Amazon in Home Care: A Credible Competitor

Introduction

Scope

How Amazon’s revenue splits out (2016 Annual Report)

Three strategic pillars (drivers of both growth and profitability)

Best-in-class

Strengths that cause rivals the biggest concern

Are you listening?

Futurology

The value emerging

A ll under one roof

All the ingredients too

S trategic surprise circa 2016

Miele: advantages of “system level” strategy

System strategy: creating good shopping experiences

System-wide an overwhelming advantage

Amazon’s scaled “system strategy” virtuous circles

Existing and Emerging Activities

US strength and global risk

Amazon needs to expand beyond its existing core success areas

Amazon activity is one driver for internet retail penetration by sector

The most disrupted retail markets

Some reasoning (1)

Moderately disrupted retail markets

Some reasoning (2)

The retail markets that are (so far) least disrupted by the internet

Some reasoning (3)

Amazon’s efforts to break into the USD5.6 trillion grocery market

Food retail is a necessary milestone to winning across all of fmcg

Food and grocery formats being evaluated: fresh, Go and “Pantry

Shopping lists are among the most used functions of Alexa

Food/grocery formats being evaluated: Dash and DRS

New Home Services started in US, and fashion remains a focus

“Last mile” fulfilment investment continues

Droning on

Post office

On the “Side” of the Consumer

Simulation: a different cost base can drive price-based disruption

Not everyone is a fan

Robin Hood

On The “Side” of the Consumer

Disruption of the idea that brands and retailers are aligned

The decline in institutional trust

Empire of t rust

Trust and the value of genuine recommendations

Amazon Prime’s impact on value, loyalty and reputation

Containment Issues

Success rarely goes unpunished

S ervices competition

Distribution policies

E xtreme measures

Range

Choice example

Pricing

Even specialists struggle

Device competition

Loyalty programmes

Logistics

Jet set

These are all reactions to yesterday’s success…what is next?

Smart Home Power Position

Range depth in the Amazon smart home stores versus rivals

The relevance of data storage and brand-owned data clouds

Amazon “Dash” and a future vision of fmcg auto-replenishment

The Dash button: background and implications (1)

The Dash button: background and implications (2)

The Dash scanner: background and implications

Dash Replenishment Service: background and implications (1)

Dash Replenishment Service: background and implications (2)

Smart home, Echo/Alexa and new home care value considerations (1)

Smart home, Echo/Alexa and new home care value considerations (2)

Having hardware, consumables and services under one roof

Grocery cracked?

The latest virtuous circle: the attack on fabric care and apparel

Future Trends

Future growth

New disruptions anticipated in the industry from Amazon

Pre-emptive retail

Amazon’s share of home c are: Is it a credible future leader?

US and Europe

Is Amazon a credible future leader?

Competition in the East

Competitive threats

What could disrupt the disrupter: tax issues?

What could disrupt the disrupter: regulatory threats?

A big beast

What can disrupt the disrupter: profitability issues for Amazon?

Final thoughts

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