June 25, 2011

The Future of Amazon?

What do you know about Amazon? I used to think they were simply a retailer, but I was wrong. Amazon is much bigger than that, it involves a much broader range of services. Do you know what Amazon Fresh is? It’s a delivery service of almost everything you want to buy from fresh products, meat, and seafood to diapers, DVDs, and toys – currently in the States. Do you know what Amazon Instant Video is? It’s a place where you can watch over 90,000 movies and TV shows online. I bet you didn’t know about Amazon Cloud Player that lets you play your music from the cloud on any Android device, PC, or Mac. 

Amazon has built an eco-system that cements its place in the world of digital and physical goods. I believe their business model is to become a one-stop shop and the only place for people to buy and consume anything online and offline on multiple touch points. In this article, I will outline some of the future opportunities that either correlate with market trends or provide potential opportunities and commercial benefit for Amazon. 

Mobile Payments
Amazon can get its millions of customers to use its mobile payment system and make use of Near Field Communication (NFC) technology. This will bring a much wider scale of data giving more insights into customers’ buying behavior and make the shopping experience for customers more convenient. It would be advisable though to wait for the mobile payments market to be more established and see how the public is responding to this technology.

Geo-located Deals
Amazon may enhance its presence in the deals market by providing its customers with relevant offerings and add location to it. Think of it as Groupon and Foursquare in one app. This brings in more data to understand the “commercial profile” of customers, and ensures Amazon keeps its customers and retailers from going to competition deals sites. In general, mobile will help in bridging the gap between the presence of Amazon online and offline.

The Kindle Tablet
Digital media is a critical element of Amazon’s eco-system. By creating a tablet version of the Kindle, Amazon would bring the interactivity of tablets to its digital media usage. This will create an extra, more interactive channel for viewing digital media content provided by Amazon such as video and music. The tablet would run on Android – judging by the fact that Amazon already has a Kindle app for the operating system, along with an app store and a cloud service that supports it. Amazon could undercut competitors by selling its tablet below cost and making up the revenue from sales of its digital content. However, this requires further research and investigation of the feasibility and cost of creating such tablet.

Where do you think the future of Amazon is heading? Let me know in the comments below.

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