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Amazon Pushes Competing Retailers To Integrate Services With Its Mobile App, But Why?

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Amazon has been known for aggressively challenging its rivals. But it seems that it could also work with its competitors especially if it is also serving its own ends.

Amazon App Sales Platform

This new development came on the heels of a recent report that Amazon is about to invite its rival e-commerce retailers to peddle their wares inside its app via the so-called place cards.

This is purportedly a service that retailers can use to send email newsletters and other peripherals. Once clicked, they will direct consumers to an app page where their products can be purchased.

One of the advantages of this offering, aside from access to the millions of Amazon app users, is the speed by which the link targets can load. This is reinforced by the fact that the checkout process for mobile web pages is also slower and contains more clutter, a factor that could adversely affect the interest of impatient customers.

Amazon is even said to be taking things further with the introduction of the Amazon Commerce Services, a future offering that would provide dedicated sales platform for retailers but still within the Amazon app. The Information, which first reported the news, has not provided specific details about this service.

Why Push Customers Away?

So why encourage its customers to shop outside Amazon? The answer is simple: Since Amazon now offers an array of products and services, one of its main strategies is to bundle a bunch of these in the area of sales and marketing. For instance, the company is rumored to be diving into Europe as an internet broadband provider just to sell Amazon Prime.

This is the reason why it has no qualms in inviting competing online retailers into the Amazon app.

Even if customers are shopping from rival retailers, they will still be using other Amazon services since the transaction technically transpires within the Amazon app.

The Amazon Payments is a case in point. The company stands to profit from the sales process because the company claims a percentage for each transaction using this online payment mechanism.

Rival Retailer Responds

At this point, it appears that there will be few takers. This is, at least, based on an Engadget report, which documented the ambivalence on the part of third-party retailers such as Macy's. One of its executives revealed that his company is wary about the new service on account of one crucial variable: data.

The current issue that needs resolution is whether Amazon will also keep the customer data for the transactions completed inside the app. Macy's position is a firm negative if one of Amazon's requirements is ownership or the sharing of customer data.

Of course, nothing is set in stone. Macy's and other retailers could yield ground especially given the potential returns for vending inside the Amazon ecosystem. In addition, one should also note that the new Amazon service is still being tweaked and the ultimate outcome may just be a win-win solution for everyone.

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