“Australia has the third highest online spend per capita globally which bodes well for Amazon’s success.”
“Australia’s brick and mortar retailers can expect increased pressure to compete and will be forced into making their business an experience rather than just a place to shop as e-commerce giant Amazon makes its way to the Country, according to a new study.”
“In the US, Amazon now accounts for almost five per cent of total retail sales and 38 per cent of online sales, while its share of UK retail spending is estimated to be around four per cent and its share of online sales at 24 per cent.”
“Citygroup estimates that Amazon’s Australian sales could reach $4 billion within five years, representing about 14 per cent of all online sales and 1.1 per cent of total retail sales in Australia.”
The above quotes are from the Inside Retail (Australia) article Investors face a ‘very real’ threat with Amazon’s arrival.
The surveys reported in the article show that the greatest impact expected will be felt on bulky goods and the high street retail sectors with 40 per cent believing Meyer and David Jones are most vulnerable.
Notably the least impact was expected in the CBD retail sector.
And herein lies the clue to being ready for Amazon potentially. Traditionally the CBD has a greater density of specialist boutique retailers than in the high street.
Retailers have to think like specialist boutique retailers. They deliver exceptional customer experiences. They have to; they don’t have the buying power to compete on price!
Don’t think customer experience is the same as customer service. Customer service is only one part of the customer experience. The whole experience is every touch point the retailer has and should have with their customer prior to, during and post the sale.
Nor can retailers make the mistake that competing on price is an effective strategy. Amazon has deeper pockets!
The reality is anyone who competes on price alone, doesn’t really have a true understanding on how to deliver an effective customer experience that emotionally engages their customers to being loyal. The customer’s only loyalty is price.
The survivors will be the retailers who are proactive in strategically planning now what they have to do to develop a great experience for their customers. And have it being implemented asap. Rumors have it, Amazon could be launching on ‘Black Friday’ this November.
To not be planning right now with less than year away until Amazon has it full service offering in place; next Christmas sales could possibly be very lean?