John Boccuzzi, Jr.

Rumor Mill: The Amazon Store is Coming

February 9, 2012

FROM RETAILWIRE:
A report last weekend by Good EReader said that Amazon, similar to its Quidsi division, was tinkering with the idea of opening a small store in Seattle to show off items such as its various Kindle models and a widely anticipated Android smartphone line. Do you think it makes sense for Amazon to open physical stores?      [more...]

Amazon has been extremely successful building its brand without a store. What I find interesting and what current Brick & Mortar stores should be paying attention to is Amazon sees the B&M model as a possible threat/opportunity. B&M can be a huge differentiator if done right. Apple dominated the field with a whopping $5,626 per square foot of retail space. Amazon understands that excellent, in-person customer service, holding the item to purchase, and a unique shopping environment can greatly influence a consumer, and they want in.

My hope is that Best Buy and other retailers that have been competing feverishly with Amazon learn from this, and realize how important B&M stores can be for a retailer. What should these retailers do? Continue to hire and train the best employees. Optimize inventory and assortment and finally, modify the size of stores.

Take a note from Apple's play book. A small store, limited SKUs with outstanding employees and a unique shopping environment equals over $5,600 per square foot of retail space. Not bad.