How Amazon Prime Air’s Takeoff Will Affect Brick and Mortar Stores

“One day, Prime Air vehicles will be as normal as seeing mail trucks on the road today,” boasts Amazon after the unveiling of their new Prime Air project on 60 Minutes.

This project is essentially a new package delivery service that would use small, unmanned aircrafts – or drones that are lovingly called octocopters due to their 8 spinning blades.

The idea is that after customers click the buy button on the Amazon website, a drone would be sitting at the end of a conveyer belt in one of Amazon’s 96 fulfillment centers waiting to pick up the package in a small yellow bucket.

Given that the package is 5 pounds or less, which currently accounts for 86% of shipments, and within   a 10-mile radius from the fulfillment center, the drone would be able to fly through the air and drop off the customers’ packages within 30 minutes.

The goal of this new delivery system is to deliver packages as quickly as possible and make Amazon the one-stop shop for all consumers – and while not explicitly saying so, completely change the rules of retail.

While everyone is “buzzing” about these futuristic fleets of whirring sky robots, how soon will it become a reality, and what will its impact be for brick and mortar retailers

Amazon CEO Jeff Bezos believes that the service could be running within four years, but Amazon will need to overcome some huge obstacles and a growing list of concerns for that to become a reality – first and foremost being regulatory issues with the FAA.

The Looming Question – Are Traditional Stores Facing Impending Doom?

While no one can predict the future with complete accuracy, Stephen Colbert wittingly proposes to Bezos that the future of retail resides with “spending habit opportunity places” or SHOPs – and as of now, it looks like he’s right.

Consumers still prefer in-store shopping, with 75% of consumers saying they would rather shop at a brick and mortar store that offered a customized shopping experience than online.

So even though many retailers may fear the threat of showrooming, e-commerce and now the potential of Amazon Prime Air, a new trend is on the rise that could be turning the tides back in favor of brick and mortar stores – laying retailers’ fears to rest.

The trend of “webrooming” – where consumers browse online and buy in-store – is growing, with 88% of consumers admitting to participating in this activity. 

This means that retailers have an opportunity to take advantage of changing consumer behavior by offering a customized experience through the development of a fully integrated omni-channel strategy.

Furthermore, based on an analysis of the purchase behavior of consumers living in 366 metropolitan areas, the majority of consumers prefer to have a balance of both online and offline shopping. 

This highlights the importance of not only having an online and mobile presence to drive more consumers back to brick and mortar stores, thanks to the growing trend of webrooming, but also of tailoring each shopping experience based on geographic location.

The Bottom Line

At the end of the day, while consumers are continuing to leverage online shopping tools to do product research, in-person interactions are still resonating with the majority – and online shopping cannot replace the in-store experience of actually touching and seeing a product before buying it.

Journey Awareness Persona C-Suite/Finance Real Estate Retail