Online retailing isn't always about the product. It's about the shopping experience. And Amazon.com - which opened for business on the Web in 1995 and now has a spot among the Fortune 500 - isn't really about fulfilling orders. It's about technology, says founder and CEO Jeff Bezos.
Sharing his vision of online retail at Retail Systems Expo this past June in Chicago, Bezos noted that technology is the key to driving everything from customer service to the delivery experience, and stressed that giving options to consumers is an important part of making them happy. For example, he said, give customers the choice of having product delivered or picking it up in the store. Another tip? "Let customers do as much as they can for themselves," he noted, pointing to tasks ranging from canceling and changing orders to completing and reading reviews of merchandise online.
Bezos knocked down a few myths of e-commerce as follows:
Myth: Internet Rush = Gold Rush
Reality: The gold eventually ran out. With innovation, there is no "last nugget."
Myth 1999: E-commerce will kill retail.
Myth 2000: E-commerce is dead.
Reality: The Internet is an important sales channel.
Myth: Core skills and competencies are the same for online and brick and mortar retailers.
Reality: "Location, Location, Location" is crucial for brick and mortar retailers. This is not a factor online.
Reality: It is impossible to personalize the physical store experience for every customer. This can be done for online shoppers.
Reality: Robots don't go to the mall. But computers can be programmed to repeatedly visit a site to check for merchandise. (Bezos noted that a new release of PlayStation, which included 4,000 units, sold out in 37 seconds, because of robot purchasing.)
Myth: Fulfillment is Amazon's biggest investment.
Reality: Amazon is a technology company, focused on arranging bits of information in a specific order, improving product discovery and the customer experience. The company has spent $300 million on fulfillment systems; $700 million on brand and customer acquisition; and $900 million on technology.
Editor's Note: Amazon.com has created a new subsidiary, Amazon Services, which will make its technology and services available to other companies. For more information, e-mail Bezos at email@example.com.
JORDAN K. SPEER is senior editor of Apparel. She may be reached at firstname.lastname@example.org.