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Retail

In the race of retail, Amazon stumbles

All of us have shopped Amazon. You’d be hard pressed to find a 6 year old who doesn’t know what Amazon is. I jumped on the Amazon bandwagon back when it was primarily still a bookseller, and have been riding the train ever since. But in the last year something has changed – the novelty, the fun, the convenience… it’s all wore off. I find that Amazon is no longer my first choice, or even my third or fourth sometimes. What happened?

The biggest thing Amazon had going for it was convenience – they became the Sears catalog of our grandparents to a whole new generation. Click and 2-3 days later your box of goodies was at your doorstep. This concept was unheard of when they started, and many retailers got left in the dust and simply couldn’t compete with this convenience and speed. In a nutshell, Amazon had the market completely to themselves.

Then something happened – the other retailers caught up, and started marching past Amazon. Wal-Mart and Target launched not only 2-3 day deliveries, but beat Amazon by offering same day delivery in many markets, or in almost every market, same day pickup. I’ve had Target deliveries to my home take less than 90 minutes. I’ve had pickup orders ready at Wal-Mart in less than 10 minutes. Amazon simply doesn’t have to the infrastructure to support something that like. Wal-Mart and Target does primarily because they have thousands and thousands of brick and mortal retail locations across the USA. The liability of brick and mortar stores all of a sudden is now an asset. To add further insult to injury, Wal-Mart and Target are offering these services for free – no yearly membership fee or anything of that nature. More money in my pocket and faster service, another win.

It’s not just Wal-Mart and Target doing this either. Macy’s, Nordstrom, Dillard’s, Journeys, Finish Line, Kroger — and hundreds more — have all developed a strong omnichannel (fancy word for retailing via many methods, including online) presence. Macy’s can have my pickup in store order ready in less than an hour, or in certain markets deliver it right to me the same day from the store. In many ways how it used to be during the early 1900’s — department stores always offered delivery services. Very few people actually took their purchases with them from the store.

Vans Checkered Pewter Skate Shoe
Vans Chex – These guys rock!

I recently wanted a pair of Vans Chex. Because I’m retro like that. I checked Amazon – $74.99. I checked Journeys – $49.99. Yikes. Journeys offered free shipping too – no magic memberships to buy – so I placed the order with them, of course. Less than 2 hours later I got an email from the shoe had shipped from a Journeys store about 150 miles away from me. Estimated arrival — day after tomorrow. Two days. For free. For less. Much less. Even if I had bought from Amazon, since I don’t pay for their “membership” called Prime, my order would have been artificially delayed for a few days (usually 2-3, but I’ve seen as many as 5 days pass). I firmly believe this is a way to hold you hostage to buy their membership.

The bottom line is, Amazon was groundbreaking when they launched, and they did help shake up the retail world. However, like almost every other retail story out there, nobody or nothing lasts forever. The major retailers have caught up to Amazon in terms of speed, cost and customer service. Wal-Mart and Target are leaving them in the dust, and their growth shows it. Even more conservative/traditional retailers like Macy’s have caught up with Amazon nowadays.

The pricing war has been won long ago (Wal-Mart started that battle), and now the speed/convenience battle is drawing to an end. If the playing field is equal now – and I can get the merchandise I want, like my Vans, cheaper, faster and “local” then why do I need Amazon?