I am sure that many of you have heard about some of the new directions that Amazon is taking itself. The list from recent memory includes jumping the price of their Amazon Prime service by twenty dollars a year, discussing using drones to deliver your orders faster than you could get a pizza delivered, increasing the offerings of their streaming service and most recently releasing Fire TV; a device to stream to your TV.
This mindset is anything but new for Amazon. When the company started, they were only an online bookseller. Today they have expanded to a giant company with a market cap of close to $150 billion. With that size, it is not surprising that they have the ability to simultaneously stretch themselves in many directions to see what is profitable and what has the potential to be their newest “bread and butter” operation.
The motivation for this post was Amazon’s newest announcement. They will be offering a home barcode scanner for ordering groceries. I have read about online grocery ordering and delivery services in the past, but there were always a few drawbacks that came to mind. For example, there are a lot of foods that I like but don’t know the name of the brand that makes them. I only recognize them when I am at the store. Another disadvantage to online grocery shopping is that many people shop by walking down the aisles and buy whatever food sounds good. They don’t have the faintest idea of what they are going to buy when they enter the store. This doesn’t really translate to an ordering online model, or at least it hasn’t until now.
With such a massive company trying their hand at online grocery ordering, I am sure that Amazon will find a way to provide an easy – to – use website to go along with the scanners so that the experience can be as close to going to the store as possible, without actually taking the time to do it. While there are drawbacks to this alternative way of grocery shopping, there are obviously a lot of benefits and I think that the scanners have the ability to eliminate many of the issues online grocery shopping presents.
Out of all of the recent directions that Amazon has been exploring, I think that this one is the most “out there” but also has a huge potential. Demand will be strong among those who live in a big city where transportation to a grocery store is an issue, as well as tech-savvy elderly or disabled people who find it too much of a hassle. It will really come down to Amazon’s ability to find a good pricing strategy that makes the service minimally burdensome financially but also profitable for them. If they can do this, I think they will experience a second wave of rapid growth while simultaneously making America a little lazier.