Fast Five Shorts | Pros And Cons Of Amazon Featuring Products From Other Websites Within Its App
In the latest edition of Omni Talk’s Retail Fast Five, sponsored by the A&M Consumer and Retail Group, Mirakl, Simbe, and Ocampo Capital Chris Walton and Anne Mezzenga, along with special guest hosts from the A&M Consumer & Retail group David Brown and Lisa Collier discuss: The Pros And Cons Of Amazon Featuring Products From Other Websites Within Its App
For the full episode head here: https://www.youtube.com/watch?v=W5GLcP12oeI
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Transcript
Amazon's mobile shopping app is now featuring products from other sites.
Speaker A:Amazon is testing a new feature that enables users of the Amazon Shopping app to find select products from other sites and go there to purchase them.
Speaker A:Currently in beta, the Shop Brand sites directly feature is live for some US Customers and will be rolled out to more based on feedback, the company said on a Tuesday, February 11th press release.
Speaker A:Customers who have access to this beta search will find in their search results select products that Amazon doesn't sell in its store alongside the products that Amazon does sell.
Speaker A:And they will see a link to the brand's website, according to the release.
Speaker A:When customers click on that link, they will receive a notification that they are leaving Amazon and will go directly to the brand's website where they can evaluate the product and make purchases directly from that brand.
Speaker A:Now, here's the kicker.
Speaker A:If that brand happens to have Buy with Prime enabled products, prime members will then be provided with free delivery, easy returns and customer support for the items that they purchase directly on that brand's website.
Speaker A:Lisa, we're going to you here with this one.
Speaker A:Again, what are the pros and cons here of Amazon testing if consumers will want to buy products from other websites via the Amazon mobile app?
Speaker B:Yeah, look, we all know there's always an angle with Amazon, right?
Speaker B:How they're going to drive more, right?
Speaker B:So I think at the end you kind of hit on it.
Speaker B:Look, if it's Prime, Amazon's winning anyhow, right?
Speaker B:Because they're doing the back end of that execution.
Speaker B:They're collecting data, right.
Speaker B:They're gaining a financial benefit.
Speaker B:They're also gaining insights of what don't I have on my site.
Speaker B:You know, maybe their algorithms aren't perfect, but now this will be a new algorithm they can add because they'll have some access, some way to understand how the consumer, you know, is going from site to site.
Speaker B:Look, I, I don't know that I can necessarily see a con on it at the end of the day because ultimately there's so many different learning and revenue streams and opportunities that I think Amazon does get from this.
Speaker B:Plus, in a lot of ways it'll benefit their partners.
Speaker B:So it actually, in a different way is, is a new positive shift on their partnerships because they're saying, hey, if you don't allow us to carry this from you on our site, we're going to still support you.
Speaker B:Now, likely they're driving that kind of prime deal with them simultaneously.
Speaker B:But honestly, I think generally speaking for amaz, a win win for brands that don't have you know, great accessibility.
Speaker B:I think it's a win for those brands.
Speaker B:So I'm not really sure I see a big con here as it relates to Amazon and the consumer experience here because basically the consumer wants fast.
Speaker B:Amazon has trained them that way and they're going to get it any way they want it now.
Speaker A:Yeah, I mean, I think you did.
Speaker A:I agree with everything that you said, Lisa.
Speaker A:I think it's also the only thing that I would add in is that it's still a search game and Amazon wants to be the first place that you go when you're looking for products they want.
Speaker A:They're in competition now with, you know, ChatGPT or with ChatGPT, with Google, with all these other search engines to get that traffic to be the place where you can find the product the fastest that you're looking for.
Speaker A:And so I think that's the biggest component here is, you know, it comes down to where can I go that I can confidently find those products?
Speaker A:And then, of course, Amazon's getting all of this information and setting up their sales team is to be like, you need to go talk to this person, because people are, people are looking for this on Amazon and they're, they don't have buy with prime set up.
Speaker A:David, where do you land on this?
Speaker C:You know, I think when you got to pay for a $600 million wedding or replace the teak on your boat because you use the legal ones, you need another revenue stream, right?
Speaker C:And this is a perfect revenue stream for, for Amazon.
Speaker A:This is, this is buying.
Speaker C:Pointed it out earlier, Right.
Speaker C:You know, Amazon's a nerdy tech company and effectively a supply chain company.
Speaker C:So it's a perfect play.
Speaker C:I mean, this is an AWS and supply chain play, right.
Speaker C:It's the natural extension of what they're already doing.
Speaker C:The all the brands already have branded stores on Amazon.
Speaker C:So what's the difference now if it actually just goes back to their site and, you know, and Amazon does the fulfillment on it, which is, you know, most of the products will probably be prime enabled anyways.
Speaker C:So it's, it's a perfect evolution of what they're already doing to, you know, make them a bunch more money.
Speaker A:Right.
Speaker A:Chris, how do you, how do you think about this?
Speaker D:I don't have much to add.
Speaker D:I think the point I bring in here is I think this is a little bit more.
Speaker D:This, a little bit more of a defensive move than an offensive move.
Speaker D:Have we been.
Speaker D:As we've been discussing.
Speaker D:And I think it goes back to what you said, and I think it's because of the rise of gen AI search.
Speaker D:I think, you know, Amazon has no choice to go but to go in this direction.
Speaker D:That's my opinion because, you know, otherwise they're going to give up the game to Google and any startup gen AI search engine over time.
Speaker D:And.
Speaker D:But the thing that Amazon has in its back pocket that makes me think this could work to the point that you guys are saying is, and Ann, you said it too.
Speaker D:Amazon knows how to get shoppers and convert them to buyers faster and better than anyone.
Speaker D:So, you know, as they're developing what the next generation of search commerce looks like, I think Amazon has a good footing in there.
Speaker D:And the buy with Prime Hook, as I think about that evolution is also really interesting to me as well.
Speaker D:So yeah, that's, that's my take.
Speaker D:I think universally we all are kind of agreeing this one and I think.
Speaker C:That the buy with Prime Hook is, is really interesting because the things that most of the, you know, kind of the national brand struggle with more than anything else is the supply chain and the shipping side and dealing with returns.
Speaker C:It's, it's really what is killing them.
Speaker C:And now they've effectively just outsourced it to Amazon.
Speaker C:So I do think for a lot of the bigger brands, it's a win, win.
