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Big Business Does It Better?

December 1, 2014

Not necessarily, but some models don’t scale well.  You’ll have to hang with me for a second, but check out this post from The Register.

Amazon has suspended next day delivery in Blighty after reporting its busiest day on record.

This decision could mean the families of last-minute present hunters will go without gifts on Christmas Day, because The Reg understands express delivery will not begin until the New Year.

There’s a list of items that were ordered and not given options for next-day shipping.  Later in the article, you see this (but really, go read the whole thing).

Xavier Garambois, vice-president of EU retail at Amazon, was flabbergasted at the size of the Black Friday sales rush.

He said: “Ever since we introduced Black Friday to the UK in 2010, sales have increased year-on-year but this year really has surpassed all of our expectations.

“Black Friday and Cyber Monday are increasingly influencing EU online shopping, particularly in the UK,” said analyst Michelle Beeson. “These traditionally US sales days may seem irrelevant now, but retail heavyweights like Apple and Amazon have a track record of influencing consumer behavior and setting new standards in Europe.”

So, there are quite a few nice bits in here.  First, the efforts to introduce, “deals” goes worldwide, and it affects everyone who needs a bit of cheap (or expensive) junk in the same way.  BUY, BUY, BUY!  I suppose the need to have junk goes beyond national boarders.

(For the record, we did buy something this weekend.  We’re not immune.)

But more interesting to me is that Amazon doesn’t have the capability in their current model to scale to the level of retail logistics.  Mind you, this hasn’t been proven to be in America yet, but still, the model broke.

Amazon really isn’t doing anything truly revolutionary.  It’s still retail, just a much bigger store.  People go there to buy things and take them home, but the “go” and “take” are changed.  Amazon has counted on parcel delivery to be the last mile, and that appears to have broken in England.  We could probably dig around and find places in England where a store ran out of stock on something and disappointed the people who had driven or bussed there, I suppose.  But this makes the “revolutionary” aspect of the Internet a little more mundane, no?

So now here’s something to watch in the battle for the future of retail.  Will we see the last mile strain in other places as the increase in cyber purchasing rises?  Does this mean that the model is completely broken, and has to be redone (drone delivery anyone?) in the future?  Will people instead opt for getting back in the car for instant gratification?

I suspect this is a blip that will be corrected, but still… very interesting to read.

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