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Could Amazon’s arrival be the shake up Australian retailers need?

 

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The news is out. Amazon, the world’s biggest online retailer, is set to launch in Australia at the end of 2018, offering consumers cheaper prices, faster delivery times, and access to thousands of products including groceries.

The true impact of Amazon is unknown until it arrives; however, it’s predicted that it will dramatically shake-up the Australian retail market, minimising in-store traffic while forcing retailers to drive down prices and tighten bonds with their customers in order to stay competitive.

But while Amazon promises to threaten existing retailers, it could well be the shake-up that Australia needs.

A friend of mine recently purchased an item of clothing online from a very well-known Australian brand. Ten days after making the purchase, the retailer contacted her to let her know that the item she ordered was unavailable.

The result of slow communication between the website’s back and front end systems meant the brand could not update the customer in real-time, leaving her immensely dissatisfied with the experience and without the item of clothing she believed she had successfully purchased.

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Shopping on Amazon very rarely results in scenarios like this because it has mastered the inventory and distribution model, a feat that is crucial in an age where time is a valuable and limited resource for consumers who want their goods ‘now’ in a straightforward manner and with minimal effort. This is where Amazon delivers.

To combat this, Australian retailers will have to re-evaluate their inventory models and distribution channels and further digitalise processes to make things easier for the customer and allow them to self-serve.

Amazon CEO Jeff Bezos lives and breathes customer service. Not only is he extremely accessible to his employees, customers can contact him directly via his personal email address if they are experiencing a problem. Amazon’s obsession with its customers filters from the top-down.

The ability to monitor customer behaviour is another huge strength of Amazon’s, with consumer data playing a pivotal role in providing a robust recommendation system, further enticing existing customers and increasing profit.

Online retailers are rapidly adapting features similar to this, however a customer-centric model of business and the ability of C-suite executives to prioritise the customer will be paramount to staying relevant amidst the arrival of Amazon.

Bricks-and-mortar stores might arguably have an advantage over the online giant in terms of in-store customer experience and the human touch—a critical element of customer service that is increasingly threatened by technology.

To hold their own against Amazon, not only will retailers have to enhance their in-store shopping experience, they’ll need to complement their in-store operation with flawless online channels to offer because consumers will expect to be able to choose how they interact with the brand.

Whatever the impact of Amazon on Australian’s retail sector, 2018 will certainly mark an exciting new era for Aussie consumers who will be offered more variety and an effortless customer experience.

customer serviceAnouche Newman is the CEO of the Customer Service Institute of Australia (CSIA), Australia’s leading independent customer service organisation.

 

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