Why would Amazon open physical stores?

Apr 10, 2016

itzik sadeh

VP Salesforce platform and ISVs at BALINK

“In an article I read recently, Amazon announced the fast-approaching opening of several physical US stores. The beta-site of the experiment started with a shop, which they opened in Seattle in late 2015.

Amazon, is not the only e-commerce player who is looking into the opportunities achieved through physical stores.

In the recent CeBIT conference, a leading fashion company shared a story about one of their customers. She was a woman, who ordered a jacket in the company’s e-commerce web site. The delivery’s expected date was 3 to 4 days. Within a few hours, the woman saw the same jacket in the one of the company’s physical stores. She came in, and checked that the store has the same size and color she wants (which were the same as she ordered digitally). Since she preferred to get one on the spot, instead of waiting a few days for the delivery, she asked the store manager whether she can get the jacket which she ordered by web at the store. The reply was negative.  Today, there is a clear “barrier” between the customer entity in the digital e-commerce world, and the physical world. To make things short, the episode ended with cancellation of the order, and an angry post on the company’s Facebook site.

The feeling that the “entire world” is moving to digital, and that retail companies need to put all their bets on improving the digital experience of their customers, is  inaccurate, to say the least. The story is more complex, and retail companies will need to maintain the fusion between the physical and digital experience for their customers.  Connecting the customers with the physical stores that they are visiting in, the employees who are serving the customers physically, the employees who are serving the customers over the chat, email etc. – are all needed in order to share the same relevant information. It is no longer enough to build a good customer application on the mobile, if it is disconnected from the entire set of business activities which are offered by the retail company. For example, if the customers makes a purchase at the store, he or she might also be entitled to a coupon for purchasing on the web, and vice versa. The store needs to know the purchase history of the client, regardless of whether the orders were made digitally or in store.

For that purpose, you need to build a retail solution which is built on top of a platform, instead of pin-point solutions for each community within the company (sales employees, service employees, clients, stores, partners etc.).

Salesforce is an alternative for building such a modern experience for its customers. With the Salesforce App Cloud, we are building together with the global Salesforce teams such solutions, which are used by top retail and distribution chains such as Louis Vuitton, Westfield, ALDO and many more.