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Amazon Shmamazon

Amazon Shmamazon

By Ryan Kuchenmeister

Why the youngest guy in the room isn’t worried about Amazon.

 

Well, this is awkward. The old folks are worried; the young guy isn’t? This doesn’t make sense at all. In fact, it’s probably the opposite of what it should be. Let me explain why Amazon might not be as big of a threat in our industry as we think. A bold statement, I know, but hear me out.

I have attended many electrical-related industry conferences (including many NAED) and there are two discussions that take place at nearly every one of them. One topic is ‘Generations in the workforce’ and the other sounds something like ‘the digital age’ which is where Amazon’s name pops up. Let’s dissect the two for a minute.

OK then, “Generations as they pertain to our digital sales.” No, no, no. Sounds like I’m at another conference. How about “Why business professionals order Starbucks from an app, but won’t buy a men’s 3-piece suit from a webstore.” Now we’re talking. The topic we’re really talking about is ‘risk.’ We could talk about which age group is more/less likely to behave this way, but if you haven’t ordered your coffee from the app, you haven’t lived. No line, easy payment, custom-made for you, walk up and grab it, you’re done. An amazing achievement in the modern digital age. The worst thing that could ever happen to you is either it’s cold (which, if you’ve ever been handed a Starbucks coffee without a cardboard insulator, your hand melts off), or that they made your $5 coffee wrong. Maybe you’d drink it anyway, maybe you’d tell them to remake it, Either way, it’s 5 bucks. Low risk.

OK, now try measuring yourself and ordering a men’s suit from a webstore. If you’ve never walked into a suit tailor, believe you’re missing out. Indulge once in your life. Yeah, yeah, the salespeople are high-pressure and you’ll probably overpay, but never buy off the rack guys, seriously. You’ll be measured with accuracy. You’ll be pampered. Water or tea while you wait? Another associate will be busy collecting all of the shirt/tie combinations that are over-priced. “Matching shoes? Right over here sir.” How about those off-color polka-dot socks? At first glance, they’re way off, but for some reason, they work really well with your new ensemble. And why wouldn’t those socks work? These people are trained professionals. And there you have it, a well-put-together suit for your next NAED conference. You’re looking great. They’ve taken wonderful care of you. Yes, it just cost you an arm and a leg, but everything matches wonderfully and everything fits perfectly. You’re one handsome devil. Low risk.

Let’s tie this into a real-world digital example that happened to K/E recently. After launching a highly sophisticated webstore earlier in the year, we’ve trained various customers in how to use the new tools at their fingertips. We noticed that in the evenings on weeknights (after hours), a select few folks would compile a shopping cart with a handful of parts, but then not check out. They didn’t save the cart, they didn’t submit the order, they just disappeared. Plot twist! At 7:00 am the following morning, those same people would call the K/E store (yes, like with a phone) and place the EXACT same order. What?! You had the order on your screen 10 hours ago. We saw it, you had it. Why didn’t you just click ‘submit’? The answer, ‘Risk.’ Regardless of the generation, we all weigh risk.

Why do I give you that example? If this was a Starbucks coffee, it would be a no-brainer. If this was a 3-piece suit, it would have never happened. Somewhere between those two extremes is electrical material. We’ve been taught in this generation to be skeptical. Don’t trust what you see on your screen, “the picture might not represent the item.” Misleading tinder profile pictures, give me your bank account info so I can transfer your inheritance from an Egyptian prince, click bait on social media, even fake news.

Let’s face it, our customers are testing the waters in this digital age, but they will forever be skeptics of what they see and what they are told. Amazon may be skimming the low-hanging fruit of our industry. Depending on who you ask, that might represent 2-5% of industry sales. Yes, that hurts. They will never, however, treat our customers like my tailor treats me. Impossible. Ask our customers to bear the risk of configuring a switchboard on their own? Compile a fixture schedule themselves? No way. They don’t trust what they see on their screen and maybe not even themselves. This is still a relationship-based industry, and we are the low-risk option when the job has to get done.

Remember 20+ years ago when big box stores were going to take over our industry? Just like we were scared then, this isn’t the end of the world. Leverage your selling tools, maintain your relationships. Use the digital age to your advantage and listen to your customers. I’m youngest guy in the room and I’m not all that worried. Amazon Shmamazon. Is this backwards? I suppose only time will tell.

Always a skeptic, Ryan Kuchenmeister

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Discussion (1 comments)

    Libby Sperry May 31, 2019 / 2:42 pm

    Interesting article! Recently my team discussed a TV ad to purchase a car online (delivered to your door) or with a vending-garage-token. The under 30’s were confident their research, buying experience, and post-sale needs will meet expectations. Being much older with different influencers, as the value or age of the vehicle went up – my tolerance of risk declined exponentially. As you depict, distribution has to find the “sweet spot” of blended sales and services.

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