Special Delivery

By Susan Bloom

Experts contend that Amazon’s recently-announced “drone delivery” capability presents both a threat and an opportunity for distributors.

Last month, Amazon unveiled the latest in its series of revolutionary approaches to e-commerce – the ability to fly packages to your doorstep in as little as half an hour using drone delivery.  Still in the testing and FAA approval phase, Amazon announced that the new service, known as Amazon “Prime Air,” could be available to customers in the next 4-5 years.

“This delivery system from Amazon is designed to safely get packages to customers in 30 minutes or less using unmanned aerial vehicles, or drones,” confirmed industry expert Justin King, Senior Partner at Washington, D.C.-based B2X Partners (www.B2XPartners.com) and founder of eCommerceandB2B.com.  While still several years away from being a viable delivery mechanism for the online retail giant, King advises distributors to “take this development seriously,” as does Dirk Beveridge, founder of UnleashWD (www.unleashWD.com), a two-day, Chicago-based innovation summit for future-thinking distributors. 

Following, tED magazine tapped both King and Beveridge for their thoughts on what Amazon’s new drone delivery capability could mean for e-commerce in general as well as for the future of electrical distribution.

tED magazine: What immediate implications will this capability have for the e-commerce world as well as for the B2B sector in the future?

King:  Companies like Amazon aren’t doing drone deliveries for fun — they recognize that the “last mile” for their customers is important. Two-hour delivery has been successful and they want to speed that up and make it even more efficient. The Amazon.com site is great and what most of us associate with the Amazon experience is that “I clicked and then it arrived,” which demonstrates that e-commerce isn’t just about the ‘online’ aspect, but about transforming the ENTIRE customer experience, from finding the right products to unbelievably fast delivery.  As Amazon Business continues to play an increasingly larger role within Amazon, I think that we can expect to see similar experiences rolled out to Amazon Business customers over time.

Beveridge:  Amazon Prime Air may indeed be a game changer, but could also go the way of AmazonSupply or the Amazon Fire phone — two busts.  But what Amazon does better than many other organizations is that they’re very good learners.  They stop, pause, and think, take the lessons from their successes and failures, and link and use these lessons to re-think strategies, problems, opportunities, and possibilities.

tED:  With e-commerce players all fighting for that “last mile” to the customer, how will this capability help Amazon leap ahead and possibly pass other competitors on that front?

King:  I think that this development might actually enable the electrical distributor. Drones are inexpensive resources compared to people and local transportation. For smaller items, innovative distributors will latch onto this new technology and gain a huge local competitive advantage, and Amazon can help pave the legal way for regional and other national players. For those distributors who don’t take Amazon seriously, however, this could represent another way in which Amazon is leapfrogging companies and putting all distributors at risk.

tED:  How should electrical distributors approach this innovative new development?

Beveridge:  Today it’s important to develop a discipline that I call “Peering into the Future” – e.g., identifying trends, making sense of them, and then using this insight to build your strategy going forward.  Technology is changing the way business is done and the changes that are going to impact electrical distribution are already out there. The willingness to adapt and evolve, no matter who’s making headlines – be it Amazon, Grainger, or entities we don’t even know — begins with your mindset.  With the right mindset, distributors can succeed widely no matter what Amazon does next.

tED:  What message would you like electrical distributors to take away from Amazon’s new drone delivery announcement?

King:  First of all, take it seriously. Borders didn’t believe Amazon would work, nor did Blockbuster believe that RedBox and Netflix would work. No one believed two-hour delivery either. As it relates to drone delivery, I want distributors to believe it, but at the same time embrace it. They should take a look at their entire customer experience and engage in customer journey mapping to identify the pain points that their customers have.

Beveridge:  I agree and actually think that the focus shouldn’t be on Amazon per se; it’s bigger than that.  In the past, distributors just had to compete against the guy across town, another business which looked at the world in a very similar way.  But now we need to understand our new competitors and what the world’s boldest, smartest, and most relentless innovators can create using technology.  In that sense, it doesn’t really matter if Amazon Prime Air succeeds or not – at the end of the day, distributors had better get to work redefining their relevance going forward in order to remain competitive.

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Bloom is a 25-year veteran of the lighting and electrical products industry. Reach her at susan.bloom.chester@gmail.com.