How will Amazon change the game next?

I get it, a blog on Amazon is as original or surprising as grizzlies wading in whitewater during salmon season. Why the topic never ceases to be interesting, however, is because since Jeff Bezos appeared on the scene in 1994, he has changed the game over and over before anyone understood a game was on.

The reason the past few months have been especially intriguing is the purchase of Whole Foods and Ring, signals, I think, what will soon be obvious as the eRetailer's big push into analog. Put another way, after 24 years building a digital framework, Amazon has the opposite problem of most blue chips – it needs to figure out human interactions. According to eMarketer, 90% of worldwide retail spending is still in brick-and-mortar stores. Amazon's stockpile of cash allows it to invest a lot of money getting “the bricks” right while leveraging the automation and data mining of its hulking e-commerce infrastructure. That said, although it has dabbled in physical locations since 2015, the jury is still out whether it will get in-person interactions 100% correct. The quite literal foray into people's homes with Amazon Key is particularly fraught with risk, one that will subject it to new forms of regulatory and consumer protection scrutiny. But as Amazon clears those hurdles and stitches together Ring, Key, and Echo to once more redefine what shopping looks/feels like, it's clearly a threat to almost every sector, healthcare (already announced) and financial services especially. [Note: Three days after this blog went live, the WSJ published an article titled: Next up for Amazon: Checking Accounts.]

My husband recently made our three Gen Z-aged boys watch the 60 Minutes episode on Amazon with Bob Simon, which first aired in July of 1999. It is fascinating to remember what Bezos had right then, stuff many companies are still struggling with 19 years later: personalization and predictive analytics, to name just two. Both are now table stakes, something 12-year-olds everywhere expect when they go online because they have grown up with Amazon the way our parents grew up with the Sears catalog. The introduction of Echo in mid-2015 is just another example of how Amazon continues to innovate. In just 2.5 years, it dominates the home speaker market with 20mm units sold by Q3, 2017 for 70% marketshare.

Speaking of Echo, my favorite 2018 Super Bowl ad was by far the introduction of Alexa’s new voice. Sure, it was entertaining and clever but why it was brilliant is it didn’t just graze the third-rail of privacy that is on a lot of consumers’ minds when it comes to household devices, it reached out and grabbed it. To have Hannibal Lecter creepily, virtually, leer at a young woman sitting at her dressing table, Amazon openly admits it's watching us. Turning that fact into an inside joke somehow makes it less threatening. I suspect the mom at my son’s school who recently expressed concern over Echo's collection of data and the chances of it being hacked ironically got more comfortable with the product, not less. So the question isn't whether Amazon will change the game again but rather can the likes of Costco get it together before Bezos and Gen Z declare game over?

#digitalecosystem #gamechangers #genz #digitaltransformation #womenintech #amazon #dontbecostco #godigital

Note: Views are my own and not those of my employer.