How brand, not price, will win the Amazon war

Edward Crossin, group marketing manager, Automotive Holdings Group
By Edward Crossin, group marketing manager, Automotive Holdings Group | 1 May 2017
Edward Crossin

Amazon, the heavyweight retailer of the world, is coming and Australian retailers are gearing themselves for an industry shake up.

Consumers will savour the convenience, savings, speed and algorithm smarts that an Amazon shopping experience is promised to deliver. Consumers will win, but what will be the tale of retail operators, big and small?

Questions abound.

How will they prepare for the change? Is their firewall of competitive advantages enough to retain customers, without losing market share to the American Goliath?

Change breeds fear but it also breeds innovation and opportunity.

For most retailers, Amazon’s arrival is frightening, particularly for the likes of Harvey Norman.

Gerry Harvey, who once declared that the internet was a fad, has so far displayed sabre-rattling intent in the battle for the consumer dollar.

Harvey Norman’s problems began when it was out of step with the digital era. With a focus heavy on bricks and too light on clicks, the retailer has been playing slow catch up.

Getting the digital plumbing right is vital for retail relevancy. This includes a high performing website and a positive digital footprint. These elements are now considered standard. But it’s not enough.

So is a price war the path to victory? Harvey would agree. He has vowed to “match or beat” Amazon’s prices.

If this statement is representative of how other retailers intend to win, then they are doomed. Because price is a race to the bottom. There’s nowhere else to go, but down.

Instead, it is brand that will win the race to the top. It is brand, which is being human, being personal and being different, that will enable Australian retailers to win the war.

But, Amazon is also a brand, and it's one of the largest in the world. However, it is a brand that does not have the hallmarks of one that resonates and connects. Do consumers feel an emotional connection with a brand because it’s fast and cheap? I doubt it.

Retail brands must not lose sight of their brand and the history of customers who are connected with that brand. Branding is a trust mark and the currency of trust is a value that never diminishes. 

Consumers crave the unique, the human and the remarkable. Amazon doesn’t have that connection and there lies the opportunity.

The focus should be less on competing, and instead on being more human and more remarkable.

Retail in Australia is full of success stories of brands that have thrived in being more human and more remarkable.

The simplicity of Bunnings’ Saturday morning sausage sizzle is a case in point. It’s a ritual that drives community engagement. It’s a low cost activity from a national retailer which delivers local goodwill and forms an emotional bond with the brand.

In the burger business, experts would say that it’s an overcrowded market, dominated by established brands. But the founders of Melbourne's Huxtaburger didn't let that put them off. With a restaurant background, the Huxtaburger team backed themselves and created a remarkable product and brand.

The emerging franchise also differentiated itself by producing its own book The Huxtaburger Book: The Art and Science of the Perfect Burger.

What’s the common theme of other successful retailers like Nourished Life, Vinomofo and Gelato Messina?

They differentiated themselves in an established market and product category. Through creating a difference that resonated with customers, they are winning.

A great brand is indispensable. It cannot be copied. It doesn’t play the fast and cheap game. A great brand plays a higher game. A different game. One that is sustainable and for the long term.

Against Amazon, it’s the only game.

Edward Crossin, group marketing manager, Automotive Holdings Group

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