|Mon Jan 27 2014 11:35:44|
Would Amazon and Google Retail Stores Impact eBay?
By: Ina Steiner
Will Amazon and Google open physical retail stores, and what impact would that have on eBay? SunTrust's Bob Peck issued a report on Monday, "5 Reasons Google and Amazon Should Open Retail."
One reason Peck cited was to help consumers learn new technologies, including wearable technology (that was big trend at the recent Consumer Electronics Show). "Given the roll out of new devices from Amazon and Google, we think it would make sense for them to explore a physical retail strategy as well, rolling out their own stores. We underscore that the companies have not informed us of any potential plans, but we think it could make sense over time."
Peck referred to Google products: the Nexus line, Chromecast, Chrome books, Wallet, Google TV, and soon Glass and possibly Nest; and Amazon products: a whole family of Kindles and whatever other device it's working on - possibly a phone, according to press speculation. The devices "need to be experienced by consumers so they can understand them better and decide why they'd want to buy one."
However, he wrote, "The question is whether Google or Amazon need their own physical stores, or can they have a store-in-a-store in one of the large retailers ("store-in-store")."
While Peck barely mentioned eBay in his report, it's interesting to note that eBay is not looking to compete with retail stores, but rather, partner with them. eBay isn't working on developing gadgets for consumers, but on technology for retailers, such as point of sale systems and its "shoppable windows" - video screens placed in store windows to advertise items that can be purchased through eBay Now and delivered to buyers within two hours.
Peck made a case for why he believes Amazon and Google need physical stores, though he noted that he does not expect any imminent news.
One of the benefits to Amazon of opening physical stores cited by Peck that's most intriguing is the concept of "infinite inventory":
"Another possibility would be to have smaller but efficient stores (i.e., RadioShack), where consumers could walk in, play with the technology, and immediately order a product to have Amazon deliver it the same day / next day. This would enable the concept of "infinite inventory" within each store. For Amazon, this could also apply to more product categories than just Amazon branded hardware like Kindles. Consider the potential of showroom stores offering large selection of demo SKUs across many categories along with access to Amazon's global inventory, further helping change the way consumers shop."
In 2012, Charlie Rose asked CEO Jeff Bezos if Amazon would develop brick-and-mortar stores. Bezos said he would love to, but only if Amazon had a "truly differentiated idea."
Do you agree there's a need for Amazon and Google to launch physical retail stores, what would they look like, and how would that impact eBay?