What: An opinion article trying to figure out why Amazon is entering an ailing industry

Why it is important: This unprecedented venture is all about data and logistics, however, the question will be how radical Amazon will approach the construction of a new store knowing in advance its customer.

When Amazon announced that it was considering opening department stores locations, many analysts were baffled: why a USD 1,7 trillion e-commerce business would join an industry where it is estimated that by 2025, there would be 100,000 fewer stores in the US?

According to Forbes, the answer to that question does not lie in the assortment, nor in Amazon’s ability to differentiate from ither existing retailers. As Greg Petro, the author, states, Amazon is a logistics and tech company, and therefore uses the store as another interface made available to its customers to keep on servicing them in the most efficient manner possible.

The competitive advantage that Amazon has over, for instance, Walmart, is that it is literally building from scratch a store knowing already anything that needs to be known about its customers. It might therefore fuel innovation on the point of sales and the way it is operated. The author questions however Amazon’s ability to rethink from scratch the whole model, or only to improve it on the edge.

Amazon’s Department Store Disruption If You Can Beat Them... Why Join Them