These Kiva robots are moving a ton of products inside the Amazon warehouse. But they’re not replacing people, they’re working with people.
The Fox has mentioned it before. The words flow from his pointy mouth quite easily.
“Don’t buy music from Amazon.”
It’s a pretty specific statement. Not much room for interpretation.
But sometimes his wife can only find some obscure song she’s looking for on Amazon.
And then it begins.
Not that iTunes is any gem, but iTunes generally behaves in expected ways and doesn’t get in the way when the Fox is trying to do something.
There appear to be some philosophical differences at Amazon.
Mrs. Fox generally hates computers, so after hunting down the song she’s looking for, she enlists Mr. Fox to go kill it.
This should only take a minute. Except it doesn’t. This does.
- On the Amazon website the Fox clicks the clearly marked button “Buy Now” next to the song. (Super easy! +5 points.)
- A pop-up window is displayed stating that to buy the song the Fox must download the Amazon Music player app. The Fox is not amused. He only wants to download an MP3 of the song he just bought. “Not so fast”, says Amazon. “We have an entire music playing application that you must have to get the most satisfaction out of that song.” (This is dumb. -5 points.)
- Reluctantly, the Fox clicks the clearly marked button to “Download the App”. (This is also dumb…of the Fox. He should have just quit right here. -3 points.)
- The app installer downloads and the Fox gets to experience the always exciting application installation process. This wouldn’t be terrible if the Fox was in the market for a new application. He’s not. (Total waste of time. -10 points.)
- The new Amazon Music Player app instantly and automatically (read: without the Fox’s desire, consent, or prompting) detects his giant iTunes library and automatically starts importing all songs. The Fox frantically looks for but can’t find any way to stop this. (Automatically doing things the Fox doesn’t want done is not helpful while also inducing anger like symptoms. -20 points.)
- Ignoring the annoying import taking place against his will, the Fox begins to look for the song that he just purchased. Surely it’s right here front and center. It’s not. It’s not anywhere. He searches, sorts, filters. Nothing. (This has quickly turned into an exercise in torture. -150 points.)
- The music player then alerts the Fox, via pop-up, that he must agree to the Terms and Conditions to use this new app that he never wanted in the first place. The only provided link in the pop-up says “View Terms and Conditions” and…wait for it…clicking the link launches Safari and opens a WEB PAGE! That’s right. The Fox has been thrown out of an app he never wanted into another app he wasn’t expecting to read a web page he never wanted to see. Oh to have been in the room while this experience was cobbled together. (Moving into the realm of pure disbelief. -1,789 points)
- The web page has one single banner talking about how awesome Amazon Prime is and how the Fox really needs to use Amazon Prime and Amazon Prime is really great and only losers don’t use Amazon Prime. At the bottom is a small link to view those terms and conditions he was told about, then a rather prominent button that says “Try Amazon Prime”. Now, read carefully. Under the prominent “Try Amazon Prime” button is text that says something like, “To agree to the terms and conditions, click the Try Amazon Prime button.” What? The Fox is stunned, feeling like he’s wandered into some 90’s era Gateway store full of cow-print boxes and Microsoftian crap-ware and devious up-sell quotas. How did I get here. Where the heck is that song I bought? Why can’t I speak in 3rd person anymore? (Dazed and confused -1,345,449 points.)
- Desperate to regain some slim grip on reality, (and out of some masochistic curiosity) the Fox clicks the “Try Amazon Prime” button feeling certain he can cancel whatever fee trial garbage he has unwittingly signed up for. The web page closes and he’s back in the Amazon Music Player app that is chugging away on his entire iTunes library, but still has no trace of the one single song he purchased through Amazon. (Do the points even matter anymore?)
- But wait, there’s more! The horrendously unhelpful music player has noticed that the Fox bought a physical CD for his dad six years ago via Amazon, and while the Fox was getting scammed into signing up for Amazon Prime, the app decided to start automatically downloading the entire album digitally. Haven’t we already had the talk about doing things automatically? What the heck is the Fox going to do with 21 The Best of Hank Williams songs? Certainly not play them.
- Still disillusioned, the Fox finds himself typing away frantically in the search bar to find the ONE AND ONLY song he cares about at all – the ONE SONG HE JUST BOUGHT. Nothing. The song doesn’t exist.
- Out of a maniacal compulsion to complete the full 7th circle of hell he’s wandered into, he goes back to Amazon’s website and actually…buys…the song…again. That’s right. The Fox has become more than willing to pay twice the price to somehow extract himself from this Amazonian technologist’s Rube Goldberg machine.
- Upon the second purchase attempt, Amazon’s website recognizes that the Fox already has the Super Crappy Amazon Music Player App that He Never Wanted TM and prompts him to download the song into said app. The Fox mashes the “Download Song” button with a ferocity that nearly shatters his mouse, the desk and the universe.
- He’s taken back to the Super Crappy Amazon Music Player App He Never WantedTM and his purchased song is displayed front and center.
As of this writing, the Fox has no idea if he actually paid for the song twice or just experienced Amazon’s standard music buying process.
With all the politeness the Fox can muster, he calmly tells Mrs. Fox they will never buy music from Amazon ever again. Ever.
With all the talk of the Amazon Prime drone delivery plan, it made the fox think of this original post from July 20, 2012. Steve Jobs and Apple may have trademarked the “Think Different” slogan, but Amazon is living it out.
How do you turn a judicial ruling against your company into a catalyst for mass-scale market disruption? You deliver better service than everybody else on the planet. The fine folks over at Slate.com give us the inside scoop on Amazon’s compelling strategy to turn lemons into lemonade.
Amazon has long enjoyed an unbeatable price advantage over its physical rivals. When I buy a $1,000 laptop from Wal-Mart, the company is required to collect local sales tax from me, so I pay almost $1,100 at checkout. In most states, Amazon is exempt from that rule.
No one can deny this strategy has worked well for Amazon over the past decade. But now those ‘physical rivals’ are fighting back.
In response to pressure from local businesses, many states have passed laws that aim to force Amazon to collect sales taxes. Amazon hasn’t taken kindly to these efforts. It has filed numerous legal challenges, and fired all of its marketing affiliates in Colorado, North Carolina, Rhode Island, and California. It also launched a $5 million political campaign to get voters to turn back the California law. And when Texas’ comptroller presented Amazon with a $269 million sales tax bill last year, the company shut down its distribution center in Dallas.
This sounds like standard protocol. Powerful entities (local governments) begin impeding on your bread-n-butter business plan, so you push back with all your financial might. (Read: throw a giant bucket of lawyers at the problem.)
But suddenly, Amazon has stopped fighting the sales-tax war. Last fall it dropped its repeal campaign in California and instead signed a deal with lawmakers to begin collecting sales taxes later this year. That was followed by several more tax deals—over the course of the next couple years, Amazon will begin collecting sales tax from residents of Nevada, New Jersey, Indiana, Tennessee, Virginia, and on July 1, it began collecting taxes from Texans.
Short term legal wins can actually turn into a losing strategy, and Amazon knows it can’t win by holding onto the past. So, instead, they unleash their creative leaders and turn their sights on creating the future.
Why would Amazon give up its precious tax advantage? Amazon’s grand strategy has [always] been to set up distribution centers in faraway, low-cost states and then ship stuff to people in more populous, high-cost states. But now Amazon has a new game. Now that it has agreed to collect sales taxes, the company can legally set up warehouses right inside some of the largest metropolitan areas in the nation. Why would it want to do that? Because Amazon’s new goal is to get stuff to you immediately—as soon as a few hours after you hit Buy.
That’s right. Amazon wants to corner the market on same-day delivery, one of the last pillars holding up the roof on brick and mortar stores. Amazon wants to make buying something online at 10am and have it waiting at your door when you get home the standard Amazon user experience. And if they can pull it off (and who better than Amazon to try), this will likely change the way we buy stuff forever.
Fox Tip: Companies that survive are filled with leaders who think different.
The quote below from a great article by Eugene Wei at Remains of the Day has been floating around the Internet describing Amazon’s low margin strategy as superior to Apple’s high margin strategy.
An incumbent with high margins, especially in technology, is like a deer that wears a bullseye on its flank. Assuming a company doesn’t have a monopoly, its high margin structure screams for a competitor to come in and compete on price, if nothing else, and it also hints at potential complacency. If the company is public, how willing will they be to lower their own margins and take a beating on their public valuation?
My concern is that folks are taking this quote, and the article as a whole as a denouncement of Apple’s strategy.
My initial thought is that both strategies are valuable and not necessarily contradictory.
For example, nobody looks at Mercedes Benz as having a bullseye on their flank as Chevy and Ford chip away at their customers on price. Porsche isn’t setting themselves up for failure against the likes of Fiat.
Apple has established themselves as a premium brand in consumer electronics. The aren’t in competition with cheap low end producers. They are in competition with other premium electronics makers…of which there really are none, leaving the low end producers as the only other option for consumers, thus making it look like direct competition.
There are plenty of folks who want a Chevy or can only afford a Chevy. Mercedes Benz is not targeting those consumers. And Apple is clearly not targeting $199 tablet consumers or $499 laptop buyers.