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The Final-Mile and its factors for ecommerce success or failure

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3 minute read

Online retailers face an uphill battle in securing new customers. More than one hundred thousand websites launch every day . Many of these websites serve market niches – meaning it’s becoming increasingly difficult for general ecommerce sites to maintain market share against specialized retailers.

Brick-and-mortar stores are fending off competition by recruiting entertaining, empathetic employees. This human touch is great for physical retail, but how can ecommerce sites deliver the knockout punch in their space?

Amazon is winning by focusing on the “final mile” in commerce

Amazon, the third largest retailer in the world, provides a shining example for both established and emerging ecommerce brands. The key is in what they call the “final mile”. This refers to both the physical and virtual distance between them and their customers. 

Local Warehouses and the Acquisition of “Whole Foods”

Amazon understands that their customers want their products as quickly as possible. The one thing that physical retailers beat Amazon on is the ability to deliver instant gratification. To combat this, the ecommerce giant has invested heavily in three key areas:

  1. The creation of their own Uber-style package delivery service in metropolitan areas.
  2. AI-influenced local warehouses with products likely to be ordered by customers in nearby neighborhoods. 
  3. The acquisition of physical retail spaces, like Whole Foods, to blur the line between ecommerce and physical retail. (They are repurposing some of the warehouse space in their Whole Foods locations to serve as local warehouses as well.)

Delivering a Compelling, Personalized Online Experience

The addition of local warehouses and on-demand package delivery certainly helps them shorten the final mile. However, optimizations in the physical final mile are useless without first ensuring that the order is placed with Amazon’s platform, instead of a competitor.

This is referred to as the “digital final mile”. The key to winning customer loyalty is personalization – and Amazon excels here too. 

Serving up product suggestions based on past user history

This might not sound like an earth-shattering idea in ecommerce, but Amazon continues to refine their approach and serve as an industry leader in personalization of the online customer experience. 

In fact, Amazon is so ahead of the pack that they have created a machine learning service for AWS subscribers that provides a state-of-the-art personalization engine for their projects. Unimaginatively, it’s called “Amazon Personalize”. The earth-shattering aspect of this is that developers get to leverage what Amazon.com has learned over more than a decade of delivering a personalized online experience.

That amount of knowledge and refinement is nothing to be sneezed at. And based on a few conversations with companies that use AWS, Amazon Personalizewas a deciding factor in choosing AWS over an alternative like Google Cloudor Microsoft Azure

Leveraging Video Content to Communicate Value in an Engaging Way

Amazon is a platform where virtually anyone can sign-up and sell their products to Amazon’s extensive user base. Sophisticated product marketers realize that their biggest competition comes from within the Amazon platform itself – in the form of other sellers selling the same or similar products. 

An entire book could be written on the art of producing compelling product videos. Assuming a seller has created an informative Amazon product listing and engaged a professional team to create a killer product video, the next most important step is uploading the video to Amazon.

It’s a relatively simple process, yet, Amazon limits the types of video files it accepts in order to ensure fast loading on customer devices. I personally recommend using an online video converterto get around the hardware bottlenecks of most computers. The final product needs to be in one of the following formats:

  • 3GP
  • AAC
  • AVI
  • FLV
  • MOV
  • MP4
  • MPEG-2

Amazon is dominating ecommerce by transforming the final mile – both physically and virtually. They are blurring the lines between online and physical retail with strategic acquisitions. 

To ensure they win customers’ orders, they are continuing to enhance their efforts to personalize the customer experience – including everything from product suggestions to encouraging sellers to leverage compelling product videos.

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