The elephant in the board room - Amazon

Amazon is THE elephant in every board room in the US. From Healthcare to retail to FMCG to CPG to fashion Amazon seems to be creating chaos in most industries by technological advances, product development and end-to-end distribution. 


Dealing with this evolution and transformation of industry, companies need to begin to shift their business models to either directly compete with Amazon or learn to embrace them as a crucial driver for their business. No industry is more hard hit by Amazon than the retail industry. Below are some core challenges that Retail Leaders need to solve in order to be successful in an Amazon-forward marketplace. 

In 2018, executives of public companies worldwide mentioned “Amazon” in more than 2,300 calls and conference presentations.
— Quartz

Fighting Default

As interfaces become obsolete for many searches and online activity and voice starts to permeate a lot of consumers lives, we need to find a way around “The Default.” As Scott Belsky puts it, “A new battle is brewing to be the default of every choice we make. As modern interfaces like voice remove options, augmented reality overlays our physical world, and artificial intelligence gains our trust by transcending our own reasoning, DEFAULTS WILL RULE THE WORLD.”  This means that when a user asks Alexa to “buy detergent,” it will default to a brand and if one isn’t selected in preferences, more than likely the result will be the default private label brand from Amazon. 

Brand Protection

In 2017 Nike entered into a partnership with Amazon to help achieve their $50B vision. There were many reasons to do so, but none more important than protecting their brand. Nike found there were several accounts of unauthenticated resellers selling Nike products and even counterfeit products. In order to maintain the brand that Nike has spent decades and billions of dollars to create, they knew they needed to find an end to this deception, while expanding their retail distribution.

Differentiate from Generic

According to the New York Times points out, “about 70 percent of the word searches done on Amazon’s search browser are for generic goods. That means consumers are typing in ‘men’s underwear’ or ‘running shoes’ rather than asking, specifically, for Hanes or Nike.” This means that brands and products need to fully understand the marketplace to be able to intercept generic searches to become the selected result for the consumer. There is a combination of activities to do this, but one strategy is that of continued brand differentiation. How can your brand become part of the 30% branded search or own the results from a generic? 

Retail Distribution

Here’s a crazy figure, Amazon was attributed to almost 50% of all US e-commerce sales in 2018. A staggering trend that likely won’t go away soon. As younger generations use Amazon as their go to purchase platform and Amazon continues to innovate, companies need to develop strategies that embraces Amazon as a core part of their retail distribution. Or have a strong differentiator outside of the Amazon ecosystem.  

How are you dealing with Amazon? 

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