At Shoptalk's inaugural event, one of my favorite panels was on the topic of "Innovations in Payments, Mobile Wallets and Point of Sale". This is largely due to the panel itself that included representation from:
Anytime you have representation from the largest bank in the US (Chase), the largest Internet retailer in the US (Amazon), the world's largest search and Internet company (Google) and one of the world's largest Internet payment companies (PayPal), you have a who's who list of leaders discussing how they see the future.
After this session, I had an opportunity to go even deeper in an interview with Patrick Gauthier, VP of Amazon Payments. During our time together, Mr. Gauthier made the case for why Amazon today is much more likely to be your strategic partner than your competitor.
Amazon Helps Merchants Grow Their Business, Not Put Them Out of Business
Much of the conversation at Shoptalk was around the digital revolution of retail. Companies that are succeeding are focused on the customer-centric journey. Which means that, as a business, you're focused on connecting with your customers where they are spending their time be it on their mobile devices (web or apps), social media, in-store, on your website and other connected devices (think Internet of Things). Sometimes this is shopping on Amazon and sometimes it's not. Why would Amazon help merchants to grow their business even when that growth is outside of Amazon's core platform?
"There's no conflict," says Mr. Gauthier. "Amazon shares the same values as merchants. The digital revolution of retail is good for the customer. The same appetite exists to create great experiences for customers. So we ask how can Amazon help you create greater consumer engagement? We want to help merchants grow their business by working together to create new experiences that increase consumer engagement."
Amazon is a Tech Company That Happens To Be In Retail
So the important question here is: Why would Amazon make it easy for its customers to shop elsewhere?
"Amazon is a tech company that happens to be in retail ," says Mr. Gauthier, "We didn't start out by looking for a competitive advantage, but rather we looked for what is annoying to customers. We saw that the uncertainty of when your orders would arrive was annoying to customers so we built out our logistics channel and ultimately began to offer that channel to merchants through Fulfillment by Amazon. We answered the important question, 'Where's my stuff' and made fulfillment predictable."
This helps provide insight as to why Amazon launched AWS and got into the web hosting and cloud architecture movement. As a technology platform, Amazon can absorb sales spikes when demand from a merchant's products surge.
"When Red Dress Boutique went on Shark Tank, we helped them absorb the spike in orders using Pay with Amazon," Mr. Gauthier explained. "30% or more of their customers are on Amazon and these are people who had never purchased from them before."
Three Things You Must Have Today
When building a successful eCommerce business, Mr. Gauthier believes you must focus on three things:
Are You Obsessed with Your Customers or Your Competitors?
Mr. Gauthier and I discussed the different focus areas a business can have. And that the most successful companies tend to obsess over their customer's needs and the overall experience they have with their company. By contrast, businesses that obsess over their competitors tend to be dominated by fear and usually don't put the needs of their customers first.
"When we develop a new product or service at Amazon, the customer journey is at the forefront," says Mr. Gauthier. "We'll make sure there is a footnote in the appendix section talking about our competitors, but it's not what we're focused on. To be successful in business today, you need focus first on the customer and what they want."
"When the Amazon customer buys online, they have certain expectations on how you buy, what type of recourse you have when you buy, and how fast things show up on your doorstep," Mr. Gauthier explains. "We understand the expectations of our customers and can ensure that the merchants who leverage our platform are delivering against these expectations. They benefit from the halo of trust that customers have with Amazon."
Amazon on Distributed Commerce
When I asked Mr. Gauthier about his views on distributed commerce, his answer was: "The way we define what we do, influences how we do it. The words we choose are very important. I'm always on the look out for terminology that doesn't help a customer. Our industry is littered with creating solutions in search of a problem."
We dug deeper into what's behind the idea of distributed commerce. In plain language, this is the idea that today's customers are empowered to buy wherever they are inspired to do so, be that inside of Pinterest, Facebook Messenger, or watching a video on YouTube.
"Today, commerce inside of a social network is not how the customer thinks," says Mr. Gauthier. "It's important that we be there on her terms at the time and place of her choosing. But it's the way the shopping experience is threaded together that matters. As platforms can inter-connect, the point of decision will vary by channel. The cost of experimentation is low in a connected world. This leads to the rapid invention of different things. Only by measuring everything will you know what works and what doesn't."
In today's connected world, you don't need to invest people and resources on running the technology. You can look to partners such as Amazon who can run the technology for you. As long as you put your customer's needs at the center of it all, you can experiment and measure the impact of new commerce channels that will increase your business.