retail news in context, analysis with attitude

by Kevin Coupe

Over the years, there have been few words as associated with Amazon’s broad strategy as “ecosystem.” Almost from conception, as Amazon expanded beyond its original focus on books, the idea was to create a structure that wouldn’t just make it easy for people to buy stuff, but would be integrated into their everyday lives.

Which is what makes this story from the Wall Street Journal so Eye-Opening:

“While Amazon’s smart-speaker competitors, Alphabet Inc.’s Google and Apple Inc., are striving to grow their user base by luring individual buyers with more elegant or higher-quality products, Amazon has figured out a way to get into millions of homes without consumers ever having to choose its hardware and services in the first place. Amazon’s Alexa Smart Properties team, a little known part of its Alexa division, is working on partnerships with homebuilders, property managers and hoteliers to push millions of Alexa smart speakers into domiciles all across the U.S.

“Amazon is hoping to find a new way to build market share by offering discounted hardware, customized software and new ways for property managers to harvest and use data.

“For Amazon, the appeal is obvious: Adding millions of new users to its services and gaining access to data like their voice-based wish lists and Alexa-powered shopping habits will put it further ahead of the competition which, at the moment, doesn’t have a significant presence in rental properties and new-home construction.”

The idea is that over the long term, people won’t just be able to control their homes via Amazon-powered devices - they may also be able to request repairs and even pay their rents.

It isn’t just about making life easier for residents. It also is about Amazon being able to gather data that will make it more effective and efficient … which will, of course, expand and deepen its ecosystem.

And, it isn’t just about residences. Marriott, the Journal writes, “is the launch partner for Amazon’s Alexa for Hospitality service. Amazon is building out dashboards for Marriott and any other hotelier that wants to use its service. These hubs for data and insight will allow Amazon to measure and pass on information about ‘guest engagement’ with the in-room Alexa devices, which will be capable of doing everything from making restaurant recommendations to adjusting the thermostat and ordering fresh towels.”

And again, the Eye-Opener, courtesy of the Journal:

“All of these partnerships are consistent with Amazon’s larger strategy, which is to get more people using its services and locked into its Alexa ecosystem. Ultimately, even the presence of Echo speakers might not be necessary to continue the expansion. Amazon offers Alexa to any manufacturer who would like to integrate the service into its products.”

The ecosystem expands and deepens, and competitors to Amazon have to figure out how to traverse it, challenge it, short-circuit it, or take advantage of it.
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