About a year ago, we had a post on Amazon Lockers — the Seattle firm’s attempt to solve recurring last mile problems. Customers could have their purchases delivered to a secure, nearby location. No need to sign for a package; no need to worry about someone walking off with your box. You just need to enter a code to pop open the locker that has your stuff.
But there is an obvious complication here: Those lockers have to go somewhere. Amazon’s plan was not to buy real estate but to plant them in existing retail locations. But which stores would benefit from hosting Amazon lockers? That is the question that a recent Businessweek article examines (Do Amazon’s Lockers Help Retailers? Depends on What They Sell, Sep 20).
The incentive for any business hosting an Amazon locker isn’t the monthly stipend the online retailer pays — "not even worth it,” says the manager of a Manhattan copy shop — but the lure of higher store traffic given the online retailer’s enormous sales volume and the gazillions of brown boxes sent across the nation each day.Amazon has the lockers in nine large metro areas and touts the delivery option as a customer convenience for the many people who can’t reliably get their online purchases at work or at home. For a bricks-and-mortar business, the idea is that people coming to collect their Amazon purchases will buy other stuff on their way out the door.
So do people buy other stuff? It turns out that depends on what else a store sells. Apparently both Radio Shack and Staples are dropping out of the program. As the article notes, a lot of what they sell is also available from Amazon making price comparisons a little relevant. 7-Eleven, however, doesn’t have quite the same issue and is considering expanding the number of stores that have lockers. Similarly, the article reports that the lockers have also worked well in cafés.
A spokeswoman for Philz Coffee, a San Francisco-based chain, says the lockers have proven most popular at its Berkley and Palo Alto shops, where university students had requested lockers so they could more easily collect their Amazon goods.
At several levels this makes a lot of sense. It is really not clear to me why Staples would have thought having Amazon lockers in its stores was a good idea. Anything that would make ordering from Amazon more convenient would seem to be counter productive. Conversely, for a café, anything that brings in, say, 20 or 30 extra people a day would be attractive. Amazon doesn’t do lattes so there is no direct competition.
There is one significant difference between Staples and a café, however. Staples stores are big with plenty of floor space. A cafe in a college town? That’s not so clear. That is, I would suspect for many places like cafés or convenience stores accommodating Amazon Lockers involves real tradeoffs since to fit them in means giving up some tables or some product display space.
Disclosure: Jeff Bezos is an investor in Business Insider through his personal investment company Bezos Expeditions.
This post originally appeared at Operations Room. Copyright 2013.
SEE ALSO: Ikea: Why Is It So Bad At Delivery?
Read more: http://operationsroom.wordpress.com/2013/09/23/who-should-be-willing-to-have-an-amazon-locker-in-their-store/#ixzz2g6w48Cp1
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