strategic partnerships and find smart, agile ways to meet the challenges of today's ecommerce.

Making fulfillment fast, cheap and reliable

Some of Amazon's greatest accomplishments have been in the area of fulfillment. The corporation has made speedily packaging items and getting them out to customers a key part of its brand. From its roots in selling books when the company started in 1994, Amazon has branched out into selling over 598 million different products as of October 2017, according to a report from ScrapeHero.

Along the way, the ecommerce pioneer has prioritized delivering that huge variety of items ever faster while giving consumers an array of convenient shipping options to choose from. Today, the company routinely offers two-day, or in many cities even same-day, shipping on many products. Customers enrolled in Prime don't have to pay any fees beyond their annual membership to receive such lightning-fast delivery. Also, Amazon Flex (utilizing contractors to fulfill last-mile deliveries) supercharges its delivery system and the potential risk of USPS or its peers delivering packages too slowly to customers. Now, the ecommerce giant can control every part of an online order, while boosting local economies.

GIF 1 small.gif








The company achieved its revolutionary approach to fulfillment by making every aspect of the process as efficient as possible and constantly looking for ways to improve. In massive warehouse facilities, much of the work of picking and sorting items is automated. Human workers receive computerized support to optimize their performance as well. Over the years, the company has continued to iterate upon its approach, using its tremendous resources to change how people think about order fulfillment while even experimenting with concepts like drone delivery.

Providing the tools and information consumers want

Ecommerce retailers drive sales by providing online stores and mobile apps that grant immediate visibility into their inventory and powerful tools for finding just what consumers want. Building a customer experience strategy around connecting people with exactly the products they need is an increasingly important part of leading the way in online retail. A study from the IBM Institute for Business Value found that, though customers are demanding more personalized shopping experiences40 percent of the brands included in the research offered no meaningful options for customizing online interactions.

Amazon played a big part in building that demand, personalizing its connection with each individual by implementing a highly effective recommendation engine. The site makes suggestions based on factors such as what items a user bought previously, the products currently in his or her shopping cart, past ratings and likes, and comparisons with other customers' purchase decisions. The e-tailer hopes to motivate shoppers to buy products they may not even realize they want with the suggestions that appear on the storefront and in promotional emails.

More importantly, users need to be able to find the products they are actively interested in and quickly move toward submitting an order. Consumers prefer product pages that feature specific, detailed product information - preferably supported by user reviews - so they can make the choice that best fits their needs. They also want to see what they're buying: Quality photography is an important factor in giving them the confidence to move forward with a purchase.

Once users make their selections, companies benefit from making the checkout process as smooth and simple as possible. There's always a danger that a customer will decide to hold off on a purchase, especially if completing the transaction is in any way difficult or confusing. That's why Amazon incorporated a one-click ordering system that relies on a shopper's saved information to make purchases happen right away.

Maximizing ordering convenience

Long-term growth means staying on top of new technology and the changing consumer expectations that come with it. In recent years, virtual assistants have become an increasingly popular way of doing everything from asking for driving directions to controlling a home audio system. Amazon's efforts to make it as easy as possible for customers to place orders has meant taking full advantage of the rise of virtual assistants and voice-enabled speakers.

Alexa, the company's virtual assistant, gives users access to millions of products by simply stating what they want. Making purchases from the biggest online store around becomes a seamless part of the daily routine as shoppers either order products right away or ask Alexa to add them to the cart for later checkout. The assistant periodically suggests reordering the user's favorite items and makes recommendations for related products, encouraging brand loyalty and driving more sales.

gif 2 _small.gif

Amazon took full advantage of opportunities from this emerging market in home devices by releasing its own voice-activated speaker, Echo. Connecting a new device with a trusted name in ecommerce and its own virtual assistant positioned the company for success. An eMarketer study found that 35.6 million Americans used a voice-activated assistant device at least once a month in 2017, a 128.9 percent increase over the previous year, and Echo was the most popular speaker among these users with 70.6 percent of the market.

Partnering up to meet Amazon's challenge

The rise of Amazon proved the power of ecommerce and transformed the way consumers shop forever. Shopping at the biggest online retailer around drove up their expectations for convenience, service and personalization. Organizations that are determined to succeed in offering alternatives must reckon with the way the behemoth has transformed retail.

An attractive, well-illustrated online store is an essential start, but today it's not enough to just build an appealing product page. A business must act on a robust, unified customer experience strategy that's designed to provide all the information consumers want and meet their needs through multiple channels. Everything from brick-and-mortar locations, to mobile apps, to contact centers should work together to serve consumers.

Businesses rely on warehousing and fulfillment to get the right products to customers' doors quickly and reliably. For organizations with physical locations, it's just as vital to provide cross-channel options, making it convenient to pick up an item ordered online at the store.

Onestop Internet partners with organizations to connect them with the all the resources they need to compete in a post-Amazon world. Customized solutions including a full-featured ecommerce platform, professional design and photography services and global logistics allow companies to make their mark on today's ecommerce landscape. Download our new ebook to find out more about winning customers in ecommerce.

 Why Are Customers Passing You By? Download our latest infographic.

Topics: Amazon, Ecommerce, AI, supply chain, fulfillment, customer experience, onestopinternet

Subscribe to Email Updates

Popular Posts

Posts by Topic

see all