The Grapevine

How Big a Threat is Amazon to Your Business

June 17th, 2015

Is Amazon a threat to your wine shop? Is there any marketing you can do to fend them off? [level-members]

Wasn’t it just yesterday that we were extolling the virtues of the Duct Tape Marketing blog? Yes, I believe it was. And, as if to prove our point, they provide us with this gem of a post about Amazon, the threat it poses and what you need to do to fend the giant off.

First, don’t kid yourself into thinking that Amazon isn’t a threat. Web-based businesses are threatening all sorts of companies and jobs that thought they’d never be in danger of being outsourced or automated. (See radiologists and lawyers, for example.)

So, they are coming for you, and they are going to beat you on price, breadth of selection, and convenience. Here’s how to respond.

Don’t compete on price. It’s not just the web against whom that’s a losing strategy. It’s a losing strategy over the long-term against other brick-and-mortar retailers, as well.

Breadth of selection is a double-edged sword. Yes, Amazon is going to be able to offer more, but in offering more they also offer the very real possibility of creating “analysis paralysis” in their buyers. You’ve probably experienced this yourself. Walk into your local Best Buy and look at the wall of TVs and you may just turn around and leave. Even if you narrow it down to, say, just 42” LCD TVs, you still may have so many to choose from that they become indistinguishable.

If you focus instead on the quality of your selection and how carefully it’s been chosen, you can beat back at least some of the power of bigger competitors like Amazon.

Finally, there’s convenience. Chances are you’re not interested in letting folks browse your shop in their underwear the way Amazon does. But you can make shopping with you convenient in other ways, including getting to know your customers so you can guide them toward bottles they’re likely to enjoy.

As the Duct Tape Marketing article says, many local retailers are being out-innovated. Don’t be one of them. Play to your strengths and do all you can to minimize the strengths of your scariest competitors – like Amazon.