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The Amazon Effect has completely transformed retail. Here’s what you need to know.

How the online retail giant influenced a monumental shift in consumer culture

Understanding the Amazon Effect

Amazon’s success can be attributed to its astute understanding of customer expectations. The retail giant recognized early on that customers expect a customized, seamless, omnichannel, fully digital, and connected experience wherever they go. 

The company realized that what was once considered acceptable, such as a 7-day delivery time, has become outdated in today’s fast-paced world. So, Amazon introduced policies that adapted to the new expectations, such as next-day and even same-day delivery options, which set a new standard in speed and convenience. Additionally, they implemented features like free shipping, one-click shopping, hassle-free returns, and personalized recommendations. 

These advancements have not only shaped customer expectations but have also transformed them. 

Customers no longer simply expect a customized, seamless, omni-channel, fully digital, and connected experience; they now demand it.

This phenomenon, often referred to as the “Amazon Effect,” has revolutionized the way consumers perceive and interact with retail. 

The Customer Experience Imperative

Consumers have responded to the Amazon Effect by prioritizing the overall experience above all else when shopping with a brand. That means regardless of how great it may be to interact with a retailer across various channels, if a customer has a poor experience in one of their physical stores, they are likely to take their business elsewhere. 

Dr. Barbara E. Kahn, an expert in retailing, emphasizes the importance of improving customer experience by either increasing pleasure or reducing pain points which she illustrates in her “Retailing Success Matrix” shown here.

Dr. Barbara E. Kahn “Retailing Success Matrix”

For retailers, this means prioritizing both eliminating pain points and increasing pleasure to meet and exceed customer expectations, ensuring a consistent and delightful experience across all touchpoints.

The role of next-gen in-store tech sale

To truly understand the impact of the Amazon effect, we must discuss the role that in-store solutions play in adapting to the new retail experience. 

Despite the rise of e-commerce and digital platforms, physical stores continue to account for an average of 87% of total retail sales. Meaning the importance of brick-and-mortar stores is more relevant than ever and the retailers need to focus on how stores can both reduce pain points and increase pleasure in the customer shopping journey.

Reducing pain points: The next-gen POS is the key behind reducing or eliminating customer pain points, as they offer retailers advanced functionalities that go beyond traditional transaction processing such as, mobility for line-busting, omnichannel capabilities that provide a seamless transition from online to in-store shopping, and inventory features— such as endless aisle— that get products into customers’ hands regardless of where the inventory is located.

Increasing pleasure: Modern clienteling solutions have revolutionized the customer shopping experience by arming associates with detailed customer insights so that they can provide tailored recommendations, anticipate needs, and offer a higher level of service. Through personalized communication channels, like mobile apps or messaging platforms, customers can easily connect with sales associates for assistance, product inquiries, or styling advice which helps foster stronger relationships between the customer and the brand.

Next-gen POS and clienteling solutions give retailers the power to center their stores around the customer, rather than the checkout.

Bringing it all together

The Amazon effect has undeniably transformed the retail industry, reshaping customer expectations and forcing retailers to adapt to a new reality. 

To thrive in the age of Amazon, retailers must embrace change, prioritize customer experience, and leverage technology to create a truly seamless and connected retail environment.

Implementing a next-generation POS system empowers retailers to center their stores around the customer journey and deliver personalized service that enhances the overall customer experience.

Learn more

For a deeper look into how the Amazon Effect has revolutionized the industry, watch this 30-minute webinar Navigating the future of next-gen POS adoption: Why retailers can’t afford to wait

Gain valuable insights on customer expectations, learn how retailers can adapt to meet these demands, and discover the pivotal role of next-generation POS systems in enhancing the overall shopping experience.

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