Amazon once again found a way to make waves throughout the retail
industry, as rumors ran rampant last week that the e-Commerce giant would open
between 300 and 400 Amazon Books physical stores. While the initial leak
from Sandeep Mathrani, CEO of shopping mall operator General Growth Properties,
turned out to be nothing more than initial chatter, the thought that Amazon
could build out more of its own physical stores is a very realistic
possibility.
This week, the RTP
team discusses whether the planned rollout of Amazon physical stores will be a
hit for the brand, and identifies the retailer’s motives for the decision.
Debbie Hauss,
Editor-in-Chief: I don’t see how this format can work as a traditional
bookstore per se, but I agree with Computerworld’s Mike Elgan who is pontificating about
why this could work for Amazon. He noted that the stores could be used as
pickup location for other Amazon products, which, I agree, is brilliant. The
brick-and-mortar locations also can showcase other products, such as the Echo.
And they can help give a “face” to the brand. Right now Amazon is
just an online behemoth that lacks brand personality. If done right, with the
right management and employees at the store level, this could be a resounding
success.
Adam Blair, Executive
Editor: Only when the
subject is Amazon could an offhand remark – from someone not even employed by
the company – create tidal waves of fearful chatter throughout the retail
industry. Now that some of the dust has settled, it seems clear that while
Amazon will almost certainly open more physical retail locations, the company
will almost certainly NOT open 400 (or even 300) bookstores. Borders is dead
and Barnes & Noble, the last man standing of the national chains, only has
640 locations. Would Amazon spend money boosting the nation’s bookstore
count after it has spent decades decimating the
brick-and-mortar side of the business? What seems more likely is that
Amazon will open some stores, in order to strengthen its fulfillment
capabilities and returns processes, as well as to give customers a real-world
taste of its branded products like the Kindle and the Echo digital personal
assistant. But Amazon will also keep the rumor mill active about its plans,
quite possibly to keep the rest of the industry guessing and off-balance.
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David DeZuzio,
Managing Editor: It seems you can’t swing a dead industry without running
into Amazon these days. The rollout of Amazon’s bookstores, whether they’re
opening 100 or 400 stores (Amazon can afford it and they don’t seem to care all
that much about actually making money) it is a great idea. It
will be a hit because as we’ve learned, digital is great, but people still love
to touch and feel and books are made for exactly that. Add in the price
matching of Amazon’s web site and you’ve got a winner. Also, it’s a going to be
a great place for in-person fulfillment and returns — one thing Amazon
needs — which leads me to think the bookstore may evolve into a
physical extension of all that is Amazon.
Since Amazon is the reason the bookstore market has almost
disappeared, to see them jumping into physical stores should be reassuring to
book lovers across the world. The days of the bookstore aren’t necessarily
numbered; just reorganized.
Glenn Taylor,
Associate Editor: It’s unsurprising that the initial “leak” of 300 to 400
stores turned out to be all style with little substance, but the idea of Amazon expanding
its brick-and-mortar presence certainly is grounded in realism. The retailer
could use these bookstore stores as “destination
locations” — distribution centers — designed to bring consumers in to pick
up purchases made online. Between the general high costs of shipping and consumers’
desire for quicker delivery times, Amazon would be able to answer both of these
issues in making their internal fulfillment process cheaper. Additionally,
Amazon’s grasp on e-Commerce browsing and delivery data may enable them to have
a better idea of exactly where to place a store so they can build them appropriately instead of wasting real estate.
Klaudia Tirico,
Associate Editor: I love a good bookstore, but I’m going to have to be a
pessimist about this. I just don’t see the point of Amazon opening up however
many bookstores they are planning to. Sure, the idea of strengthened return
processes and easy testing of tech products, as my colleagues have pointed out,
is great. But I think Amazon is getting along just fine without them. Frankly,
I think it’s rude of them to open up bookstores after putting chains such as
Borders to shame. Amazon should just stick to improving their e-Commerce if
they don’t know what else to do with their money.
Sincerely,
A big fan of small business bookstores
