Should retailers emulate or differentiate from Amazon?
Through a special arrangement, what follows is a summary of an article from Retail Paradox, RSR Research’s weekly analysis on emerging issues facing retailers, presented here for discussion.
In discussions with 10 different retailers, RSR found strong agreement that Amazon.com is the enemy. But a debate then ensued on whether retailers should try to be more like Amazon or try to be nothing like them at all.
From the “To Be” camp, a recently retired CIO at a $2 billion specialty retailer stated: “You need to determine which things are part of the waterline now. I was shopping the other day online and told that I needed to spend more money to get free shipping. Really? I expect free shipping from everyone all the time now.
“Every day you have to look at Amazon and admire what they keep realizing — that there are all these ways to exploit enabling technologies to make the customer experience better.
“I hear people always saying, ‘Don’t try to compete with Amazon.’ But remember this: if they are doing something they are doing it because it works on your customers.”
These are valid points.
But from the “Not To Be” camp, a tech leader at a $800 million specialty retailer stated about his company’s approach:
“I want to know exactly what Amazon is doing, but not to do it — to stay out of their way. If I try doing what they are doing, there’s no way I’m going to win.”
This makes perfect sense, as well. A mid-size specialty retailer is never going to have the might to compete in the same fight.
Having heard their detailed viewpoints on the future, I think they are both right. They have the correct answer for their brand, specifically.
The choice of “to be like Amazon” or “to be anything but Amazon” is an entirely personal decision for each brand involved. More importantly, no matter who you are, your size or what you sell, this is a decision that needs be made right now. It will likely not only determine whether your brand will still be viable 10 years from now — it’s the question that shapes strategy. And people who successfully compete against Amazon a few years from now will not have done so by happenstance.
DISCUSSION QUESTIONS: Should retailers attempt to be more like Amazon or completely different? What advice would you give to a retailer looking to compete against Amazon?