While Amazon's online business is booming (in revenues – but decidedly not profits), its somewhat sunning inactions at CES this past week raised more than a few eyebrows. Quietly and with no grandiose Michael-Bay-style presentation, Wired reports the 'we-can-make-a-profit-any-time-we-like-if-we-really-wanted' company placed an Amazon Vending Machine at the Las Vegas Airport. As Wired continues, any foray by Amazon into the world of offline retail is a big deal… when Amazon ventures into the physical world – whether with in-store delivery lockers or grocery trucks or vending machines – the company’s sheer scale and ambition demand that you think in terms of world domination. Hhmmm…
…this isn’t just a nice piece of marketing. Those attendees were right to turn their heads. Though there’s nothing new about electronics vending machines, any foray by Amazon into the world of offline retail is a big deal. When Amazon ventures into the physical world — whether with in-store delivery lockers or grocery trucks or vending machines — the company’s sheer scale and ambition demand that you think in terms of world domination.
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Picture a near-future where high-tech Amazon vending machines are on every corner selling the kinds of things that typically take shoppers to Walgreen’s or CVS. The machines would take up way less real estate than stores, which would keep overhead low. They could go just about anywhere — say, the basements of big-city apartment towers or the courtyards of suburban residential complexes. And they could be refilled by drivers traveling their daily Amazon Fresh delivery routes (or, you know, by drones).
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As Amazon has made abundantly clear, it’s never been content to limit itself to any one identity. Its primary business, online retail, is a booming success with customers. But offline retailers from Barnes & Noble to Bed Bath & Beyond to Sears are floundering, and Amazon may see an opportunity. It reinvented shopping with its online store. Why not do the same offline? Perhaps that humble vending machine is where that starts.
We are a little more skeptical that this is indeed the strategy that will mean world domination but for sure, it means fewer per-sales employees as yet more aspects of the global supply chain from production to sale becoming automated… Of course, one can only hope it helps operating margins…
or free cash-flow…
Though, we suspect it will be merely another way for Bezos to push off any inevitable 'a-ha' moment on the stock for another product cycle.
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via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/RmDelscsJow/story01.htm Tyler Durden