Amazon’s Influence On The Online Retailing Space


As the world continues to become more and more technologically reliant, the popularity of online shopping continues to increase. Long before COVID-19 restrictions were enforced, physical retail locations were taking a hit. The early uncertainty of the pandemic truly shook these locations up, all while stimulating the online retailing space. Shopping online has become the safest and most convenient choice for consumers. This is largely attributed to the amount of choice that consumers have online, in addition to all of the information about products they’re interested in at their fingertips. A quick search in any browser will net you any product you’re looking for, likely coupled with reviews from other customers who have bought the product. If what you searched doesn’t check all the boxes for you, you’re in luck. Similar products are likely only a few clicks away, and you’re even able to filter these results based on price, features, or the customer reviews mentioned previously. All of these options have paved the way for online retail to dominate the industry. Even prior to the pandemic, in 2019, online retail sales amounted to more than $3.5 trillion globally, with about two billion people browsing online for different products and services. 

The values above may seem significant until you remember the influence that Amazon has over the online retailing industry. Amazon has successfully established the standard for what most consumers expect out of online retail today. Whether that be a result of the nearly 12 million products that are offered to Amazon customers, or the exceptionally fast shipping times with their Amazon prime offering, it’s hard to say. One thing is for sure though, there certainly isn’t a shortage of people visiting the platform. With nearly 200 million people visiting their website every month, Amazon’s influence is constantly felt by smaller retailers. While Amazon’s prominence isn’t directly running these businesses out of contention, it’s creating a hard expectation for these smaller retailers to meet. Some customers expect the same shipping considerations as Amazon from these smaller online retailers, which, in most cases is unreasonable. In fact, research indicates that 88% of those who have shopped with Amazon will expect similar lead times from other online retailers as well. 

For those businesses that are hoping to keep up with Amazon, even albeit at a much slower pace, these preferences can be a challenge. If these businesses are hoping to increase their online retail sales, it’s important to keep these preferences in mind. In some cases, this can mean sacrificing the time spent trying to innovate your product offerings for the sake of prioritizing speeding up shipping times for your customers. This is often a large-scale issue that requires some time to tackle. In the meantime, businesses can improve a few other things related to packages for the sake of their customers. For example, a branded tracking page somewhere on their website is a start. Even if the page redirects to the shipment carrier’s tracking page, a branded page will increase brand recognition and simplify the customer experience all the same. 

The customer’s experience on any organization’s website is of utmost importance when considering methods to improve online sales. Will customers have to create an account before they’re able to make a purchase? Are the products they’re looking for easily searched? Can their payment and shipment information be saved for future purchases? These are just a few of some of the more important factors that contribute to whether or not a customer places an order online. Optimizing the online experience for customers should be the first thing businesses do when trying to improve their sales efforts online. 

Perhaps one of the largest advantages that Amazon has over these smaller retailers is their free shipping. As mentioned previously, market research has indicated that the cost and speed of shipping are the most influential factors on whether a customer places an order online. The challenge for smaller retailers comes in the form of customers expecting their purchases to arrive at an accelerated rate, but don’t want to pay any cost for said service. Smaller retailers often have to charge a reasonable fee for their most basic shipping option, where Amazon can offer free shipping to its users no matter what. 70% of customers would rather wait longer for their orders if it means they’re not required to front a shipping bill. For smaller retailers, one way to accommodate to these preferences is to use an automated storage/retrieval system meant to help coordinate warehousing and shopping transportation more effectively. The infographic coupled with this post details these systems in addition to ways these retailers can keep their customers returning. 


Author bio: John Hinchey is VP of Sales for Westfalia Technologies, Inc., a leading provider of logistics solutions for plants, warehouses and distribution centers. He has more than 20 years of experience in manufacturing and warehouse automation.

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