Amazon in mad Dash to add buttons in U.S. homes

Discussion
Apr 01, 2016

For those who may have questioned whether Amazon.com was joking around when it introduced its Dash button exactly one year ago today, it’s become abundantly clear that was not the case. The e-tailing giant has announced the expansion of the Dash program to more than 100 additional buttons enabling customers to order thousands of popular brand items across a wide variety of CPG categories.

“Prime members are using Dash Buttons at an increasing rate — over the last three months, Dash Button orders have grown by more than 75 percent,” said Daniel Rausch, director of Amazon Dash, in a statement. “Customers are using Dash Buttons more than once a minute, helping ensure they never run out of their everyday essentials.”

In a RetailWire webinar earlier this week, “The Rise of Convenience Commerce,” Ken Cassar, VP, Analytic Solutions at Slice intelligence, told attendees that Amazon sold nearly 400,000 Dash buttons in 2015. Dash reorders occur roughly once every two months and the average order size is large. Two Procter & Gamble products, Tide and Bounty, have average Dash reorder sizes of $20.11 and $27.11 respectively.

Slice Intelligence has also found that the use of Dash buttons pretty much squeezes competitive brands out of Prime members’ purchases. Bounty, for example, accounts for 99 percent of a customer’s category spending after a Dash button purchase. P&G rival Kimberly-Clark’s Cottonelle brand has 82 percent of category spending with Dash users.

New brands available using Amazon Dash include Brawny, Charmin, Clorox, Doritos, Energizer, Gain, Honest Kids, L’Oreal Paris Revitalift, Lysol, Peet’s Coffee, Playtex, Purina, Red Bull, Seventh Generation, Slim Jim, Snuggle, Starbucks, Trojan and Vitamin Water.

Dash Buttons are available to Prime members for $4.99 each, with the amount of the purchase credited to their Amazon account. To reorder products, Prime members press the Dash button. Orders come with free two-day delivery.

DISCUSSION QUESTIONS:
What are your expectations for consumer adoption of the Amazon Dash button along with other IoT devices for retail purchases over the next few years? Is “squeezing out” competitors with a Dash button ultimately a good or bad thing for retailers?

Braintrust
"While consumers claim to desire variety, they also conversely demand convenience, which typically don’t come hand in hand."
"Amazon needs to create a Dash button that is limitless (i.e. can order any product from the website) and can be programmed for each household."

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14 Comments on "Amazon in mad Dash to add buttons in U.S. homes"

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Keith Anderson
Guest
1 year 8 months ago

The Dash button is a stepping stone on the pathway to more robust IoT commerce plays like Alexa and the Dash Replenishment Service, but it’s doing better than many expected. And it’s only the beginning.

The physical and digital shelves aren’t going extinct, but at one of the frontiers of growth for consumer products there is no shelf.

I published some brief thoughts on that scenario here.

Max Goldberg
Guest
1 year 8 months ago

Dash allows consumers to reorder with a push of the button. Echo takes voice orders. Little by little, Amazon is dominating the market for items ordered from the IoT. The company has the brands, the delivery systems, competitive pricing and great customer service. Why should consumers use their valuable time to shop elsewhere? It’s not a matter of squeezing out other brands — it’s all about consumer trust and convenience.

Tom Redd
Guest
1 year 8 months ago

I highly doubt that the Dash button will totally squeeze out competition. The Dash concept is cute — not secure — and another way for a hacker to back door into a users account. Amazon will soon have to have a Dash Hack weekend and give a prize to the teen that backdoors into a Prime user’s account via the Dash button address.

Some shops run for IoT. Others have stuck with proven and secure IoT technology platforms. Dash along, Millennials. We will watch Amazon control more and more of your life.

Shep Hyken
Guest
1 year 8 months ago

Who would have thought this could happen? Another way to buy. It’s a perfect solution for an online company, be it Amazon.com or any other company, to create potential loyalty. Keep the price competitive and make it as easy as possible for the customer to buy, and the retailer may, at least for staples such as consumable supplies (soaps, detergents, etc.), create some customer loyalty.

Good or bad, it’s here. Don’t just deal with it. Embrace it. Is there a “Dash” type button in your business model? Should there be?

Dave Wendland
Guest
1 year 8 months ago

This may represent a new normal and traditional retail may need to align. The Dash button can be a good thing for retailers if they embrace IoT devices and do not dismiss them too quickly.

Robert Hilarides
Guest
1 year 8 months ago
I have a hard time seeing Dash buttons in my three to five year crystal ball. They are certainly an opportunistic way to capture some share and loyalty in replenishment categories and, if I marketed one of those, I would certainly participate. But they seem like a very inefficient solution from both the consumer and supply chain perspectives. How many Dash buttons do I want to keep track of? And how many single item shipments can we efficiently distribute? High value, bulky, heavy, frequently-purchased items, sure. But how long will it take to have IoT solutions (or just another Amazon… Read more »
Paula Rosenblum
Guest
1 year 8 months ago

I must be on some other planet. Here I am with a legendary bad memory, and even I can remember to order laundry detergent for the time it takes to go from the laundry room to the computer.

I confess, I don’t get the Dash buttons in the slightest. I simply don’t get it.

Naomi K. Shapiro
Guest
Naomi K. Shapiro
1 year 8 months ago

I can see it as clear as a … button. Convenient, handy, efficient, a bonanza for the provider of the product — the manufacturer … or a retailer? Definitely will squeeze out competitors who aren’t on the ball, er, the button.

Kenneth Leung
Guest
1 year 8 months ago

It is certainly a step in the direction for IoT driven retail. I am wondering if the next step is to drive the cost down enough and also get the volume high enough for CPG companies to start packaging Dash like capabilities into product packaging? Would make for intriguing scenarios for retail dis-mediation for manufacturers.

Mel Kleiman
Guest
1 year 8 months ago

I deal with a lot of companies in the home health care market. When I read this, I thought this will keep growing. Just think of our aging population and what this will do to make their life just a little easier, as the dash program or something like it continues to expand in the number of items available.

Matt Talbot
Guest
1 year 8 months ago
Consumer adoption of Amazon Dash and other IoT devices will steeply increase over the next several years. While consumers claim to desire variety, they also conversely demand convenience, which typically don’t come hand in hand. Historically the biggest market players (think Walmart, Johnson & Johnson, etc.) have dominated their industry, resulting in increased convenience and decreased variety for consumers. “Squeezing out” can be a good or a bad thing for retailers, depending on how suppliers handle the situation. Retailers can take advantage of the circumstances by buying in bulk from a few, select brands. However, if suppliers get wise there… Read more »
Kai Clarke
Guest
1 year 8 months ago

This is a limited use concept. Only products that are regularly depleted can be applied to a Dash button, and the fact that only select manufacturers are available on the Dash list only limits Dash even more. Amazon needs to create a Dash button that is limitless (i.e. can order any product from the website) and can be programmed for each household.

Vahe Katros
Guest
1 year 8 months ago
AMZN continues its effort to remove friction through the use of the patented Amazon Dash button. So what? Some thoughts: Technology helps us forget (how many phone numbers do you know?). In the future, WiFi connected everything (appliances, printers, water filters, etc) will offer us the ability to order when the thought occurs, or perhaps automatically when the toner is low, or when the light bulb burns out. If you are an Amazon prime subscriber and you don’t mind committing to a brand and you don’t want to remember anything, then sure. The question to retailers is: how much of… Read more »
William Hogben
Guest
1 year 8 months ago
I haven’t started using Dash buttons, so I can’t speak for whether it’s going to become a part of my (or others’) lifestyle, but let’s put the reported customer usage in perspective: Consumers use Dash buttons once per minute? That’s about 1500 single item orders per 24 hour day. 400,000 dash buttons were sold in 2015? That means the average button sold is pressed once every 266 days. That tells me that people who buy Dash buttons are generally ignoring them — who orders detergent, toilet paper or other household necessities that infrequently? Amazon sells over 5 billion items per year… Read more »
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Braintrust
"While consumers claim to desire variety, they also conversely demand convenience, which typically don’t come hand in hand."
"Amazon needs to create a Dash button that is limitless (i.e. can order any product from the website) and can be programmed for each household."

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