The demand side of this story is easy. As a former dog owner, I can assure you that there is nothing “experiential” about driving to Safeway and lugging 30lb bags of kibble back to the parking lot. Having it delivered to your front door is obviously the way to go. The supply side is more contentious and, as is the case for a growing number of industries, prominently features Amazon. Commentators are quick to reference addressable market size when prognosticating which product category will be next to fold to Amazon, but at least as important is the way in which the product is consumed. An ideally Amazonable product is one that is consumed in predictable fashion on a vast scale. Used cars are a large $740bn market in the US, but it is difficult to foster customer loyalty around a buying experience that takes place only once every 5 years, and decades hence, the notion that vehicle purchases will remain stable – in light of sexy trends like transportation-as-a-service and autonomous vehicles – is far from obvious. The US grocery market is also massive at $640bn, but the demand for groceries is highly predictable and the category offers a crucial entry point into the household.
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[ZO1 – Zooplus] Competing with Amazon
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The demand side of this story is easy. As a former dog owner, I can assure you that there is nothing “experiential” about driving to Safeway and lugging 30lb bags of kibble back to the parking lot. Having it delivered to your front door is obviously the way to go. The supply side is more contentious and, as is the case for a growing number of industries, prominently features Amazon. Commentators are quick to reference addressable market size when prognosticating which product category will be next to fold to Amazon, but at least as important is the way in which the product is consumed. An ideally Amazonable product is one that is consumed in predictable fashion on a vast scale. Used cars are a large $740bn market in the US, but it is difficult to foster customer loyalty around a buying experience that takes place only once every 5 years, and decades hence, the notion that vehicle purchases will remain stable – in light of sexy trends like transportation-as-a-service and autonomous vehicles – is far from obvious. The US grocery market is also massive at $640bn, but the demand for groceries is highly predictable and the category offers a crucial entry point into the household.