Amazon Weekly News: July 18th, 2017

Notably absent from my coverage this week is commentary about Prime Day. That's because I’ll be publishing a deep dive about how our clients performed on Prime Day in a blog post later this week, covering topics like wins, losses, the impact of PPC, and lessons learned for next year's Prime Day. Be sure to subscribe to our newsletter so you don't miss it.

 

Use of voice commerce is on the rise.

New research says that nearly one in five consumers (19%) have made a voice purchase through an Amazon Echo or other voice-controlled device in the past year. Another 33% plan to do so in the next year.

What does this mean for brands selling on Amazon? Firstly, brands must have their products available on platforms that facilitate voice commerce (Amazon right now, and presumably retailers who merchandise via Google Shopping in the future).

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Voice commerce will make it possible for consumers to shop anywhere. Instead of needing a digital device to place an order, let's say, you could stock up on groceries while cooking in your kitchen. Commuters can shop hand-free on the way home from work. Shopping will be even more convenient than it is now, which may translate into a sustained growth rate for e-commerce.

Finally, it will introduce a new type of product listing optimization requirement--brands will not just have to optimize their product titles and descriptions for desktop and mobile shopping experiences; they’ll also have to optimize for voice. 

 

Guess who's coming with dinner?

Amazon has filed for a U.S. trademark to create and deliver recipe boxes. In part due to leading meal-kit provider Blue Apron recently going public, these meal kit companies are having a big moment right now and Amazon wants to get in on the action.

Still, its seems excessive to file for a trademark on an existing service numerous companies have been providing for years. Does Amazon have a grander scheme in mind? Probably. Meal kits are still a premium option, and perhaps Amazon sees a way to use its immense logistics capabilities to open up meal kits to a wider range of consumers.

Any way it can, Amazon wants to leverage its logistics infrastructure to build economies of scale to drive down the cost of its entire network.

 

E-commerce: a net contributor of jobs?

An economist named Michael Mandel has recently claimed that e-commerce will increase retail jobs, despite popular opinion to the contrary.

His claim is based on several facts he's researched: the fact that jobs in fulfillment and distribution centers may not be counted toward the overall e-commerce job number, that such jobs pay an average of 30% more than brick-and-mortar jobs, and that these jobs stimulate growth in economically-challenged areas.

The obvious criticism of this argument, however, is that fulfillment jobs will increasingly be taken over by robots, so any gain will be short-lived.

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My take is that recent history provides proof of the ongoing, simultaneous consolidation and fragmentation of the retail industry. The emergence of supermarkets consolidated consumer spending from individual stores or shopkeepers (e.g., the butcher, grocer, and baker) to a single store. That shifted jobs from mom-and-pop small businesses to multinational retailers. And now we see a resurgence in boutique/handcrafted food products.

E-commerce is now shifting consumer behavior, and the nature of jobs is shifting with it. Our needs have changed, and people don’t want to go back to writing lists, driving to the store, finding a parking place, walking inside, filling up their car with goods or groceries, and then driving home again.

Now, these companies must employ or subcontract for jobs consumers no longer want to do. Yes, a lot of those jobs will soon be automated. But who are the employees behind these new robotics manufacturers or consulting firms who help retailers implement this new technology? Despite the large number of jobs revolving around picking and packing inside warehouses that will be lost to automation in the near term, there will be entirely new categories of jobs created in the years to come.