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Bloomberg has a story about the alliance between Amazon and Kohl’s, the department store chain that both sells Amazon devices in some locations and enables returns of Amazon purchases in many more.

According to the story, “By tying up with Amazon, the department store chain gets more foot traffic from those making returns, enticing them with coupons to browse the store and buy something. For Amazon, the partnership helps solve one of the trickiest challenges in e-commerce: letting customers return products without subjecting them to nightmarish lines at the post office. About 30 percent of all online orders are sent back, triple the rate of store purchases, and Amazon keeps looking for ways to make the process affordable for itself and easy for customers. Eventually, Amazon may add private-label groceries and apparel to the electronics it already sells at Kohl’s.”

While there is speculation that the alliance could turn into something deeper, with Amazon eventually acquiring Kohl’s, Bloomberg says there are real short-term advantages for Amazon:

“Amazon’s decision to deepen its relationship with Kohl’s is necessary in part because its own brick-and-mortar efforts are faltering. Sales at the company’s physical stores have barely grown since the 2017 acquisition of Whole Foods, despite highly publicized price cuts on things like organic asparagus and strawberries. With investors asking pointed questions on earnings calls, Amazon is prioritizing Whole Foods and expanding its AmazonGo cashierless stores, according to people familiar with the matter.

“That leaves the earlier retail initiatives languishing. Amazon will tell you that it’s simply experimenting as it does online, where tests come and go without most customers noticing. It’s much harder to hide its misfires in physical stores.”
KC's View:
Important to remember that, as Tom Furphy has said here on MNB, that Amazon’s misfires are not necessarily a negative. Sure, they’re more public because Amazon itself is bigger and more public … but they’ve always been part of the Amazon equation. (If you doubt me on this, just go online and check … it is easy to do so on your Amazon Fire smart phone.)

CEO/founder Jeff Bezos always has argued that as the company got bigger, the size of its risks and mistakes had to get bigger as well … the suggestion is that timidity and complacency are Amazon’s worst enemies.