As the world’s largest online retailer, it’s no surprise that its biggest fulfillment center in Phoenix, Arizona is the size of 28 football fields.
That’s because it’s their goal to have everything anyone wants at anytime.
Amazon has 80 fulfillment centers in the world to handle all of its orders.
Even though Amazon already has massive operations, it’s still planning to open at least two new fulfillment centers in California over the next year or so.
And with the holiday shopping season in full force, Amazon hired an additional 50,000 employees to help with the expected demand.
Thanks to Imgur user SippingTea’s incredible photos, we have a sense of that this incredible scale actually looks like.
Stacks of shelves line the warehouse
Employees need carts to navigate through the massive amounts of inventory
Hundreds of boxes full of products cover the floor
Could we be seeing the end of routine doctor visits?
Scientific American reports that researchers are testing a new system for electronic doctor visits that could potentially eliminate the need for patients to see a doctor for routine illnesses.
Patients would simply enter their symptoms and health record into an online system, and doctors would use this information to send a diagnosis and, when necessary, a prescription.
Early reports suggest that such diagnoses were just as accurate as those given in person, although there are still some kinks that need to be ironed out:
Researchers analyzed some 5,000 doctor visits for sinus infections and 3,000 visits for urinary tract infection. Less than 10 percent of all visits were electronic. One possible e-visit drawback: doctors were more likely to prescribe antibiotics after an e-visit than a face-to-face.
But patients with an e-visit had just about the same rate of follow up as those who had an office visit. Which suggests that there was not a higher rate of misdiagnosis or treatment failure online. E-visits were also cheaper.
Detractors will note that this program only applies to relatively routine illnesses, but even so, this is nothing to sneeze at.
One of the primary goals of Obamacare was to cut down on the use of expensive emergency room visits for routine medical care, which was clogging up emergency rooms and leading to millions of dollars in unpaid medical bills. This looks like a much cheaper and simpler way to accomplish the same thing.
Naturally, we’ll need to see more studies before these programs can be rolled out on a national scale, but this looks like a good place to start toward improving the ! efficien cy of the health care system. Massive, top-down reforms like Obamacare get most of the attention, but it is smaller innovations like these will do the most to shape the healthcare of the future.
It also seems clear that letting consumers benefit from cheaper prices is a way to push the health care system as a whole toward less costly methods. E-visits for routine problems (and ultimately, perhaps, e-visits to nurses rather than to physicians) can offer better, faster, more convenient service at a lower price. Moving in directions like this is the kind of health care reform we desperately need.
This holiday season, small retailers are leaving Groupon off their lists as far as sales strategy goes.
This shopping season is the biggest one of the year, and small businesses often rely on sales made during this period to bring them into the black as the year comes to a close.
A sales strategy that didn’t work during the rest of the year is out of the question for the holidays, says Pamela Springer, CEO of online small business network Manta.
This doesn’t bode well for Groupon and other daily deals sites. Only 3percent of retailers got repeat customers out of daily deals promotions, according to a survey Manta released Oct. 30.
“They’re doubling down on things that work, and leaving things that are less proven or they’ve had experience with and didn’t work off to the side,” says Springer.
If businesses aren’t getting repeat customers out of Groupon deals, they’re losing money, says Anthony Bruce, CEO of retail data analyzer Applied Predictive Technology. Groupon often charges businesses as much as half the revenue of a deal sale, which is usually a drastic discount already.
“If there are future purchases that occur because of a Groupon, that’s great,” says Bruce. “If it’s an incremental visit I wouldn’t have gotten anyway, it’s bad. If it’s a visit I would have gotten anyway but did it with a Groupon, that’s terrible.”
Jennifer Untermeyer says she won’t use Groupon this holiday season, because she lost money on the five daily deals she ran last year for her business, TravelKiddy, an online store that sells toys and games to keep kids busy during road trips or plane rides. She ran her first $10 deal for $20 of merchandise on Eversave last November, trying to snag holiday travelers, and ran four more similar deals on niche mom-! themed d eals sites, hoping to score new customers.
It didn’t work.
“We can tell how many people we’ve had repeat, and it’s eight or nine out of 3,000 deals,” she says. “We ended up in an overall loss, even factoring in the marketing benefits.”
Sales chief Kal Raman says Groupon helps businesses retain customers through its reward program, which is sort of like a frequent-flier program for customers. The program helps businesses track purchases a Groupon customer has made, and after a certain level of spending is reached, Groupon automatically sends the customer a free deal.
“We effectively become their loyalty-management company,” says Raman, who sees Groupon as a great way for retailers to sell inventory they’d otherwise be sitting on. “As a small-business owner, you can aim high, and we can hedge that risk.”
Will Ander, senior partner of retail strategy firm McMillan Doolittle, says liquidation is the only good thing Groupon does for small retailers. “It’s more effective than giving it to the Salvation Army.”
Smartphones and tablets continue to drive an increasing share of e-commerce traffic.
According to Monetate, mobile accounted for 18 percent of e-commerce traffic in the third quarter, up from 8 percent a year prior.
Smartphones drove a larger share of traffic than tablets, which reflects their increased penetration and perhaps the popularity of “showrooming,” when consumers use their smartphone in-store to compare prices.
Retailers, both online and brick-and-mortar, have to heed consumers’ changing shopping habits. According to IBM, mobile accounted for 16 percent of Black Friday online sales this year, up from 9.8 percent a year ago.
(For more information on mobile commerce, and how brands can win, read our special report.)
Walmart may be the king of retail in the physical world, but on the internet, it’s still a challenger.
Jeremy King, a Silicon Valley engineer who built key parts of eBay’s infrastructure, joined global retail titan Walmart in the summer of 2011 as CTO of Walmart.com.
Farhad Manjoo interviewed King for his great story on Walmart’s evolution at Fast Company, and the engineer described the “irresistible pitch” that CEO Mike Duke gave him over a videoconference call, luring him into the job.
Duke wanted to become more experimental — and he was making the moves to prove it. From Fast Company:
After years of seeing his company lag online, Duke swore that digital was now a priority for Walmart. Duke had restructured the company, placing e-commerce on equal footing with Walmart’s other, much larger divisions. He had made serious investments in high-tech talent, acquiring several startups. One, a 65-person social media firm called Kosmix with expertise in search and analytics, was the impetus for Walmart rechristening its Valley operations “@WalmartLabs.”
Duke was looking for people who would revive the company’s sites and services, and energize its entire culture. He hoped to turn a company famous for rigid, coldly effective business processes into one that’s flexible, experimental, and entrepreneurial. In other words, Duke wanted to inject a bit of Silicon Valley into Bentonville, Arkansas. In the summer of 2011, King signed up as CTO of Walmart.com. “We’ve hired hundreds of incredibly talented peop! le, in S ilicon Valley and around the world,” says Duke of his aggressive moves. “We are playing to win.”
King now heads @WalmartLabs — the company’s skunkworks. He has been tasked with bringing Walmart into the rapidly morphing world of e-commerce. That means reinventing the shopping experience — both in-store and online — and facilitating Walmart’s digital transformation.
And, judging by Duke’s pitch, it looks like he has his CEO’s full support.
What percent of online sales on Black Friday do you think came from Twitter referrals?
How about Facebook?
While you’re pondering those questions, here are some other factoids from a report on Black Friday online sales by IBM:
- The average Black Friday online shopper bought 5.6 items per order. That’s down 13% from last year. It’s also down 40% from Friday, November 16th, a week earlier. Hard to know what to make of that.
- The average shopping “session” length was 6 minutes and 39 seconds. That’s down about 10% from last year. Compare that to the average hellish shopping session in a physical store, and you’ll see why ecommerce is continuing to grow as a percent over overall retail sales.
- The “conversion rate” of online shoppers–the percentage of those who visited the site who actually bought something–was 4.58%. That’s up 9% from last year.
- Mobile devices (smartphones and tablets) accounted for 16% of sales. That’s up from 10% last year.
- Mobile devices accounted for 24% of site traffic. That’s up from 14% last year.
- iPads accounted for 10% of site traffic, up from 5% last year.
- iPhones accounted for 9% of site traffic, up from 5% last year.
- Android phones and tablets accounted for 5.5% of site traffic, up from 4% last year.
The key observations here would seem to be:
- Mobile is ! continui ng to grow rapidly as a percentage of traffic and sales, but it’s not taking over by any means. 6 years into the smartphone era, with smartphones now accounting for more than 55% of U.S. handsets, traffic to mobile sites (including traffic from tablets) is still less than 25% of overall traffic.
- Apple devices continue to crush Android devices in terms of commerce engagement. Android users just don’t seem to do all that much with their gadgets.
And now to social referrals…
It wasn’t long ago that many people were arguing that Facebook was eventually going to be bigger than Google. Word of mouth, after all, is the most powerful form of marketing known to man. And people lived on Facebook, so they would soon be shopping on Facebook. And so forth.
Well, so far, anyway, that ain’t happening.
- Only 0.68% of Black Friday online sales came from Facebook referrals–two-thirds of one percent. That was a decline of 1% from last year.
And how about Twitter?
A couple of years ago, people were excited about Twitter’s potential as a commerce platform, too.
But Twitter’s impact on ecommerce, it seems, is zero.
Not “basically zero.”
- Commerce site traffic from Twitter accounted for exactly 0.00% of Black Friday traffic. That was down from 0.02% last year.
So much for the idea that Twitter or Facebook’s business models are going to have much to do with commerce.
TED.com is just about the best place to hang out online if you have a few minutes to kill.
That’s because it offers free recorded lectures given by brilliant people doing amazing things in areas including technology, entertainment, design, business, science, and global issues.
And what’s cool about it is the talks are tagged so if you’re in the mood for something inspiring or funny, for example, you can get just the kinds of videos to do the trick.
Here are a handful of insightful TED talks posted this year that every entrepreneur should check out.
Shawn Achor explains how to change your perception of reality to produce better work.
Psychologist Shawn Achor doubles as a comedian in this talk, during which he says the lens through which your brain views the world shapes your reality.
“And if we can change the lens not only can we change your happiness, but we can change every single educational and business outcome at the same time,” he says in this highly entertaining video.
Drew Curtis discusses how he defended his business from a patent troll.
When Fark.com was sued by a patent troll “…for the creation and distribution of news releases via email” alongside companies such as Yahoo, MSN, Reddit, AOL, and TechCrunch, the eight-person company stood its ground.
“I had hoped to team up with some of these larger companies and defend against this lawsuit but one by one they settled out of the case even though not one of these companies infringed on the patent,” says Drew Curtis, founder of Fark.
The reason? The average troll defense costs $2 million and takes 18 months if you win. He proves that little guys don’t have to let themselves get bullied with ! frivolou s lawsuits.
Julia Burstein gives 4 lessons in creativity.
In this inspiring talk, radio host and book author Julie Burstein gives voice to several interviews with remarkably talented people who found that creativity grows when you pay attention to the world around you, learn from challenges, push against the limits of what you can do as well as the hardest thing of all—embrace loss.”
“We have to stand in that space between what we see in the world and what we hope for, looking squarely at rejection, at heartbreak, at war, at death,” she says.
“It’s all very nice being a digital leader, but do you make more money?” According to a recent study from Capgemini Consulting and MIT’s Center For Digital Business, the answer is yes, to the tune of a 26 percent increase in profitability.
According to Didier Bonnet, Capgemini’s Global Practice manager, what distinguishes these companies is an intense focus on transforming in one area that they’re best at, getting it right, and then applying those lessons and data throughout the rest of the business.
These companies see digital technology as the thing that sets them apart, not just another tool. It’s not an experiment, but an intensely focused program based on getting business results.
“They were very focused to start with in their investment,” Bonnet says, “so rather than just going all over the place and investing in, you know, people, collaboration, customer experience, and operations, they had a pretty clear starting point.”
But that starting point can be very different depending on the company, as Bonnet highlighted with these two digital outperformers from the report:
Burberry: Starting with the customer
“For example, Burberry, the fashion retailer, really started with customer experience, they first tried to get their shop sorted out very well, they put screens in that connected all of the shops to the head office. From there, they moved on to slightly more sophisticated social media applications where they actually launch their collection on soc! ial medi a first before they’re at the Milan or Paris shows. From there they moved on to mobility, and now they’re right in the middle of using all of the data for analytic purposes that they’ve managed to gather from connecting their organization. But it started from the customer experience.”
Burberry took the customer experience, invested heavily, then used that data and experience across every channel. Bonnet says “it’s the difference between sticking a technology in an existing process, substitution if you will, versus really transforming the process with the power of what the technology can do.”
Caesars: Using data to make everything personal
“Caesars has really started on analytics, so they tried to really work on how to personalize the experience for the customer. Once the analytics were sorted out, they moved into mobility with location based marketing, eventually reaching a point where you can get recognized when you walk into a store and get preference based coupons and advice on what you can do in the resorts and the casinos. Now they’re moving more and more into the operations side.”
Caesars’ business encompasses shopping, restaurants, casinos, and more. Starting with data from their customers allowed them to take every other tool digital technology has to offer and use it to boost performance across all parts of the company.
Though the paths were very different, the lessons are the same.
Find the report here
p://www. businessinsider.com/how-burberry-and-caesars-went-digital-2012-11#comments”>Join the conversation about this story »
Dr. Augustine Fou is Digital Consigliere to marketing executives, advising them on digital strategy and Unified Marketing(tm). Dr Fou has over 17 years of in-the-trenches, hands-on experience, which enables him to provide objective, in-depth assessments of their current marketing programs and recommendations for improving business impact and ROI using digital insights.
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