Retail expert explains when and why Amazon will fail

jeff bezos
jeff bezos
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You can think what you want of Amazon. However, one cannot deny the unbelievable success of the giant’s business in online retail. Now, however, Doug Stephens, retail expert and founder of Retail Prophet, predicts the company’s doom. On the economic side ““He explains when and why this will happen.

Because something similar happened to the American retail giant “Walmart” in 2015 – the year in which sales figures fell for the first time. With over 4,000 branches and a rapid increase in profits, the supermarket chain has failed to establish itself outside of its established business area: It has not jumped into online retail, says the economic expert.

The same could happen to Amazon – only the other way around.

Amazon has to think outside the box

So this is the first strategic mistake Amazon makes. People don’t just buy because they want as many goods as possible as quickly as possible. They want to go out, touch the products and weigh them against each other, want to get in contact with people and maybe try something new, be inspired.

Stephens thinks it is dangerous to dwell on structures; they can become encrusted too quickly. What was right in the last ten years does not have to apply to the future, times are too fast moving today.

Amazon will not pay enough attention to its customers

This problem builds on the first. When a company is founded, those responsible know why. They believe that is what customers want and what they need. If they are right, they will succeed.

That’s how it went at Amazon. Customers like the service that Jeff Bezos offers with his company – the only question is how much longer. It happens quickly that in entrepreneurship you lose touch with customers and their wishes. So while Amazon is focused on things like process optimization, it could be moving away from its actual mission. This is a weak point that can easily be attacked by the competition.

Amazon cares too little about a positive external image

You can tell from the way employees are treated in the company. It is about rationalization, austerity measures and the pressure that is exerted on the employees. If an employee no longer dares to go to the toilet because he is afraid that he will be criticized for poor work performance, then this is not only a problem for the work atmosphere in the company, but especially effective when it becomes known – and in an extremely harmful way.

Amazon’s partners will jump off

It was 2017 in Seattle when Amazon pitched for well-known companies. It didn’t have to promise much. Actually, the companies ran down the doors of the mail order business, reports Stephens.

The curious thing about it: At the same time, Amazon built up an industry with over 100 own brand products that are very similar to those of the newly added companies. Coincidence?

Probably not, says Stephens. If the business is carried out via Amazon, Amazon also receives the data, knows how high the sales figures are and which goods are most popular. It stands to reason that customers will move on to cheaper products. But this strategy will not be sustainable for long. Because in the long term, the partners will drop out and migrate to delivery services that really cooperate with them.

If the retail expert is to be believed, all of these factors mean that Amazon will suffer losses over the next decade. Who knows which company will then have taken their place.

This article appeared on back in November 2019. It has now been reviewed and updated.


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