Amazon may dominate e-commerce. They may also be getting into bricks-and-mortar retail in a big way from books to food and fashion. But Amazon is also the target by large competitors like Walmart and every big to small retailer who can hustle to provide competitive prices and deliver exceptional service.
Amazon has made some fascinating strategic moves recently. It partnered with Kohl’s to sell products and accept product returns. Not sure about the real benefit mid-to long-term for Kohl’s but you could argue it will bring more shopper traffic to the retail store giant.
After buying Whole Foods for $13.7 billion, Amazon cut prices by 43% for some items and shoppers are buying food in growing numbers from the new grocery partnership. Bloomberg reports Amazon may soon be ready to roll out its own package delivery service to compete directly with current suppliers FedEx and UPS.
Amazon’s own private label brands sold more than $250 million last year and make up 85% of private label sales on Amazon. Its Lark & Ro fashions and Amazon Elements baby care and vitamins brands each grew 90% last year. Other retailers selling on Amazon can often find themselves overwhelmed if Amazon identifies and moves into their market niche with a competing private label product.
When it comes to bricks-and-mortar technology, Amazon’s staff-free, instant checkout experiments boldly show the future for other retailers. But can smaller retailers compete with these new technologies and costs?
Amazon is growing its B2B business by expanding into Japan and India where it already has substantial consumer operations and success. Amazon says it now has more than one million B2B customers in the US.
Analysts at Leerink say Amazon is certain to get into the wholesale prescription drug business within two years and who knows what other sectors are at risk by the global giant?
Store Wars continue with new episodes appearing in the business news weekly.
Read more about Walmart’s Store Wars strategy here: “Store Wars: Walmart readies its omni-channel retail arsenal.”
More valuable news insight follows…
Now You Can Make Returns From Amazon Purchases at Kohl’s
First Kohl’s agreed to let Amazon set up shop in its stores to sell products customers can eventually use to bypass shopping at Kohl’s altogether, now it’s agreed to accept product returns at its stores for items purchased on the e-commerce site. For the hope that the contract between the two will generate a little more customer traffic and a bit more sales, Kohl’s has entered into a Faustian bargain with Amazon that can only result in it losing both its soul and sales in the long run. A free pass There’s no real good that can come of this deal. Via host.madison.com
Amazon’s Whole Foods is stealing customers from everybody
Consumers flocked to Whole Foods in droves after the organic grocery chain slashed prices by as much as 43 percent after its $13.7 billion sale to Amazon (AMZN), according to an analysis of mobile phone location data by research firm Thasos Group. According to Thasos, nearly 25% of the new Whole Foods customers came from Walmart, the largest US seller of groceries. Another 16% came from Kroger, the No. 1 operator of conventional supermarkets and 15% came from warehouse retailer Costco. Via CBS News
FedEx and UPS May See Start of Amazon Rivalry
Seattle-based Amazon’s long-rumored delivery service — and feared disruptor of FedEx Corp. and the United Parcel Service (UPS) — may actually be coming soon, according to Bloomberg. Reports emerged this week that Amazon is testing the service as part of its push to expand free two-day delivery offerings and solve its warehouse overcrowding problem. Via PYMNTS.com
Amazon private brands grew 90% over last year
Amazon private brands Lark & Ro sales doubled, from $5 million to $10 million this year, dominating Amazon’s $21 million in overall apparel sales this year, with the Amazon Essentials clothing sales reaching $3 million in that time. Other Amazon apparel brands include Buttoned Down, Mae and Goodthreads, the company said. Amazon Elements, which ranks third behind Huggies and Pampers in baby wipes, accounts for roughly $10 million in sales so far this year. Via retaildive.com
Amazon Business opens for business in India and Japan
Amazon Business opened its e-commerce doors in India last week, following its debut earlier last month in Japan. Buyers on the Amazon Business India site can pay via credit or debit cards, cash on delivery or Amazon.in gift cards. Amazon also operates a separate B2B wholesale site in India, at Amazonbusiness.in, for retailers to buy consumer goods for resale. Via digitalcommerce360.com
Are prescription drugs the next target for Amazon?
Another day, another report that Amazon might try to upend a part of the traditional retail industry. Are pharmacies and the health care business next? Two analysts at Leerink, a boutique investment firm that focuses on the health care industry, said in a report Friday that Amazon will “almost certainly” get into the prescription drug distribution business within the next two years. Q13 FOX News
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