Amazon: Drones, Exclusive Supermarkets, Fashion Collections…
Any strategy is good for Amazon in its attempt to retain and expand its customer base and better know their tastes.
On the one hand, Amazon continues to bet on fashion. The American giant has launched Buttoned Down, its first collection of men’s fashion. The brand will specialize in shirts made with Supima cotton, which do not need ironing.
The garments will be available only to Amazon Prime users, who pay an annual subscription to receive a number of preferential services. The collection of shirts consists of 72 models, with a price that is around 35 euros.
Buttoned Down is one of Amazon’s few proprietary brands, launched exclusively for its Prime customers. The e-commerce giant plans to expand the collection with other men’s clothing such as trousers, casual shirts and sweaters.
Amazon shot its third-quarter profit to $ 252 million, up 218.9 percent from a year ago. The group’s turnover also increased by 20.9% from July to September to $ 22,339 million. The Seattle-based company posted earnings of $ 252 million, or 52 cents a share. This result is somewhat below that expected by analysts, which amounted to 85 cents per share.
The online retailer reported revenue of $ 32.71 billion in the period, which exceeded Wall Street forecasts. For the current quarter ending December, Amazon sources said they expect revenues in the range of $ 42 billion to $ 45.5 billion. Amazon shares have risen 15 percent since the start of the year, while the Standard & Poor’s 500 index has increased slightly more than 4 percent. In the final minutes of the trading at the end of October, stocks reached $ 821.01, up 27 percent from January 2016. Year-end forecasts are for sales in 2016 of $ 127 billion, with Benefits of $ 4.6 / share with an improvement of an even weak operating result that could reach 3.5% on sales, doubling the value of 2015.
Drone Delivery Experiment.
The e-commerce giant on December 7th first time delivered a order to the buyer through a dron, according to the company’s website, through its founder Jeff Bezos.The delivery took place in the UK, and between the time of purchase and give the customer took only 13 minutes. The first receiver of the Amazon order was his client Richard B. who bought the TV decoder Amazon Fire (apart from some popcorn…).
This system is currently being tested, called Amazon Prime Air, in the vicinity of Cambridge (UK). Local authorities have allowed the online retailer to test the drones in the field. Their routes are based on GPS navigator, operators do not participate in the regulation of the moving apparatus.For delivery orders with the help of drons operating with weight limit – no more than 2.2 kg, at the time the company undertakes to deliver in no more time than half an hour.
No queues in the boxes, no logs out. So are the new Amazon Go supermarkets that eliminate the process of check-outs payment. Amazon Go, the store will feature new technology called Just Walk Out (simply, go out) to offer a purchase-registration experience unless payment is facilitated through an application on the phone. The 700 m2 store concept is currently being tested and only for Amazon employees, but the company expects to open its doors to the public in early 2017.
This is not the first attempt by the Amazon to open traditional format stores. It has already seen success with bookstores, in cities like Seattle, San Diego and Portland. There are also plans for additional stores in Chicago and Boston.
Despite being America’s largest online-based retailer, there are some categories that Amazon has not been able to get a competitive advantage, including groceries. Since online sales of this category of products still only account for less than 2 percent of the total US grocery market, a great opportunity opens up in retail food innovation. A category in which most consumers want to touch and feel the product before buying it. That gives Amazon another great reason to believe that its new store concept will work, especially in crowded urban markets.
The technology that Amazon uses in its supermarkets comprises a combination of automatic learning, computer visualization and artificial intelligence. A similar technique of autonomous cars. Amazon has been working on this technology for four years.
But ultimately, with Amazon Go, the retailer who has radically changed the way they buy hundreds of millions of people, is now aiming to also establish their dominance within the category of groceries. Amazon continues to innovate permanently and will surely continue to grow its market shares. The next challenge should be to improve the profitability of their operations. A PER of 137 times justifies this need.