Today’s Amazon purchase of Whole Foods is not necessarily surprising because it involves two large companies, but that it marks the beginning of many moves to come in the US market that follow the trend of O2O: Online to offline.
Online-to-offline is a trend that parallels the IOT (Internet of Things trend) — bringing networks and smartness to things that previously weren’t connected to the internet or even electronic. The online solution is easily scalable to take advantage of limited physical resources, allowing for “online showrooming” and offline purchase/pickup, leaving the customer with a complete shopping experience with lower overhead cost for the company. The phrase and concept, which is much more commonly used in China/Asia, hasn’t caught on like other acronyms. However, this deal may make that change.
Today, automated solutions can help very tangible, everyday things, and so the O2O trends combine the strengths of both worlds.
With this move, Amazon now has even more locations for people to pick up their groceries or other orders, integrating the in-person end stop of the online purchase, taking Amazon’s online inventory and pairing it with physical storefronts. Amazon Lockers hasn’t taken off as much as Prime Now and other on-demand services, but it provides infrastructure for more and more ways for you to get the items you want, the way you want it. And that is a win-win for sellers and consumers alike.
This move is one of the first of plenty to come, reversing the offline-to-online trend of purchases like Walmart of Jet.com, etc. that help automate the shopping experience. However, with Amazon making this kind of move, it flips the power of who is taking over what, slowly turning the tide to online to offline.
In this case, combining supply chains and delivery systems can bring synergies could lower costs for everyone, but the whole O2O trends may bring further marriages of online and offline giants to create a new purchasing landscape. Now that the precedent has been set, plenty more strategic moves may follow.
Originally published on my medium at https://medium.com/whatsthedealcalvin/with-amazon-whole-foods-deal-us-gets-feet-wet-in-o2o-click-and-mortar-stores-4a58d2864729
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