[Updated post from March 30, 2021]
It’s no secret that Amazon is the retail industry’s number one influencer. It may not produce engaging digital content like your favorite social media influencers, but it does have one major advantage: Reliable two-day shipping, anyone?
Ever since it first entered the fledgling e-commerce marketplace, Amazon has totally reshaped consumer expectations for the online shopping experience.
Whenever Amazon introduces a service offering, whether it be two-day shipping or order tracking, it quickly becomes the new industry standard. This so-called ‘Amazon effect’ means that customers expect Amazon-esque service offers everywhere – and many smaller retailers are finding it harder and harder to compete.
As we talked about in the very first episode of our first season, this trend has led to the ‘Amazonization’ of e-commerce at large – and it affects more than just how quickly customers want their parcels. Brands everywhere are missing vital creative storytelling opportunities through branding and customer engagement.
Let’s dive in.
What exactly is ‘Amazonization’?
Amazon has caused massive disruption in the world of brick and mortar. Department stores, big-box retailers, and discount stores, in particular, have been experiencing declining foot traffic due to the allure of convenience and cheaper prices online.
But it’s not just physical retail that has experienced the impact of Amazon.
Because while Amazon has made the online shopping experience easier to navigate, it’s also made it a lot less…well, exciting.
How so? In Amazon, seller branding is virtually nonexistent.
Let us explain:
You go onto Amazon and place an order with a seller that sells through the marketplace. It has its own identity and brand story. But as a shopper on Amazon, this won’t be visible to you.
You browse through Amazon’s filters to reach their product offerings and use Amazon’s checkout and Amazon’s payment portal to make the purchase. The packaging you see when your order arrives on your doorstep? That’s Amazon too.
In sum, you have no meaningful touchpoints with the brand you’re purchasing from.
As you can see below, – there’s no exceptional creativity or unique branding – just the ever-present Amazon arrow:
In sum, ‘Amazonization’ is the growth of generic, wholesale retail experiences that fail to develop brand recognition on behalf of the customer.
When building brand awareness and loyalty is the name of the game, this default to Amazon-style fulfillment represents a major problem.
Many small e-commerce brands may find themselves thinking: If Amazon hasn’t had a negative sales impact from plain packaging, why should I spend more on branding?
Today’s merchants are already struggling against a tidal wave of similar offerings. If your post-purchase experience is identical to your competitors, consumers little incentive to stay loyal.
As the pressure for lightening-fast delivery has increased, fulfillment marketing has become neglected in e-commerce at large. Whether it’s outsourced order tracking, third-party returns portals, or unembellished packaging, today’s consumers may have few post-purchase opportunities to actually build a relationship with a brand.
So, what does Amazonization tell us about ecommerce?
1) Delivery is a massively under-utilized touchpoint in e-commerce.
For brands, Amazonization is the complete opposite of fulfillment marketing. If your orders are signed and sealed in ubiquitous brown cardboard, you’re not going to have much luck building brand recognition with your customers.
Why? There’s nothing to separate your parcel from the hundreds of others that online shoppers have received in the past.
It may sound far-fetched, but a fresh look on packaging could boost your sales and help increase your customer retention rate.
If you make the effort to turn your unboxing experience into a piece of theatre, you can leverage this moment of engagement to build an immersive brand experience that keeps your customer coming back from more. (Think iconic brands like Victoria’s Secret, Chanel, or Glossier).
Remember: First impressions do matter, but the final impression you leave your customer with will reinforce their initial decision to purchase – or not.
2) Shipping is the most important factor for most consumers
Did you know that almost 80% of online shoppers in the U.S. turn to Amazon because of their fast and free shipping options?
If a consumer is on a tight deadline and needs a product fast (say a dress for an upcoming event, or a pair of running shoes to kickstart summer exercise), they’re likely going to utilize Amazon, where they can be sure of the shipping and arrival date. If they have a Prime membership, they’re even more likely to go the Amazon-route.
We’re in an age of instant-gratification – and Amazon plays into this extremely well. One click and your product is already on it’s way to you!
But what is Amazon missing?
Brand identity and trust
Consumers are more likely to trust a brand if they know who they’re dealing with. Because vertically integrated direct-to-consumer brands can offer transparency over supply chains and customer care, they’re in a much better position to meet expectations – and understand what their customers want.
This is why the best D2C brands, with their ability to tap into rich data insights from across the shopping journey, are able to avoid Amazonization. They have the ability to create a customer-centric brand story from end-to-end that truly resonates with shoppers – something that large retailers often struggle to do effectively.
What can brands learn from Amazon’s success?
Online consumers want a frictionless experience
We can typecast Amazon as a boring and unimaginative retailer, but the proof is in the pudding. Whenever any of us complain about Amazon – that it’s a behemoth, it undermines competition, its vast operation is bad for the environment, etc. etc., we still know that we’re likely to be browsing through its hallowed product catalog this time tomorrow.
Why? Because Amazon has achieved the holy grail in retail and what many marketing teams strive for on the daily: it’s positioned itself as the no-brainer option across just about every product category and consumer segment.
How? Because Amazon was one of the first to understand that online shoppers are brutally utilitarian. When so many of us are time-poor and looking for an easy solution, our purchasing criteria narrow down to two things: convenience & consistency.
By delivering seamlessly on both fronts, Amazon has been able to dominate the marketplace – even in the face of retailers with better-quality offerings and customer care. Why? Because they make it easy.
The Amazon experience might be boring, but it’s predictable – and consumers like knowing exactly what they’re going to get.
So, what does all of this mean for online merchants?
Here’s the unsettling truth; you can offer the best customer experience, packaged up in unique brand identity and engaging socials, but unless you also nail convenience and consistency, you’re going to have a hard time convincing consumers that you’re the better choice than Amazon.
In 2022, being a successful merchant comes down to your ability to offer customers a frictionless e-commerce fulfillment experience that combines memorable branding with speed and efficiency.
Sippin’ & Shippin’ is here to help! We’re committed to bringing you the very best industry insiders every episode to explore how you can give your business the best chance of success. Check out our Season One podcasts, and keep an eye out for more Season Two episodes full of valuable insights.