“The complex and subtle forces applied by competing channels, supply chains, regulations and consumer interests – each of these factors subject to rapid and surprising changes – makes prediction a broad and long-term game,” explains Danny Silverman, CMO at Edge by Ascential. “To give our brand manufacturers clients the most strategic information for their ecommerce optimization strategy, we haven’t limited ourselves to Amazon’s short-term goals. Instead, we’ve broken our predictions out by distance: what’s around the corner, what’s down the street and what’s a few blocks away.”
Within one year, Edge by Ascential predicts that Amazon will introduce a major search algorithm update and significant innovation in the display segment of Alexa to address minimal adoption as a shopping channel. Within the next two to three years, Edge’s ecommerce experts expect to see major category expansions in grocery (driven by the addition of more Whole Foods and Amazon Go stores) and health (driven by the acquisition of PillPack and the formation of a health care company in partnership with Berkshire Hathaway and JPMorgan Chase & Co). Within five years, Edge by Ascential predicts the monetization of Amazon’s proprietary technologies and infrastructure including Go, Alexa and its distribution network.
“Once Amazon’s last mile capabilities are fully established, they will not shy away from competing for business with legacy distribution players,” explains Chris Perry, vice president of globalexecutive education at Edge by Ascential. “Similar to how the AWS infrastructure was originally built to support Amazon’s digital ecosystem and later monetized as a cloud computing platform, Amazon’s physical infrastructure, built to support its supply chain and fulfillment, will eventually be sold to brands and retailers as a logistics solution.”
“Amazon is very methodical,” explains Pete Andrews, director of insights at Edge by Ascential. “If you’re paying attention—and we are—nothing they do will come as a total shock. Whether it’s an acquisition, a private brand expansion, or the monetization of one of its proprietary technologies, any major announcement will be preceded by months or years of data collection and testing. By monitoring Amazon’s activity at all times, we can get a strong idea of their next moves.”
Read Edge by Ascential’s full 2019 predictions here: 11 Edge Predictions for Amazon in 2019.