My general rule of thumb in discussing the future winners in global retail is that there will be two likely outcomes. The first scenario is that Walmart will remain the world’s biggest and best retailer if it succeeds in assembling a credible and coherent global e-commerce business. At present, Walmart has assembled something of a patchwork quilt of online businesses (both bought and built) with a very light central hand on the tiller. Some work to do, clearly, but the Bentonville giant at least appears to be heading in the right direction.
The second scenario is that Amazon will dominate the world of commerce if it only adds one missing magic ingredient. That missing magic ingredient is stores. While it might sound fancifully old economy, the presence of physical places where shoppers can go and look at stuff, buy stuff, collect stuff or return stuff is actually rather useful in today’s multi-channel, omni-channel or whatever you want to call it world of retail.
In the UK, home delivery is basically the very antithesis of convenience, as it routinely ends up with a frustrating wait in for errant delivery personnel or an equally galling queue on a Saturday morning at the local Royal Mail sorting office. While the former might have the silver lining of a day spent watching Jeremy Kyle or Cash in the Attic, the latter is devoid of any consolation whatsoever. With increasing numbers of workplaces becoming rather reluctant for their post rooms to basically serve as last-mile fulfilment centres for Amazon and other distance sellers, the onus is falling on Amazon et al to come up with an alternative.
It has already made some progress on the collection issue (if not the looking at stuff or returning stuff issues) through the installation of collection Lockers in shopping centres and travel locations. Kantar Retail has discovered that the Amazon Locker programme might be moving up a gear, with what appears to be the early stages of an alliance between Amazon and underachieving food retailer The Co-operative Group.
There are six Amazon Locker sites now active in Co-operative Food stores around the UK. So far, four of them are in Greater London (Chelsea, Parsons Green, New Malden and Edenbridge) with another two in the Manchester area (Stockport and Alderley Edge).
I popped along to the Co-op store in Chelsea to take a look, discovering a set-up that does actually make a degree of sense. The Co-op store (a former Somerfield for the benefit of fellow supermarket trainspotters) is a fairly big one for them, with an ample surfeit of space to play with. The Lockers are sited on the wall opposite the entrance, directly adjacent to an ATM and the checkouts, placing them in an ideally convenient spot for individuals wishing to complete a top-up shop at the same time as picking up their Pingu DVDs or copy of Infinite Jest.
The colour scheme of the Lockers appears to have been chosen with the express purpose of annoying litigation-happy Stelios Haji-Ioannou, but the garish livery does also make the unit very visible (much more so than earlier iterations of the Lockers in shopping centres).
It remains to be seen if this six-strong pilot with the Co-op moves beyond the current phase and into anything like a national partnership, but the initiative is an encouraging sign of Amazon’s acknowledgement that a physical manifestation will be of long-term benefit. For the Co-op, the Lockers are a much needed extra reason for shoppers to go to the retailer’s stores. We’ll keep you posted on progress...