Amazon Is ‘Upping The Game’ With Brick And Mortar Locations

Amazon’s newest brick and mortar location opened this week in Chicago. Photo Credit: Greg Kameika

Amazon’s newest brick and mortar location in Chicago opened this week – a Campus Pick-Up point in the heart of the DePaul-Lincoln Park neighborhood.  In a neighborhood with several Amazon Lockers nearby, and a Whole Foods just up the street and Prime Now same day delivery availability, why invest in a fully staffed location, especially one of reported 2,800 sq ft?

Is it just Amazon incrementally ‘upping the game’ in terms of service, or is there potentially more to it?  The new location has several benefits above the established freestanding lockers:  free same-day pick-up on millions of items from the Amazon catalog (not just a small sub-set as in Prime Now), nearly unlimited capacity (you won’t get “locker full, choose another location”), packages held for 15 days, and the ability to package and drop off returns.

While holding packages for 15 days is incremental, expanding the number of same day items available is not.  Amazon can position itself as the go-to one-stop shop for all those semi-impulse and immediate need purchases that would entail a trip to one of the many grocery, general merchandise, big box or specialty retailers nearby.  With the student discount for Prime membership, it is building brand awareness and loyalty with the next generation of shoppers, but services will also resonate with the rest of the large, mainly upscale population in the neighborhood.  And with the size of the footprint one can’t help but wonder if they wouldn’t start stocking a limited number of items on-site once they get a handle on shopping patterns.

Improving e-commerce offerings won’t be the answer for area retailers.  They will need to improve their in-store experiences, provide unique items and offer services that Amazon cannot in order to continue to drive footsteps to the stores.  Otherwise, they will wind up being the second choice for customers.