How will your customers react to the launch of Amazon in Australia?

Amazon-search“If you don’t like something, change it. If you can’t change it, change your attitude.” Maya Angelou

The Amazon juggernaut is coming to change Australian retailor so they say. There is also lots of conjecture over what their offering will be? What is their strategy? And how will they deliver it to the Australian consumer?

A great deal of debate, conjecture and for some, abject fantascism and equally many opinions are somewhat isolated from the opinion that ultimately matters most – being the customer

So, we decided, within our insights division at Retail Doctor Group, and supported by our partners at Lightspeed, to ask a wide range of Australian retail customers about Amazon.

What do our customers think about this launch? What will their reaction be?

Awareness of the Amazon brand was high however, the results also uncovered the lack of knowledge around what the Amazon proposition really is, with 38 per cent of Australians reporting not to be aware of the upcoming launch of Amazon, surprisingly millennials were even less aware.

Retailers where naturally 100 per cent aware.

Dig a little further into the fuller Amazon model and we see even less Australian consumer awareness.

Knowledge of Amazon Prime was murky for consumers when asked to define it, with 24 per cent thinking TV streaming, 15 per cent thinking delivery subscription and a whopping 47 per cent admitting they’re not sure. Likewise, Alexa hadn’t been heard of by 65 per cent of respondents and only 27 per cent knew it was artificial intelligence.

So, the process begins in earnest for Amazon to educate and convert customers, as all retailers need to do on an ongoing basis,

Security, trust, fulfillment, value add, community build and experience are the currencies of competition with Amazon. As retailers, focus on improving service offerings, simplifying order processes, accelerating the speed to customer while still retaining a focus on quality.

Only 22 per cent of consumers think Amazon will change their shopping behaviour. For those unlikely to shop at Amazon, the barriers were around a physical element as 33 per cent like to see, touch and feel the product before buying and 28 per cent prefer the shopping experience in a store.

This confirms what we already firmly believe, that building a one channel retail ecosystem is key to customer loyalty, as we like to say “Interaction before transaction”. Retailers should be dialing up their in-store experience and emotionalising their brand attributes to build their customer connection and loyalty.

During our recent event we asked some of the country’s most influential retail leaders some of the same questions we asked the consumers.

Interestingly, we saw that retail professionals think 97 per cent of their customers are likely to start shopping at Amazon post Australia launch versus only 57 per cent of consumers who report this intention.

Trust was a key area of difference between consumer and our retail leaders’ opinion.

93 per cent of the retail professionals said Amazon was a brand consumers trust, whereas consumers themselves rated this at 58 per cent.

Building your customers trust is key to customer loyalty, ensure you know everything about your customer. Knowing how to connect to them on an emotional level with strengthen their loyalty to your offering and brand.

During these times, it is imperative to understand consumers to better build quality strategy

The real risk lies with not understanding the changing customer needs and how to fulfil these, rather than Amazon itself.

The world of retail is changing and as retailers we must keep up, but how can we realise this change if we do not understand our raison d’être, our customer.

Anastasia Lloyd Wallis heads up the consumer insights division at retail consulting and advisory group, Retail Doctor Group, which is the Australian elected member of the global retail expert’s alliance Ebeltoft Group. Contact her on (02) 9460 2882 or [email protected]

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