Competing with Amazon- without its budget

Competing with Amazon- without its budget

Amir KonigsbergCo-Founder & CEO, Twiggle

Amazon's ambition was on display recently with the disclosure that it spent close to $23bn (£16.5bn) on research and development in 2017. The company snagged 44% of all US e-commerce sales in 2017, and that number is expected to grow by 20% this year. This is more than technology giants such as Alphabet, Intel, Microsoft and Apple.

Make no mistake, Amazon is a technology company that just happens to do retail.

With the ultimate goal of owning the entire e-commerce supply chain, Amazon’s strategy can focus on long-term domination rather than short-term profit. This dominance has left many e-tailers convinced that there is no way out. But what these online retailers really lack is an effective long-term strategy leveraging the very things Amazon doesn’t have so as to improve their existing advantages to beat the giant at its own game.

Master your niche

The old saying goes that a Jack of all trades is a master of none. Retailers should position themselves as true experts in their product niche, so consumers will know that shopping at their online shop guarantees the best product offering.

B&H, the famous electronics retailer, has just the one location in New York but powers a huge e-commerce operation. It has built a customer community around its expert offering of electronics, with an emphasis on photography. The staff is knowledgeable about the products they offer- B&H’s Director of Corporate Communications is even a former photographer.

B&H runs a photography podcast...by sharing expertise for free, they've built a shopping platform photographers trust.

The company runs a photography podcast that covers product reviews, tips on cleaning camera lenses, history lessons on photography and hosts Q&A sessions with famous photographers. By sharing expertise for free, they’ve built a shopping platform photographers trust.

The personal touch

It’s hard to build a tailored, individualised shopping experience when selling every kind of product in the planet. A recent report by Segment on the ‘State of Personalization’ in 2017 found that 75% of online shoppers expect a personalised experience, yet only 23% of online shops actually deliver such an experience.

Consumer behaviour has also shifted from ‘where can I buy this product?’ to ‘help me figure out what I should buy’. Herein lies great opportunity.

Consumer behaviour has also shifted from ‘where can I buy this product?’ to ‘help me figure out what I should buy’


Glossier, an online cosmetics retailer, gleans data from its popular beauty blog ’Into the Gloss’ to drive tailored shopping journeys. Consumers are offered discounts and product suggestions based on the articles they read, liked on social media or shared with friends.

It also recently invited its top 100 customers to a group Slack channel to gather product feedback. The company’s revenue increased by 600% in 2017.

Partner with innovators

Retailers understand by now that technological innovation is vital to their survival. Fortunately, innovative solutions for omnichannel, ecommerce search and predictive intelligence (to name just a few) are readily available and quite affordable.

Retailers can now match Amazon’s logistical excellence with Bringg, an intelligence platform that helps streamline shipping in terms of operational efficiency and customer experience.

Neiman Marcus and J. Crew use Celect, an inventory optimisation technology company, to reduce inventory excess and stockouts. To meet the urgent needs and demands of customers tomorrow, retailers should partner with technology companies today.

In sum, online stores still have quite a few tricks they can leverage to bite back as Amazon tries to eat the world.

As exemplified above, retailers don’t need $23bn in R&D to harness the very things that make their business unique or provide a customer experience that truly delights – they just need the right mindset and technology partners. Investing in these can help them not only survive, but thrive.

This article originally appeared in Retail Week.