Are retailers selling their souls and giving away customers to Amazon?
Presented here for discussion is a synopsis of a current article published with permission from the blog of Ken Lonyai, Digital Innovation Strategist, co-founder, ScreenPlay InterActive.
In Jim Croce’s classic “You Don’t Mess Around With Jim” he warns “You don’t tug on superman’s cape, You don’t spit into the wind, You don’t pull the mask off that old Lone Ranger, And you don’t mess around with Jim.” If he were with us to update the ditty for some of today’s retailers, the last caution might change to “And you don’t invite Alexa in.”
You see, Walmart, Bed Bath & Beyond, Staples, Best Buy, Fry’s and Target are among the retailers selling the Amazon Echo family of devices powered by Alexa on their store shelves.
Some might think it’s “OK” to regain a few bucks lost to Amazon or “if you can’t beat ‘em, join ‘em,” but these merchants are truly courting danger. Despite any claims to the contrary, with the abundance of innocuous Alexa Skills, the developer program, and third party device/product manufacturers incorporating the interface, Amazon’s fundamental mission for the AI system is to drive purchases of Amazon goods. In a subliminal way (maybe not so subliminal!), she also increases brand recognition, familiarity and comfort with the e-commerce giant.
So when retailers invite Alexa onto their shelves and websites, they summon the very soul of the company that’s leading the disruption of their market and stymying their sales.
It feels as if someone at an Amazon product meeting flippantly made a comment like “Hey let’s get our competitors to sell Alexa!” and after a good laugh, the staff looked at one another and pondered “Why not try?” And here we are today, witnessing the equivalent of Apple stores selling Windows PC’s, Starbucks selling Dunkin’ Donuts, or Chevy dealers hawking Mustangs. Maybe it’s a retailer’s version of Stockholm syndrome?
Bottom line: brand erosion from this kind of “strategy” is unseen at first, but like a tiny fissure in a dam, it grows and when it becomes alarming, is irreversible and accelerates until everyone can hear the thunderous crescendo of failure.
Let’s put a pin in this one and see where things end up in a few years.
DISCUSSION QUESTIONS: Do you see more drawbacks than benefits from retailers selling Amazon Echo devices? What potential risks and benefits do you see?