How many of these tools can you name? Soon it may be zero. And that’s ok.
For you and me, it’s the golden age of online retail. The retail experience is the best it’s ever been. It’s more convenient, the prices are lower, and the service levels are the highest they’ve ever been. It’s a magical time to be a consumer. And it’s about to get even better.
As the battle for fast, free delivery of consumer goods to your doorstep draws toward a close, the next battle is just starting up and it will happen inside your front door. This is the battle to setup, install and assemble all the home goods and electronics you’ll ever buy. And Amazon is already playing to win.
There are three big trends that are driving the change in where the battle is being fought:
1 — Expectations have shifted — more people expect to be able to buy complete solutions and experiences — they want instant gratification not brown cardboard boxes.
Customer expectations are only going in one direction — and it isn’t down. The same customers who have become accustomed to 15-minute Dominos pizza delivery, an Uber in 5 minutes, and every movie / song they’ve every dreamed of available in 5 seconds expect solutions to problems to be available immediately.
2 — Technology has finally enabled the delivery of local services at scale. Technology has made it possible for consumers to expect more services.
Mass mobile data, online payments, geo-location, remote identity verification, etc. are the trucks, distribution centers and mega stores of services. Now that the technology and infrastructure that enables distributed services is ubiquitous and the demand is here, it is inevitable that platforms providing these services will exist.
3 — Installation and manual skills are in decline — (assembly, hanging shelves, drilling, electrical).
Craftsmanship / manual skills have traditionally been learned at work, school or home. Manual manufacturing jobs are in decline, vocational training in schools has hit rock bottom, and at home a culture of replacing broken products has dominated the inclination to repair them. There are fewer and fewer places for people to learn DIY skills.
Put simply: people expect more, technology has made mass service delivery possible and people have the skills to do less and less manual work. It’s time for retailers to help setup, install and assemble everything you buy.
The flip side of the change in the battle lines is that it’s a terrifying time to be a retailer. It’s a terrifying time to be a brand. It’s a terrifying time to be in e-commerce. Toys “R” Us is in bankruptcy. One of the strongest brands of our generation, Nike, has capitulated and is officially selling on Amazon. Calvin Klein has gone a step further and is offering certain products exclusively on Amazon. More than half of every incremental e-commerce dollar spent in 2016 went to Amazon.
While the landscape has changed drastically in food, fashion and consumer goods over the last five years, the home goods, furniture, and home improvement market has been left relatively unscathed by Amazon. Judging by their stock prices, The Home Depot, Lowes and others in their category have had a relatively easy ride for the last 5 years. That’s about to change.
About a third of all the hard goods people buy needs some form of installation or assembly. TVs need to be mounted on walls, blinds need to be installed on windows, furniture needs to be assembled, lighting needs electrical work. Retailers without services that turn the boxes they sell into solutions and experiences for their customer will have a serious problem very soon. Arguably they have this problem today.
Today Amazon is pushing further into home goods and is starting to offer free installation and assembly on certain products. On certain categories, installation and assembly will become what two-day shipping was in 2005 — something retailers need to offer to their best customers as standard or they will get left behind by Amazon.
It’s a wonderful time to be a consumer. Enjoy it while it lasts.
Disclosure: The author is the CEO of Handy. Handy has commercial relationships with major retailers in home goods and electronics. The author also has equity positions in major retailers.