At first glance, Amazon’s entrance into the U.S. telecom market doesn't make sense. There are already more cellphones than people. And 65 percent of Americans currently have a smartphone in their pocket.
But the Amazon Fire promises to revolutionize not only the mobile market, but the retail industry as well.
Priced at $199, the company's new smartphone will come equipped with cloud storage, multiple cameras and a host of innovative features that could change how Americans shop — both online and offline.
According to senior analyst at Double Diamond Payments Research, Rick Oglesby, “I’m not aware of any other phone so connected to a commerce provider.” He adds, “It’s a very end-to-end Amazon experience that hasn’t been done anywhere else.”
But what makes the Amazon Fire so unique? And what lessons can other retailers glean from this relative latecomer to the smartphone game?
Below are five creative ways that Amazon's experiment could help redefine mobile shopping in the U.S. and around the world:
1. Seamlessly Blended Ecosystem
The primary reason Amazon developed its new smartphone was to enhance users' experiences when browsing and shopping for products in its huge online store. Aware that mobile browsing is on the rise, Amazon wants to make it as easy as possible for prospective customers to find and buy what they want.
Although both Google and Apple provide mobile access to their proprietary online stores, this is the first time a truly retail company has offered such integration.
2. Firefly Barcode Scanner
Firefly is a new Amazon technology that can recognize objects, images and barcodes, allowing shoppers to add these items to their Wish Lists or shopping carts instantly. What this means is that an Amazon Fire customer can walk into your retail shop, scan a few items and walk out — letting you carry inventory costs while Amazon actually captures the sale.
3. Cloud-based Wallet
Virtual wallets are nothing new (Google already offers its own version). But by enabling cloud-based payments on its new phone, Amazon is offering another way for users to shop — even in brick-and-mortar stores. This added convenience will likely make users increasingly reliant on the Amazon Fire as they abandon cash, credit card and other external payment options.
4. Near Field Communication
As if integrated browsing, barcode scanners and virtual wallets weren't enough, Amazon has also decided to add a 4th retail payment option that harnesses contactless near field communication technology. If you thought users couldn't leave their homes without their phones before, just wait until the Amazon Fire goes mainstream.
5. Branded Phone
Given the above features and relatively low price, there is little doubt that the Fire will become mainstream. But taking a page out of the Apple playbook, Amazon has also wisely decided to brand its phone. Every customer becomes a walking advertisement for the new technology, without Amazon having to invest additional resources. This is in sharp contrast to Google’s Android platform, which doesn't have as much brand recognition (unless the screen is actually on).
Should You Follow Amazon's Smartphone Lead?
Most retailers don't have Amazon's deep pockets. And thus, not every one of the above lessons is applicable. But the company's new smartphone highlights how countless opportunities exist — even in a market as saturated as America's telecommunications industry.
According to Nick Holland, senior payment analyst at Javelin Strategy & Research, Amazon’s Fire “really telegraphs what you can do when you devote your resources to fusing online and offline [shopping], using the phone as a conduit between the two.”
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