If you haven’t been paying attention lately, Amazon is eating the world. They are pushing into new physical areas with the acquisition of Whole Foods. They are rolling out immediate delivery services like Amazon Prime Now. They will soon be launching their own lines of food products.
Bezos’s dream of creating the everything store is becoming a reality.
And as much as they have already revolutionized ecommerce, the true disruption is yet to come.
I’m talking about zero-click buying.
Amazon already prides itself on having a fast check out experience. You can even have a one click to buy option. How could the ecommerce experience get any better?
Do you see those recommendations on the product page where it says “people also bought”?
Now imagine that these suggestions aren’t just there when you buy the product online, they get delivered with the product when it arrives at your house.
This is zero-click buying: Amazon sending you things that they believe you will want. If you like it, keep it and your card is charged. If you don’t want it, send it back in the box free of charge.
In order for this to be possible, a few things need to come together.
1. You need to believe that it’s the correct price
A lot of shopping comes down to evaluating the deal. Am I getting a good deal or is it available cheaper somewhere else? Or, is the product I’m buying a good value or should I consider a different brand.
For Amazon to ship something to you without you asking for it, there needs to be a relationship built on trust where you believe that Amazon is giving you a good deal on this product.
Amazon has long been known as an affordable marketplace. It’s margins are famously low and because of the choice and marketplace competition, consumers can safely assume that the product is probably the cheapest they can find, or, if not, at least it’s on the cheaper end.
2. They need more logistics
Like I mentioned above, Amazons margins are notoriously low. They operate a taut supply chain that is sensible to the slightest shocks to the system.
In terms of delivery, Amazon is rolling out services like Prime Now with their own delivery personnel in major cities.
This last-mile network enables them to control the experience from web to home.
But in the vast majority of cases, delivery is one way. In order to enable zero-click buying, Amazon will have to figure out economical ways to return unwanted products.
Of course the answer is all in the P&L. And maybe drones will help in certain areas.
3. They need more data about you
Product recommendations are much simpler than recommendations for people.
I recently bought “Mediations” by Marcus Aurelius. The recommended products where other ancient philosophical tomes like Socrates’ discourses. Makes sense.
But if you look at my reading history (I buy all of my books on Amazon) I have recently ordered Junky by William S. Burroughs, Cat’s Cradle by Kurt Vonnegut, Start With Why by Simon Sinek, and A Clockwork Orange by Anthony Burgess.
Try to create an algorithm that can recommend a book for me from that data set.
Amazon has much more data than that of course. It knows that I order diapers for my son. It knows when I started ordering diapers. It can probably figure out the age of my son.
It could probably send me a pack of three blue onesies sized 18 months and I would be super happy.
Like any recommendation system, the more imputs there are, the better the outputs. In order to recommend thing to me as a person, Amazon is going to need to know me through and through.
Why does all of this matter?
Think of the marketing opportunity!
Instead of advertisements promoting a product, I could identify a segment of Amazons audience and send my products directly to them.
The entire concept of ad + consumer + store + product + purchase will be cut down to consumer + product + purchase.
What’s more, the hurdle of people hesitating to buy online until they get to see and feel the product in their hands is eliminated entirely.
Or imagine retargeting. Right now retargeting works like this: I see a product page, but I don’t buy. I go to a different website and on that website I see a banner ad for the product I was just looking at. Retargeting is effective because it can pull people back in to the sales funnel.
Image retargeting in a zero-click world. I visit a product page, but I don’t buy. A few days later, I receive the product at my house to decide if I really want it.
A vision of the future
And all of this will add to our daily consumption. People will start to look forward to the Amazon delivery guy bringing the week’s selection of products to try out.
Fashion companies will pre-emptively send a set of pieces from the latest collection.
Food companies will send you bigger formats to consume, along with free samples to try out new product innovations.
Car companies will send you antifreeze right at the start of winter.
You will no longer have to keep up with the world, everything you need will be automatically sent to you.
And instead of paying for ads on an ad server and targeting segments, marketers and brands will bid to be able to send you things.
Of course you could opt out, but why would you? No one wants to go out and run errands to pick up things that you need. So at the very least you will select only functional goods and let Amazon deliver you bug spray at the start of the summer, charcoal for your grill once a month, lawn fertilizer in the spring, and the latest in-season vegetables all year long.