Converting Blogs

It’s an e-commerce world (and we’re all just living in it)

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One of the more lively panel discussions at the 2018 TAPPI International Flexible Packaging & Extrusion Div. technical conference, held last month in Charlotte, NC, brought home the rapid changes afoot for e-commerce and the packaging that serves it. Participants included (in photo below) Manu Sareen, former gm-Amazon Private Brands (left); John Moritz, former vp-product mgmt. at Amazon (center); and moderator Jonathan Quinn, market development mgr.-PE Business at NOVA Chemicals (right).

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Here are a few Converting Curmudgeon bullet “points-of-interest:”

  • Amazon reportedly has about 300,000 business customers worldwide for many B2B products. These include super-niche items on discount, i.e.: high-end stethoscopes for sale in London, UK. About 900,000 such items are for sale on Amazon B2B. This makes it a major competitor to companies like Grainger. There are even third-party suppliers of various raw materials for manufacturing.
  • While the Amazon US site is similar to a brick-and-mortar retail supercenter, Amazon Prime Now is more like a specialty niche store. 50,000-sq-ft Prime Now hubs offer 2-hour or sooner delivery with 50,000 items available.
  • Expect further expansion of physical Amazon Go stores, which read RFIDs for cashier-less buying, in urban test markets. If Amazon opens a brick-and-mortar Go retail store, the first thought is to eliminate what consumers don’t like, such as waiting in line.
  • Amazon is starting to invest in its own private-label items and their corresponding labeling and packaging, i.e.: Whole Foods.
  • Artificial intelligence (AI) is boosting e-commerce growth in all its forms. Amazon AI and robotics are replacing “pick-and-place” human workers to assemble orders into bins. This allows the warehouse to carry 1,000s more SKUs. Your smart speaker in your car will remind you to go shopping for what you should be running low on.
  • It will be very difficult to deliver cold-chain items via Amazon regular or Prime Now sites. Consumers may not trust the freshness. Meanwhile, the instant gratification mentality of Gen Z members could transfer to Millennials and even Baby Boomers. The BOPIS (Buy online, pick-up in store) trend will only grow.
  • Millennials have trouble understanding why they can’t get every item in custom packaging sizes and quantities. They do want collection and recycling of all those delivery corrugated boxes, though.
  • Data security is a given today because multiple levels of breach access are possible. As more Cloud migration happens, more hacks will happen with data-center-stored information. Amazon is trying to design a system for a true “consumer failure-less” experience.

 
My Thoughts: From overnight delivery with Amazon Prime to 2-hour delivery with Prime Now, and cashier-less checkout via RFIDs at Amazon Go stores, it won’t be long before “life imitates art.” What I mean is, if all this e-commerce stuff with robotics actually happens, we’re all certain to turn into those obese passengers on the interstellar ocean liner in “Wall-E.”



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