Amazon: The Success of “Virtual” Store

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I am going to use the world “stunning” because I could not describe how impressed I was with this CNN Money article: “Amazon hiring 30,000 part-time workers, including 5,000 work-from home positions” with the intention of hiring 100,000 full-time employees in the next 18 months! Wow, that is a stunning success!

Steve Jobs once mentioned that retail stores always will part of his business. He was against others that suggested Apple should be away from retail stores. So far Steve Jobs is right, Apple stores today, represent one of the most visited retail stores in the North America.

However, brick and mortar (B&M) stores are being re-shape in our days. Apple has a unique feature that other stores can not bring to the consumers. Customers want to talk to an Apple employees and see products being demonstrated in front of their eyes. That is unique for them, plus Apple also offers the online shopping experience.

E-Commerce is redefining how we shop today. The business landscape is now being divided between B&M vs E-Commerce. The former is definitely gaining momentum.

According to the same CNN Money article:

  • “The company also said it plans to hire 100,000 full-time workers in the next 18 months in the United States. Amazon’s announcement comes as many popular retailers are closing stores and eliminating jobs. In the last month alone, Payless Shoesource, Dollar General, JCPenneyand GameStop each announced a significant number of store closings.”

The huge success of Amazon is a sign that consumers are relying more and more in the internet as first option for product acquisition. Basically you can buy almost everything through E-Commerce, without visiting a B&M store.

Also, most of the B&M are not open 24 hours a day 7 days a week. Online shopping literally is open any time you want to place an order. But B&M stores are not a concept in “extinction”. Apple is a clear example of that. Amazon now has its own B&M store; Amazon Books!

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The reality was different for stores like Radio Shack, Payless, GameStop, etc… the cost of maintaining a B&M store at the same time that consumers could buy the same product online was not feasible for them. Perhaps the solution for them, was 5 years ago, started reducing the number of stores and/or size, at the same time investing on E-Commerce. But now is too late for some of them.

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2 thoughts on “Amazon: The Success of “Virtual” Store

  1. This is so cool to read! I’ve definitely noticed a lot more stores either switching to “online stores”, using the pop-up (short term) store option, or like you said with simply going out of business.

    Do you think there’s going to be a major shift in companies building physical vs virtual stores in the future? Or do you think this is just the market adjusting itself?

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  2. I think the market is adjusting itself and we will see more options of on-line sale. Almost all major retail stores will have that option. Walmart for instance offers delivery free for must of the items purchased online. I tested them, buying a $9 BluRay movie, thinking that would prompt a delivery fee, and was surprised that was free of delivery charges. Best Buy have the option of buying online and picking up the product at store if you don’t want to pay for delivery fees (due the value of the product not applying for free delivery).
    Amazon did very well in this business. But now that most of the stores are selling online, we will see what will happen with Amazon in the next 5 years.

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