Shopper Marketing - January 2017 - 44
dominated digital world, CPG brands and retailers must integrate their online and offline
strategies and provide a seamless customer
experience across all touchpoints. The savviest are already engaging in omnichannel
initiatives including endless aisle, ship-fromstore and click-and-collect.
As part of that experience, traditional retailers can gain an edge by playing up the
"touchy-feely" aspect of brick-and-mortar,
which Amazon has yet to master, judging by
its physical bookstores. Modeled on Amazon.
com, Amazon Books faces all the book covers
outward on the shelves - a "visual echo" of the
web store's thumbnail images - and includes
the Amazon.com star rating, customer reviews
and additional reading recommendations,
Nicholas Carr writes in Technology Review. His
verdict: The physical store delivers uniformity
but comes across as a website "annex" devoid
Supply Chain Efficiency
The convenience aspect is another matter.
At Amazon Go, shoppers simply tap a turnstile to log into an app, and the system tracks
them through the store, logging their selections as they go along. The system uses camera surveillance and RFID scanning as well as
sensor fusion (combining the camera's imaging with other data such as an item's weight)
and learning algorithms that add a shopper's
past behavior and purchases to help ensure
item-identification accuracy. The data gathered would obviously be useful to CPGs and, if
licensing is in the works, to retailers.
Across retail channels, Amazon is forcing advancements not only in technology but also
SHOPPER MARKETING JANUARY 2017
in supply chain logistics. To sell on Amazon.
com, vendors must comply with "very detailed
instructions" pertaining to pallet shipments,
product labeling and other requirements
unique to Amazon, Gamboa says.
Then, there's the challenge of demand volatility and avoiding stock depletion so Amazon Prime can consistently come through with
Those are just the supply chain improvements required to sell on Amazon. To compete
with Amazon, CPGs and retailers must reduce
transportation and shipping costs as well as
delivery times. Offering fast, free shipping,
Walmart's Shipping Pass is the superstore's
answer to Amazon Prime. To shorten shipping
distances, hundreds of Target stores function
as mini-fulfillment centers where employees
pick, pack and ship Target.com orders from
P&G keeps supply chain logistics in mind
from the product design phase, overcoming
laundry detergent's presumed inability to return a profit for Amazon by developing Tide
Pods in a lightweight pouch, Burdick says.
Embracing Outside Sellers
"Supply chain is the key enabler of e-commerce
and the key to competitiveness as opposed to
marketing," which CPGs tend to overemphasize, says former Amazon manager Neil Ackerman. He is now global director of integrated
supply chain, e-commerce and tech innovation at Mondelez International, which owns
such powerhouse brands as Nabisco, Oreo and
Another promising opportunity for pushback is through third-party sellers. Following
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