Amazon’s new direction

Amazon could probably afford to sit on its laurels. It owns half the market in US e-commerce. It has high market shares around the world, notably in the UK, Europe, and India. It’s the gorilla in its marketplace.

But Amazon keeps innovating; it’s always trying new things.

For instance, by the end of the year the first two satellites of Amazon’s Kuiper broadband network should be up and running. That pits Amazon against Elon Musk’s SpaceX and will let Amazon provide broadband internet.

The first Amazon Style outlet opened in Los Angeles in May. It’s an attempt to provide a blend between the convenience of browsing online, and being able to try clothes on and see how you look. Clothes can be ordered via the smartphone app and sent to the fitting room, and the Amazon algorithms will offer extra recommendations.

The biggest plus for many will be the ability to order up a different size or color without leaving the fitting room. Will it lack the ‘fun’ vibes of shopping in a boutique or a department store? Maybe. But for those who’ve grown up using the internet to shop, it might be just the style they want.

The algorithms are an intriguing AI take on the personal shopper. A lot of people love using a personal shopper, but some customers feel pressured into purchasing too much, or simply feel vulnerable. A recommendation on your smartphone carries much less risk, and you don’t feel you have to be polite about turning it down.

As an added bonus, you can have the items sent to your home address, instead of struggling to the car park or into a taxi with bulky packages.

Amazon has also launched a virtual try-on service for sunglasses. You just take a selfie using the downloadable app, and the software does the rest. 1,500 different models can be tried on. That’s good for the customer, and also good for Amazon which will get more clicks, more conversions, and a lot fewer returns.

Amazon Pharmacy isn’t new – it’s been working since 2020 – but it seems to be gaining traction right now. Besides saving the majority of customers $20 an order or more, according to Business Wire, Amazon Pharmacy offers some real ease of use. It connects with customers’ health insurance, and automatically compares savings with their co-pay.

Customers with multiple long term medications can purchase their entire drug menu sorted into packets by date and time. That’s good news for busy people with a lot of medications, for caregivers, and also for anyone who gets muddled about what they need to take, and when.

And Amazon has just purchased One Medical, a tech-centric primary healthcare business, for nearly $4bn. So this is clearly a direction that Amazon has targeted for the long term.

As an FBA seller, is this going to impact your life in the short term? The answer is almost certainly no. But it does underline that you need to keep up to date on what Amazon’s doing.

Imagine, for instance, that Amazon’s algorithms pointed Pharmacy users towards health supplements and vitamins as an ‘also bought’ product. How would you boost your product’s chances of being selected?

It also suggests that different product areas of Amazon may start to get a different look and feel. So far, Amazon has hung together as one giant superstore. If it starts opening virtual pharmacies, virtual clothes stores, and perhaps virtual home decor stores, those areas of Amazon might end up looking a bit more like the stores and a bit less like Amazon…

So make sure you keep up to date on what Amazon is doing. It’s always interesting, whether or not it’s an opportunity for your FBA business right now.


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