Macy’s announced a few weeks ago that it is closing 100 of it’s stores – that’s almost 15% of it’s total store count!

Like the video states, other giant retailers like Kohls are also losing sales, and a lot of it is due to the 800 pound gorilla in the room: Amazon.

So should you be scared of Amazon? And is it all about bargain hunting these days?
This is actually a big enough topic that we’ll address this in a few blog posts in the next few weeks. For this first one, let’s probe that first question: Should you be scared of Amazon?

First, it’s useless to try to argue that Amazon is not affecting almost every retail market. They have come streaming into multiple market sectors with all the subtlety of a charging rhino. Their introduction of Prime was a massive hit and they’re still gathering momentum in almost everything they put their hand to. It’s a stark fact that they are eating up other retailers by simply doing some things better and offering products cheaper than certain competitors.

OK, so we’ve established that Amazon isn’t going away, and that it’s growth is making the retail market much more challenging and competitive.

So what it a retailer supposed to do? Is it hopeless to think that an independent retailer can survive in this environment?

I don’t think so. It’s going to be harder, but not impossible. Here are three reason I think so:

1. The face of Amazon is not a physical business or group of people, it’s a website.
2. Amazon is built on a specific business model – ECommerce.
3. Amazon is satisfying customers who are looking for a bargain.

The Face of Amazon

Amazon does some things really, really well. It can give you some great deals and good prices on shipping. It has one of the best websites in the world. But it is limited… have you ever really gotten to know a living breathing person at Amazon? I have shopped with them for a few years and have actually never talked to a live person. Even if I did, it’s not like I’d be able to go back and talk with “John Doe” at Amazon for all my retail needs.

The website is their salesperson.

The fact that their website is their salesperson is both their biggest strength and their biggest weakness. The website works great for some things, but think about it… YOU are doing all the researching. YOU are comparing and deciding and weighing out all the factors involved. YOU have access to a lot of information and data about products, but that doesn’t always mean that you have a transparent or helpful view into what you are trying to buy.

Two Key Traits: Personality and Trust

In the shoe store I worked at, people came in specifically because they knew that we could help them with their unique needs. They could buy the shoes online, but the website wasn’t going to size their feet, know instinctively what brands worked best for their wide or narrow foot, what insoles to recommend, call their podiatrist and get their opinion, etc…

Or here’s another example: I just bought a used car. We’ve been shopping around for a few months now and I primarily used the internet for all my research. It was super useful to get comparisons, data on all the different cars and a feel for what was out there in the market. But guess how I actually bought the car? A friend recommended a dealership, I went and talked with a salesman who had sold 8 or 9 cars to my friend, and he found exactly what we needed.

The key element was TRUST.

I trusted my friend and he trusted this salesman. That referral was worth more to me than all the data I collected from my internet searches, even though it was helpful in some respects.

That’s our philosophy here at American Retail Supply as well. We realize that E-Commerce is growing and are making some exciting changes in that regard. But we are firmly committed to the idea that you get the absolute best service when you can call up someone you’ve worked with for years, someone that you TRUST, and get the exact thing that you need from a person.

Next week we’ll discuss the second reason it’s not impossible to beat Amazon: Amazon is built on a specific business model – ECommerce.

We want to hear from you!

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