Multichannel retailers can up the ante in the fight against Amazon by providing additional services that build on their existing strengths.
As Amazon revs up its grocery offering in the UK with a partnership with Morrisons and the predicted launch of Amazon Fresh here later in the year, more retailers will now find themselves competing with the online giant.
There is no denying that Amazon is a formidable force because the company has a strong delivery proposition and consumer trust.
“Delivery expectations are soaring among consumers who are looking for similar offerings when shopping elsewhere”
Jason Tavaria, Shutl
The knock-on effect is that delivery expectations are soaring among consumers who are looking for similar offerings when shopping elsewhere.
Yet premium delivery comes at a cost.
Amazon has done a good job in encouraging customers to contribute to these costs – either by stealth, through Amazon Prime, or by paying for a same-day service.
Not many retailers can offer services such as film and music subscriptions which encourage customers sign up for a premium delivery service like Amazon Prime, thereby providing high customer satisfaction through faster delivery in the process.
It may be tempting to try and offer a like-for-like alternative but that will only work if a retailer has a comparable infrastructure behind it and very few do.
Extending the offer
Retailers need to look at what they do best. Consider the realistic alternative add-ons that encourage customers to pay for premium delivery services and ensure high satisfaction levels.
An example might be access to a VIP service team or enhanced warranties. It is imperative that retailers offer free, no-hassle returns – without that you cannot gain customers trust.
It’s also worth maximising the one thing that Amazon doesn’t have – a nationwide physical presence of store locations.
Look at how these can be utilised to best advantage, for instance, improving click-and-collect facilities or servicing all local customers with same-day deliveries.
The popularity of click-and-collect specifically has, in part, been driven by Amazon’s ability to provide fast and convenient delivery.
Customers are taking greater control over how and when they receive orders, and click-and-collect facilitates that.
Pooling resources
Making the process as painless as possible – from in-store navigation to collection options – will help encourage uptake and improve customer satisfaction levels, particularly by removing the disappointment of receiving the dreaded ‘while you were out’ missed delivery card.
Pulling resources together with other retailers will strengthen further an organisation’s ability to have a multichannel offering capable of competing with Amazon.
“Pulling resources together with other retailers will strengthen further an organisation’s ability to have a multichannel offering capable of competing with Amazon”
Jason Tavaria, Shutl
Being physically closer to customers will also make it easier to fulfill orders and returns.
Partnerships will help to expand a store base quickly – either through full acquisitions, or reciprocal arrangements with other non-competing retailers for services such as click-and-collect or returns processing.
The Amazon effect is not only here to stay but will get stronger as it expands its empire.
Instead of taking on the retail giant at its own game, retailers should play to their own strengths and shift the retail goal posts more in their favour, provide consumers with even more choice and control in the process.
- Jason Tavaria is head of direct at Shutl
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