“Still a long way to go” for Amazon in Australia

AWSAmazon’s second public outing since launching in Australia last December was light on new detail about its plans for the local market but heavy on ambition for what it believes it can achieve here.

Drawing thousands to a concert-sized auditorium in Sydney on Tuesday morning, the e-commerce giant flew in top brass from the states to underline their excitement about enabling Australian businesses to expand their horizons locally and abroad.

SVP of international consumer Russ Grandinetti, one of Amazon’s first 200 employees, was quick to combat the prevailing narrative that the company’s local launch fell short, saying that its first day order volumes were the highest in the company’s history.

“[Country manager Rocco Brauinger] and the team here have done a great job, I’m super proud of them,” he said.

But appearing on a brief panel alongside Grandinetti, Brauniger conceded that there’s still a lot of work to do to make Amazon as compelling to Australians as it is elsewhere in the world.

“There’s still a long way to go,” he said in his second public event since taking his role last August.

“We’re really working hard to bring a lot of innovation here, expanding the selection and making the customer experience for Australian shoppers much better.”

Since launching Amazon has endured a barrage of criticism from prominent retailers and analysts, some of whom have dismissed concerns that the US-based business would have an adverse impact on the Australian market.

AWS2

Photo credit: Ed Lima

“Working hard” on Prime

The Innovation Day, which also included a “metropolis of the future” exhibition, comes at a crucial time for the business Down Under as it looks to build out the various aspects of its complete offer that have made it so successful in the United States.

Fulfilment by Amazon (FBA) and voice assistant Alexa both launched locally earlier this year and while the services are still in relative infancy locally they are important pre-cursors for the Amazon Prime loyalty program, which is expected to launch later this year.

“I don’t have any news to report about Prime other than we’re working hard on it and it will come soon,” Grandinetti said, dashing any hope that Amazon would detail its plans for the program locally.

The launch of Prime is thought to be a potential turning point for the business that rounds out its end-to-end customer strategy, similarly to what it has done in the US where an estimated two-thirds of households are Prime members.

Cross border contribution

The prospect of Prime in Australia also continues to face questions about whether its signature two-day free delivery model would work in a market with such sparse population density, but Grandinetti explained that the program has always been about making a difficult commitment.

“Prime is all about making a hard promise and keeping it as often as possible,” he said. “Telling customers they can subscribe to get free two day shipping is easy, doing it .. is much harder.”

But, as Grandinetti noted, the fully-fledged Amazon experience is already a reality for many Australian businesses selling on the company’s platforms internationally.

A growing number of local retailers are turning to the e-commerce giant to decrease the cost of international expansion, with the likes of Showpo recently revealing that they are in talks with the giant to supercharge their growth in the US.

“Among the most enduring contributions [we make] will be helping Australian businesses around the world,” Grandinetti contended, underscoring Amazon’s focus on cross-border e-commerce.

As was repeatedly stressed though, Amazon is playing a long game and is content with being “misunderstood” in the local market for the time being as it lines up its ducks for a fully-fledged assault.

Brauniger said the Australian Amazon team was busy iterating its offer, trying new things on local shoppers to glean a better view into what works here.

“We’re fine making decisions with 60 per cent of the information, not being experimental means you’re not being innovative,” Brauniger said of his leadership philosophy on Tuesday.

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