With reports that Amazon has 49% of all retail online spend you need to sit up and take notice.
It's does not have to be a disaster for your business. There are many companies who do incredibly well competing with Amazon. Here are four ideas: I bet you have many others.
1. You just cannot get beat on price for everything. You will soon have a deserved reputation that you are too expensive. Be clever- price match the most popular items.
2. Don’t just give up profits. Fund your price match and your other critical investments by figuring out how to manage the lost gross margins from price reductions. Get your teams to do the analyses and they will get the tactics to fund investments in other areas. E.g Bundle low margin items with higher margin items.
3. Know your customers better than Amazon. Yes, Amazon has the data but so should you. Use it. The data that you collect from your online business should power your off-line business. As a business leader you need to have a direct line of sight to your analytics team. If you are not experimenting online, sharing the insights and learning then prepare to be Amazonized.
4. Anticipate customer needs: this does not mean asking them. It means being two steps ahead of them. This is really, really hard but it can be the difference maker- Best Buy’s Geek squad branding as your personal CTO is a great example.
Remember to go deep: Amazon will usually be a mile wide and an inch deep creating opportunities for your business.