Living with Amazon, part II

Last post noted that independent booksellers are holding their own against Amazon, and even increasing in numbers. They couldn’t do this if they were just more expensive versions of Amazon — sell a small selection of the same books, just at a higher price.

Here’s the problem in a nutshell: What Amazon’s doing is working great. So you have to find something that Amazon isn’t already doing, which is sell a huge range of stuff, deliver it quickly, take it back if you don’t like it, and recommend other stuff based on your buying and browsing history. And — let me emphasize that — and for which customers will pay enough money to give you a viable business venture.

How do you discover what type of differentiation will do the trick? You might recall that the post I quoted had claimed that “There is very little difference between big, impersonal chain stores selling books and a big, impersonal website selling books,” and I had called him out on it.  The difference lies in what you expect versus what you get. You expect web sites to be impersonal. After all, they are just pieces of software, whereas when you drive to a bookstore, even a big chain, you expect some degree of human interaction.

This should strike a chord. We’re talking about expectations versus the unexpected, or translated into a business setting, expectations versus delight. In any case, cheng / chi. I’ve had several posts on this, and you may recall it as the subject of Chapter VI of Certain to Win.  In other words, it isn’t just the technical side of Amazon that’s making it work, or even the price side — you expect those things by now.

Amazon CEO Jeff Bezos is well aware of this. As he explained in a recent interview:

{It’s} the intersection of customer delight and deep integration throughout the entire stack. One of the hardest and coolest things that you might do occurs right here. When I talk about the entire stack I’m thinking about hardware at the bottom, the OS, the key apps, cloud, and even services on top of that.”

The upshot of all this is, of course, delighted customers, but wait, there’s more. Hiroshi Mikitani, CEO of Japanese e-retailer Rakuten, notes that:

Shoppers do not simply want to come to a site, do business and leave. They want to know the people they buy from. They want to have a relationship with the company that serves them.

He suggests posting a company philosophy on your website. But philosophies, like mission statements, can be written by PR or marketing, posted on the “About Us” page, and with any luck, mercifully forgotten. Think a little more deeply about why relationships work. Not all of them will do the job Mikitani wants: We all have “relationships” with organizations that we’ll never go back to again, ever.

No, the relationship that keeps people coming back not only meets their expectations, but stirs those pangs of delight. And you can do that with cheng/chi. So if you own a local athletic show store, for example, competing with Zappos (owned by guess who), you have to do more than just be friendly and knowledgeable and stock the same running shoes everyone else does. After a while, people will expect that. You have to do the hard work to find something that goes beyond that, such as … I don’t know – I’m not in the running shoe business. But that’s where you have to put your Schwerpunkt.

And if you do, you can even become a cause; How many Apple fanboys  (and fangirls) have ever actually met someone who worked for Apple, other than perhaps sales and service people at their local store?

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