With “Go,” Amazon identifies another job it can do better–Lou Shipley

MIT Sloan Lecturer Lou Shipley

MIT Sloan Lecturer Lou Shipley

From Xconomy

Early last year, I “fired” talk radio along with NPR’s morning and evening editions. That same day, I “hired” Amazon Audible as my commute companion.

It wasn’t a difficult decision. Audible is far better than its predecessors at doing the job I need done as I travel to and from my office – provide on-demand access to an array of rich, custom content.

I got to thinking about that firing-hiring recently when reading an article about Amazon’s new “Go” concept: a quick-stop grocery and convenience-meal venture that will allow consumers to grab what they need off the shelves (Amazon’s Just Walk Out technology tracks what’s added to the shopping cart), confirm the purchase, and leave without ever standing in a checkout line.

I fully expect that Amazon will be as successful with “Go” as it has been with so many other game-changing retailing innovations since it turned the book-selling business upside down and sideways at the dawn of the Internet revolution.

With “Go,” Amazon is demonstrating – yet again – its unique skill of understanding more deeply than anyone else the job that people need to be done and then leveraging technology to disrupt, innovate, and differentiate its offering.

Through a planned nationwide network of 1,800-square-foot “Go” stores Amazon is taking aim at a share of the $650 billion per year U.S. grocery market. A mere 3 percent market share for the world’s #1 online shopping destination would add a healthy $20 billion to Amazon’s total annual sales, which topped $100 billion in 2015.

Amazon’s initial target market with “Go” is the millions of consumers who make quick stops at different times during the work week for a bite to eat, to fill-in their grocery needs – i.e., milk, bread, snacks – and to purchase take-home meals for a family dinner. Regarding the latter, consider the square footage your grocery story devotes these days to higher-margin, pre-made meals – everything from breakfast and lunch offerings to soups, salads, and several-course meals.

Read the full post at Xconomy.

Lou Shipley is a Lecturer at the Martin Trust Center for MIT Entrepreneurship at the MIT Sloan School of Management.

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