Competing with Amazon: It’s All About the Trust
Amazon is big. Powerful, too. The vision of Founder and CEO Jeff Bezos is remarkable. It is astounding to consider Amazon’s ascension began just 26 years ago in 1994. While I don’t always agree with Amazon’s practices, I have a great deal of respect for Mr. Bezos as an entrepreneur, a visionary, and for the brand he has built. Amazon is a tough competitor. Competing against Amazon is not impossible, however, if you understand their vulnerabilities.
It’s no secret that direct marketers maintain a love-hate relationship with Amazon. Many of you have used and/or are using Amazon today. If you can’t beat ’em, join ’em, right? I think you can win against Amazon without drinking the Kool-Aid, though. To do so, you must look for their weaknesses, strive for consistent performance in your organization every day, and finally: take care of your customers.
The Erosion of Trust
I started noticing a change early in the pandemic. Amazon began reserving inventory of hand cleaners and other sanitary products for healthcare providers. As a trained volunteer firefighter and emergency medical responder in the State of Delaware, I very much understand the importance of taking care of first responders. What I don’t understand is that, with their vast global buying capabilities, why they couldn’t set aside some inventory for everyday consumers who are also trying to keep themselves and their families safe. That is not how you take care of your customers.
I also noticed Amazon was missing delivery dates. They promised 2-day delivery but didn’t deliver. We’ve all had to deal with postal delays in Q3, but there have been instances where the Amazon website showed that something I ordered was, “out for delivery,” yet it wasn’t.
The lesson here: Do what you say you are going to do and do it well. Exceed the customer’s expectations. It is sort of like being 15 minutes early for an appointment vs. 5 minutes late. Amazon is a phenomenal sales channel, but are they great at fulfillment? I used to think so, but I am not so sure today. I no longer have confidence in the delivery dates they quote.
There is now a major lack of credibility with regard to Amazon product reviews. According to Mike Prospero at Tom’s Guide (September 17, 2018), “Amazon’s product pages are infested with hundreds and sometimes thousands of deceptive reviews, and the schemes are getting so sophisticated that the retailer can’t keep up.”
In an article titled, “Technobabble: Can Amazon Product Reviews be Trusted” Jason Ogaard reported on September 16, 2020 that Amazon deleted 20,000 reviews from its store after it was brought to light that several reviewers were likely receiving free products in return for reviews. This is another trust factor. If you can’t believe the credibility of their reviews, it does not instill confidence in purchasing from them.
Fake products have also become all too common on Amazon. One reason for this is because most of the products sold on Amazon.com are not sold by Amazon, but rather third-party sellers. Most re-sellers can be trusted; however, some cannot. Fake products are far too prevalent on Amazon. The cold reality is that Amazon has grown so big that it is becoming increasing difficult for them to police every aspect of their site. Ganda Suthivarakom of the New York Times reported on February 11, 2020 that big brands like Birkenstock and Nike have completely stepped away from Amazon because of the deluge of counterfeiters.
I used to think Amazon had the best prices. Not anymore. There have been several items that I have competitively priced. I found the same items on other sites were priced equal to or less than Amazon. Don’t just assume the best price will come from Amazon; you might be surprised.
I am careful what I order from Amazon. Unless the item is sold by and shipped from Amazon, I generally won’t order. In fact, I search the Internet to see if I can find the items somewhere else.
Looking the Giant in the Eye
Providing unique and proprietary merchandise along with phenomenal customer service are two of the best ways to grow a business and to compete against giants like Amazon. There is no substitute for personal, friendly customer service representatives who take care of the customer. The focus on customer service provides an opportunity to increase customer loyalty by maximizing customer satisfaction. This is one area that can set you apart from Amazon and other competitors.
Is the bloom off the rose? It is my opinion that Amazon is no longer new, fresh, or exciting. Have they lost the dominance they earned over the years? Other giants like Walmart are coming after them. I also believe that specialty catalogs and online retailers can carve a niche for themselves.
To me, the most important factor in the shopping experience is trust. Once you lose trust, it is extremely difficult to get it back. My trust and confidence in Amazon have been shaken for the reasons listed above. Now, I try to find the merchandise I am looking for from other e-commerce retailers, even if the cost is a little higher.
And I’m not alone.