Risky business: Is Amazon tempting fate with physical store?

10/10/14 by Rennie Detore



Amazon, the online marketplace that has made life miserable for tangible, physical stores like Best Buy, Bed Bath and Beyond or Macys, has finally decided to take its business and retail acumen from the world wide web to an actual, in person storefront.
So Amazon has already essentially beaten the competition, so now they're deciding to join them?
That decision fans the flame of both questionable decision making, as in why mess with a good thing, and a logical next step for an entity that has already conquered the online world of retail.

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The real question Amazon must ask itself has little to do with inventory, pricing or how the competition is going to react now that they're getting into the store business.
Are customers going to react accordingly?
Granted, this is only talk of one store, rumored to be in New York City, which as sources reported would be a warehouse that would allow customers to buy online and perhaps pick up the same day. The idea of picking up a product in the store or having same day delivery is another reason Amazon is opening this test market of a store to see if the consumer responds or if what they do best is better left behind the security that it a computer monitor or tablet.
Amazon opening the lone store in New York City really is more about testing the water than making a one fell swoop splash into the retail world that includes physical stores. Amazon is a brand that delivers better pricing and expediting shipping to customers, thus being a worldwide leader in keeping those same customers happy, content and better suited to have a few extra dollars in their wallet.
If Amazon can bring that same mentality and business savvy to an actual store without the threat or fear of a letdown now that the great and powerful Oz that is Amazon has emerged from behind its proverbial curtain, then more power to them.
For Amazon, the physical store isn't about changing what they do well but rather branching out its marquee to go above and beyond its current list of accomplishments. If the store works, more undoubtedly will pop up. If not, the idea will quickly be dismissed, and truthfully Amazon or its rain makers won't miss a beat.
The online retailer can easily survive a flop that is a brick and mortar store, because their online prowess is both well documented and somewhat bullet proof. So if they get a blood on their hands with an idea (the physical store) that doesn't work so well, Amazon will simply wash off the misstep and continue doing business as usual.
And for that reason, testing the marketplace with this idea isn't a deal breaker but rather could blossom into a handshake agreement between customers and Amazon that suggests customers will agree to follow Amazon wherever the next idea may take it.

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