Fast Five Shorts | Amazon Shuts Down Secret Fertility Tracker Project
In the latest edition of Omni Talk’s Retail Fast Five, sponsored by the A&M Consumer and Retail Group, Avalara, Mirakl, Ownit AI, and Ocampo Capital Chris Walton and Anne Mezzenga discuss: Amazon Shutting Down A Secret Fertility Tracker Project
For the full episode head here: https://youtu.be/UxDXVG9DOuQ
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Transcript
This is a headline I could not make up if I tried.
Speaker A:And Amazon has shut down a recent secret project to develop a fertility tracker.
Speaker A:According to cnbc, the company had been working to launch a fertility monitoring device and companion smartphone app for the past four years as a project as part of a project codenamed Encore.
Speaker A:I guess said people who asked not to be named because they weren't authorized to speak to the press.
Speaker A:No surprise there.
Speaker B:Or they didn't like the name of their product.
Speaker B:Project like, right, I don't want to write to Project Encore.
Speaker A:Project Encore, yes.
Speaker A:Well, that even the naming gets even better.
Speaker A:And because the team sat within Amazon's Grand Challenge, which connotes all kinds of bad things for me, are also known as its special projects division, the sources said.
Speaker A:The project appears to have been a costly endeavor as well, and required significant upfront investments for lab research and development, in addition to the high salaries for scientists and engineers, the sources said, adding that the team's weekly overhead was roughly $1.5 million, which by my counts and is some significant Cheddar.
Speaker A:Are you pro or con the idea of an E commerce retailer tracking your fertility?
Speaker B:I don't think that's the question to ask.
Speaker B:I really don't.
Speaker A:Oh, really?
Speaker B:Okay.
Speaker B:I think that everybody is.
Speaker A:So you could be okay with it.
Speaker B:Yeah, I mean, there's.
Speaker B:I give my information to a tracker and it doesn't matter to me if it's Clue or it's Amazon.
Speaker B:I don't think that's the story here.
Speaker B:I think there, the press and media is using this as an opportunity to kind of freak people out.
Speaker B:Given the current climate of like Amazon's tracking your fertility.
Speaker B:Well, there's some benefits to that too.
Speaker B:And I don't think it's wrong for Amazon to be doing this.
Speaker B:I mean, if I can get vitamins or I can get other things, you know, because there's, it's more than fertility that you track in these apps.
Speaker B:It's, how are you doing on sleep, your mood, energy, all these other things.
Speaker B:And so I think that if you start to look at those things and would it be convenient for me to get vitamins delivered to me in a couple of hours through my Amazon prime membership or other things like there, there could be benefits.
Speaker B:So I don't, I don't think people should be hating on Amazon for trying something like this.
Speaker B:What I do think we should be paying attention is to.
Speaker B:Is the fact that Jassy is really looking closely at where they can curb spending, that Amazon is in a challenging position like A lot of other retailers are right now and they need to start to look at where they can cut costs.
Speaker B:And unfortunately, as we know, Chris, like, innovation is some of the first places where they can cut some of that spending, especially at the burn rate that you're talking about, you know, one million something a week.
Speaker B:I mean, it makes sense that this might get, get tabled for a little while so they can focus on the core business.
Speaker B:So I think that's what's the real headline here.
Speaker B:Not whether or not Amazon should be doing a fertility tracking program.
Speaker B:But what, what, what are your thoughts?
Speaker B:I mean, what would you do if.
Speaker A:You were so I want to make sure I understood you correctly.
Speaker A:So you're saying that you're a, you're fine with Amazon doing this if they didn't have the budget constraints that they're currently facing given their current financial performance?
Speaker A:You are.
Speaker A:Wow.
Speaker B:Okay, this is not the area where, this is not Amazon's core business right now.
Speaker B:This is the potential down the road to find other areas for generating revenue.
Speaker B:So I don't like the idea.
Speaker B:Interesting.
Speaker A:And that's why I don't like it because I think it's just outside of the core in general.
Speaker A:And it shows two things to me.
Speaker A:One, it shows to me the, the sheer temerity or hubris that Amazon thinks its success in selling goods via E commerce and cloud data storage allows it to do right, that it can get into fertility tracking.
Speaker A:Because the actual tie ins with Amazon's vaunted flywheel are stretches at best.
Speaker A:Like, oh yeah, I can get my vitamin.
Speaker A:I can know when to send people their vitamins.
Speaker A:Like, I don't, I don't know like that, that's okay, fine, you could always make those connections.
Speaker A:But like, come on, there's more here on this than meets the eye.
Speaker A:And so I think he's right to pull the plug on this.
Speaker A:I think they've gotten their skis too far ahead of them, gotten too far ahead on their skis for many projects like this.
Speaker A:And so I think it brings them back to the core of like, what really gets Amazon's flywheel working and where do they really have a right to win now with that said, Anne, I'm going to talk out of both sides of my mouth because I will still take discounted Ed drugs and hair loss drugs till the cows come home.
Speaker A:Like they announced last week too.
Speaker A:So, so, you know, I don't know, but this just feels different to me.
Speaker A:That feels like core retail and commerce.
Speaker A:This feels like a bridge too far for me.
Speaker A:But I don't know.
Speaker A:You get the last word on this one.
Speaker B:See, I still disagree.
Speaker B:I mean, it sounds like they still have one project in this grand challenge portfolio that's still in the healthcare space.
Speaker B:And I do think, like, again, I think people are focusing too much on the fertility tracker part of this.
Speaker B:There are so many more elements.
Speaker B:There's a flywheel of once someone does get pregnant and they are already in the Amazon universe, you are able to bring them in to start offering them baby gear.
Speaker B:You're starting to, like, get them earlier in on the cycle.
Speaker B:I don't think this is any different than, like, some of the stuff they're doing, like right now, the Amazon hall, like the TEMU competitor thing, like, they're trying to find new areas for growth.
Speaker B:And I don't think that that's a terrible idea to get people attracted to.
Speaker B:You used to checking an app multiple times a day and then being able to transact right within it.
Speaker B:So I.
Speaker B:I don't hate it and I think that people are focused a little bit too much on one particular function of it.
Speaker B:So that's where I'll.
Speaker B:That's where I'll leave it.
Speaker B:But fair point.
Speaker A:And we agree to disagree.
Speaker A:Anne.
Speaker B:That's right.
Speaker B:This is a very civilized show that we have friendly today and we're very friendly until we get further into the show.
Speaker B:Don't worry, people, we'll be back.
Speaker B:Yes.
